Manual cost estimation process for heat exchanger having the less accuracy when compared with supplier’s quotation and having several challenges like costing is based on the assumption, inaccurate process time estimation, data collection from the plant are not up to date. The objective of this work was to develop an accurate, reliable and time-saving cost model using the aPriori cost estimation tool for heat exchanger. aPriori cost estimation tool consist of two parts are Virtual Production Environment (VPE) and Cost Model (CM). VPE is the digital copy of the specific plant. To develop the VPE required data was material data, machine data, process data and plant data and created the template to collect the data from the plant. CM was written with Cost Scripting Language (CSL) are used to build logic and formulae and defined the cost taxonomy, machine selection rule and material selection rule was developed. VPE and CM was developed for manual brazing, robotic brazing, tube expansion, tube insertion and turret press process. Validated the manufacturing times consist of cycle time 103 seconds and labor time 103 seconds and cost variables consist of labor cost $ 0.87, direct overhead cost $ 0.03, addition direct cost $0.20, total variable cost $ 1.10 and fully burdened cost $ 1.46 for manual brazing process and similarly validated the cost parameters for the robotic brazing, tube insertion, tube expansion and turret press process successfully. aPriori cost estimation model reduced the overall production time, improve the productivity and quality of the product. aPriori cost model estimated that manufacturing cost of fin and tube heat exchanger around annual saving 19% of manual process cost estimation of the fin and tube heat exchanger.