Series Systems Parallel Systems Component Reliability Component Reliability Component 1 0.99 Component 1 0.9 Component 2 0.999 Component 2 0.9 Component 3 0.96 Component 3 0.9 Component 4 0.98 Component 4 Component 5 Component 5 Component 6 Component 6 Component 7 Component 7 Component 8 Component 8 Component 9 Component 9 Component 10 Component 10 System Reliablity 0.930460608 System Reliablity 0.9990000000

Using the data presented, identify the supplier configuration that results in the lowest cost and highest cost airbag systems. Using your calculations for question 1, what would be the reliability of the low- and high-cost systems? Use the attached Systems Reliability Excel template. What is the highest reliability that can be achieved? What would this cost? Astro Automotive does not feel that the highest reliability that can be achieved from the existing components is acceptable, primarily because of the relatively low reliabilities of the airbag module and clock spring. The R&D department estimates that developing these new components with higher reliabilities will cost $1.2 million and that the unit manufacturing cost for the airbag module will be $650, and the cost for the clock spring will be $130. If the reliabilities for these components can be increased to 0.9999, how much can the system reliability be improved? Compare the cost and reliability of the four design options (low cost, high cost, high reliability, and Astro-developed airbag module and clock spring). If Astro Automotive estimates selling 10 million vehicles, how many airbag systems will fail for each option? What design should the company choose? What are the risks that Astro Automotive might face? Explain your reasoning.