Small production runs spread development costs across fewer ships. Six Type 45s account for a £6 billion programme in this calculation. Another six are estimated at roughly £1.8 billion to £2.4 billion, giving a possible £8.4 billion programme and £700 million average for twelve ships. The estimate for fourteen is about £9 billion. These are counterfactual estimates. Once development is paid for, later expenditure concentrates on hulls and equipment. Inflation still matters, but a larger order can reduce the average programme cost assigned to each ship.
Notable Point · 1:23:50-1:25:35
How a larger Type 45 order changes average cost
The Type 45 example separates development expenditure from the cost of additional ships.