Economic Impact Assessment of the International Standard for the Exchange of Product Model Data (STEP) in Transportation Equipment Industries
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Planning Report 02-5 Economic Impact Assessment of the International Standard for the Exchange of Product Model Data (STEP) in Transportation Equipment Industries Prepared by: RTI International for National Institute of Standards & Technology Program Office Strategic Planning and Economic Analysis Group December 2002 U.S Department of Commerce Technology Administration December 2002 Economic Impact Assessment of the International Standard for the Exchange of Product Model Data (STEP) in Transportation Equipment Industries Final Report Prepared for National Institute of Standards and Technology 100 Bureau Drive Gaithersburg, MD 20899 Prepared by Michael P. Gallaher, Ph.D. Alan C. O’Connor, B.A. RTI Health, Social, and Economics Research Research Triangle Park, NC 27709 and Thomas Phelps, Ph.D. Altarum Ann Arbor, MI RTI Project Number 07007.016 Contents Executive Summary ES-1 1. Introduction 1-1 1.1 The Role of Standards in the Exchange of Product Data...... 1-2 1.2 The STEP Development Process......................................... 1-5 1.3 NIST’s Role in the STEP Development and Adoption Process ............................................................................. 1-7 1.3.1 NIST’s Contributions as Infratechnologies............... 1-8 1.4 Industry Scope ................................................................ 1-10 1.4.1 Industries Included in this Study........................... 1-10 1.4.2 Other Industries Using STEP................................. 1-12 1.5 Report Organization........................................................ 1-12 2. Technical History of STEP 2-1 2.1 Introduction to Product Data Exchange and Interoperability.................................................................. 2-1 2.1.1 Overview of Product Data Exchange...................... 2-2 2.1.2 CAx Interoperability Problems................................ 2-3 2.1.3 Potential Methods for Improving CAx Interoperability ...................................................... 2-5 2.2 Technical History of STEP and NIST’s Role ........................ 2-9 2.2.1 NIST’s Role in the STEP Development Process...... 2-10 3. Current STEP Development and Implementation 3-1 3.1 Current Trends in the Development and Implementation of STEP..................................................... 3-1 3.1.1 Most Widely Implemented STEP APs...................... 3-1 3.1.2 Approved STEP APs ............................................... 3-4 iii 3.1.3 STEP APs Under Development............................... 3-4 3.1.4 Infrastructure Tools to Support STEP Development and Adoption................................... 3-5 3.2 Barriers to Development and Adoption of STEP.................. 3-6 3.2.1 Evolving Structure of CAx Markets.......................... 3-7 3.2.2 Shift in STEP’s Support Structure............................. 3-8 3.2.3 Implementation by Software Developers .............. 3-10 3.2.4 Adoption and Use of STEP by End Users .............. 3-13 4. STEP End Users 4-1 4.1 The Automotive Industry ................................................... 4-1 4.1.1 The Automotive Design and Development Process.................................................................. 4-2 4.1.2 The U.S. Automotive Supply Chain ........................ 4-6 4.2 Aerospace Industry.......................................................... 4-11 4.2.1 Aerospace Design and Development.................... 4-12 4.2.2 The Role of CAx Systems in the Aerospace Industry ............................................................... 4-15 4.2.3 The Aerospace Industry Supply Chain .................. 4-16 4.3 Shipbuilding Industry ...................................................... 4-22 4.3.1 The Shipbuilding Design and Development Process................................................................ 4-24 4.3.2 CAx Systems in the Shipbuilding Design and Development Process .......................................... 4-27 4.3.3 Organization of the Shipbuilding Supply Chain .... 4-28 5. Analysis Methodology 5-1 5.1 Conceptual Approach for Estimating Economic Impacts............................................................................. 5-1 5.1.1 Net Benefits from STEP .......................................... 5-1 5.1.2 NIST’s Contributions.............................................. 5-4 5.2 Technical and Economic Impact Metrics............................ 5-6 5.2.1 Metrics for Measuring the Benefits and Costs of STEP...................................................................... 5-7 5.2.2 Metrics for Estimating NIST’s Impacts................... 5-11 5.3 Calculating Measures of Social Return ............................. 5-14 iv 6. Primary Data Collection 6-1 6.1 End-User Interviews .......................................................... 6-1 6.1.1 Case Study and Survey Topics................................ 6-3 6.1.2 Case Study and Survey Respondents....................... 6-4 6.2 Software Developer Interviews .......................................... 6-4 6.2.1 Software Developer Survey Topics ......................... 6-5 6.2.2 Software Developer Respondents ........................... 6-7 7. Current Use and Future Directions for STEP 7-1 7.1 STEP’s Current Use............................................................ 7-1 7.1.1 Automotive Industry .............................................. 7-1 7.1.2 Aerospace Industry ................................................ 7-3 7.1.3 Shipbuilding Industry............................................. 7-4 7.1.4 Small-Company Issues ........................................... 7-5 7.2 STEP’s Potential Use.......................................................... 7-5 7.2.1 Automotive Industry .............................................. 7-6 7.2.2 Aerospace Industry ................................................ 7-8 7.2.3 Shipbuilding Industry............................................. 7-9 7.2.4 Small-Company Issues ........................................... 7-9 7.3 Future Product Data Exchange Needs .............................. 7-10 7.3.1 Automotive Industry ............................................ 7-10 7.3.2 Aerospace Industry .............................................. 7-11 7.3.3 Shipbuilding Industry........................................... 7-11 8. The Potential and Current Economic Impact of STEP 8-1 8.1 Industry Employment and Wages....................................... 8-1 8.1.1 Industry Employment ............................................. 8-1 8.1.2 Industry Wage Estimates ........................................ 8-4 8.2 End-User CAx Interoperability Benefits .............................. 8-6 8.2.1 End-User Avoidance Benefits ................................. 8-6 8.2.2 End-User Mitigation Costs.................................... 8-15 8.2.3 End-User Delay Costs .......................................... 8-26 8.3 Social Costs of STEP ........................................................ 8-26 8.3.1 Categories of Social Costs .................................... 8-27 8.3.2 Software Developer Expenditures......................... 8-28 v 8.3.3 Transportation Equipment Industry Expenditures........................................................ 8-29 8.3.4 Public Sector Expenditures................................... 8-30 8.4 Measures of Economic Return from STEP ......................... 8-31 8.5 Return to NIST Contributions........................................... 8-35 8.5.1 Estimating NIST’s Impact...................................... 8-37 8.6 Summary of Impacts........................................................ 8-38 References R-1 Appendixes A Telephone Survey..............................................................A-1 B Software Developer Survey................................................ B-1 vi Figures Figure 1-1 Alternative Data Exchange Scenarios.......................................... 1-4 Figure 1-2 Infratechnologies’ Impacts on Economic Activity ........................ 1-9 Figure 2-1 Multiple CAx Systems Used in the Automobile Supply Chain...... 2-3 Figure 4-1 The Automobile Design and Development Process..................... 4-4 Figure 4-2 U.S. Automotive Supply Chain................................................... 4-8 Figure 4-3 Aerospace Design and Manufacturing Schedule ....................... 4-13 Figure 4-4 Ship Types............................................................................... 4-24 Figure 4-5 Ship Design Spiral.................................................................... 4-26 Figure 5-1 Flow of Costs and Benefits ......................................................... 5-4 Figure 5-2 Impact of NIST’s Contribution to STEP........................................ 5-5 Figure 6-1 STEP Estimation Methodology .................................................... 6-2 Figure 8-1 Growth in Major CAx Software Packages with STEP Functionality............................................................................ 8-28 Figure 8-2 Estimated Accrual of Potential Benefits (1994 though 2010)...... 8-34 vii Tables Table 1-1 Comparison of Data Exchange Scenarios.................................... 1-5 Table 3-1 Status of STEP Application Protocols as of November 2002......... 3-2 Table 4-1 Employment in the Automotive Industry, 2001 ........................... 4-6 Table 4-2 Major OEMs Operating in the U.S.............................................. 4-9 Table 4-3 Characteristics of a Sample of Automotive First-Tier Suppliers.................................................................................. 4-11 Table 4-4 Aerospace Product