2T LCV Rear Drive Axle
Should Cost Analysis
Light commercial vehicle OEM · 51.2 kg assembly · 40,000 units/year · India manufacturing
Assembly Cost
$244 / unit
Annual Volume
40,000 units
Finish Weight
51.2 kg
Sub-Assemblies
4 major
Region
India
Assembly Cost Roll-Up
Drive Head / Carrier drives 46% of total cost
Cost share by sub-assembly
Assembly hierarchy
Primary Cost Driver - 46% of Axle
Drive Head / Carrier Assembly - $112.00
| Component | Type | Cost ($) | Share |
|---|---|---|---|
| Carrier Housing | Casting & M/C | $18.42 | 16% |
| Bearing LM603049 (×2) | BOI | $18.17 | 16% |
| Ring Gear | Forged & M/C | $11.44 | 10% |
| Drive Head Assy. | Assembly | $10.83 | 10% |
| Bearing - Pinion Head | BOI | $9.21 | 8% |
| Pinion Shaft Main Drive | Forged & M/C | $7.49 | 7% |
| Bearing - Pinion Tail | BOI | $5.60 | 5% |
| Diff Cage Assy. | Assembly | $4.68 | 4% |
| Cage - Diff Gears | Casting & M/C | $5.41 | 5% |
| Side Gear 24T (×2) | Forged & M/C | $4.52 | 4% |
| Other (caps, HW, seals) | Various | $4.54 | 4% |
| Total Drive Head / Carrier | $112.00 | 100% | |
Dual Cost Leaders - 16% Each
Carrier Housing vs Bearings
Carrier Housing (cast + machined, 9.5 kg) and Bearing LM603049 pair are tied at $18.42 and $18.17 - together they drive 32% of drive head cost.
$18.42
Carrier Housing
$18.17
Bearings (BOI)
BOI Concentration
Bought-out items (bearings, oil seals) represent ~29% of Drive Head cost. Supplier benchmarking and multi-source qualification are the only levers available.
Forged Components
Ring Gear + Side Gears + Pinion Shaft = $23.45 (21%). All forged and CNC machined - gear hobbing and deburring are the dominant process cost drivers.
Sub-Assembly Breakdown
Axle Housing & Half Shafts
20% of Axle Cost
Axle Housing - $48
Weldment · 17.37 kg · 16 line items
12% Each · 24% Combined
Half Shaft RH + LH - $60.62
Mirror configuration · 9.52 kg each · Brake Plate = Customer Scope
Assumptions & Rates
Material, machine & overhead basis
Key Material Grades
18CrNiMo7-6
Gear steels
ASTM A247-10
Castings (ingot)
EN24
Alloy steel rod
En353
Alloy steel sheet
IS2062
Structural sheet
C60E
High carbon rod
Cast Steel
Sand casting
Machine Hour Rates
Overhead Structure
Excludes: packaging, brake/drum assembly, painting, lubricants
Commodity Intelligence
Manufacturing processes across the BOM
Forged & M/C
6 line items
Ring gear, half shaft, pinion, side gears
Casting & M/C
7 line items
Carrier housing, bearing caps, end flanges, cage
Formed / Weldment
8 line items
Housing halves, brackets, wrapping plates
BOI (Bought Out)
12 line items
Taper bearings, oil seals, O-rings, bolts
Emithran Analysis
Key findings from this should cost
Drive Head is the Leverage Point
At 46% of total axle cost, any optimisation in carrier housing casting yield, bearing sourcing strategy or gear hobbing efficiency delivers outsized savings at the assembly level.
BOI Pricing Controls ~18% of Axle
Bearings and seals are bought-out items. Their unit pricing is directly passed through - supplier benchmarking and multi-source qualification are the only levers available.
Forging is the Process Cost Engine
Ring gear, half shaft, pinion, and side gears are all forged + CNC machined. Roll forging at $29/hr and gear hobbing at $4/hr are the dominant process cost contributors.
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