Optimal condition-based renewable warranty policy for products with three-stage failure process

ABSTRACT

A three-stage failure process divides a product’s life into three stages: normal, minor defective and severe defective stages. Under the condition-based renewable warranty policy, inspections are carried out to check which stage the product is in. Condition-based activities, such as shorting inspection intervals, preventive replacement and failure replacement, are carried out properly. From a manufacturer’s perspective, the inspection interval is optimized by minimizing the expected cost rate per unit time over the whole warranty coverage. For comparison, the expected cost rate per unit time for warranty models without inspections and with fixed interval inspections are also derived. Numerical examples show that condition-based renewable warranty policy replacement policy can reduce the manufacturer’s warranty cost significantly.

KEYWORDS:

• Renewable warranty
• condition-based warranty policy
• three-stage failure process

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Funding

This work is supported partly by the NSF of China Grants [11471218] and universities in Hebei province science and technology research project [ZD2018073].

Notes on contributors

Liying Wang

Liying Wang received her PhD in 2011 from School of Management and Economics, Beijing Institute of Technology(China). She is currently a professor in Shijiazhuang Tiedao University(China). Her research interests are reliability engineering, stochastic models, applications of probability and statistics.

Yanmei Yang

Yanmei Yang received her Bachelor degree in 2015 from School of Mathematics and Applied Mathematics, Huihua college of Hebei Normal University(China). She is studying for a master degree in Applied Mathematics at Shijiazhuang Tiedao University(China). Her research interests are reliability Engineering, stochastic models, applications of probability and statistics.

Huihui Zhu

Huihui Zhu received her Bachelor degree in 2017 from School of Mathematics and Applied Mathematics, Shijiazhuang University(China). She is studying for a master degree in Mathematics and Applied Mathematics at Shijiazhuang Tiedao University(China). Her research interests are reliability Engineering, stochastic models, applications of probability and statistics.

Guoxin Liu

Guoxin Liu received his PhD in 1998 from Changsha Railway University(China). He is currently a professor in Shijiazhuang Tiedao University(China). His research interests are applied stochastic processes, stochastic control.