Extended service coverage cost predictions

The system used to estimate expected cost of service coverages such as those included in the extended transmission coverage program (ETC) is described. The system simulates the life of each vehicle transmission model for a specific vocation using two components in series. The life of each is described by a two-parameter Weibull distribution. One of the components is given a wearout slope (greater than 1.0); the other is given a decreasing removal rate (a slope less than 1.0). Specific slopes and characteristic lives are determined by fitting data from a transmission analysis system (TRANS). Cost per removal, nonremoval cost, and mileage accumulation rate distributions are determined from warranty data. The required data files are online and are periodically updated. An interactive, menu-driven program has been written to aid the analyst in combining the appropriate distributions. The distribution of months between the date a unit is built and the date the end user puts it into service and the distribution of months between a repair and claim payment are also included in the system to permit a simulation of warranty and extended-coverage payout schedules. A reasonable degree of agreement has been demonstrated between these simulations and historic payout profiles