Construction vehicles are workhorses. However, all eventually reach high hours, indicating the end of their original service life.
When your excavators, loaders and other machinery begin to show their age, you have three options — rebuild, remanufacture or replace them. Each differs in scope, work needed, disruption and cost and has limitations. Learn which is the most practical option to minimise your expenses and downtime.
When rebuilding makes sense
Rebuilds focus on repairing or replacing only worn components to restore basic functionality at the lowest possible cost. They can entail dismantling assemblies or entire machines to enable thorough inspection and identify which parts need to go.
Technicians may use a combination of new, used, and reconditioned original components and aftermarket parts to address problem areas. They can meet manufacturer wear limits without causing excessive downtime.
The targeted approach of rebuilds is a sustainable, cost-effective solution when the core of high-hour vehicles remains sound. It allows your crew to keep using familiar equipment, skipping the adjustment period typically associated with operating new machines. Some plant designs may introduce new hazards, and operators ought to familiarise themselves with the recommended control measures to ensure workplace safety.
Cost varies by local shop, but it should be moderate if your ageing machine’s core is intact. While a rebuild helps preserve your heavy equipment’s value, you may not recoup dollar for dollar at resale. Independent shops are not required to offer anything more than basic consumer guarantees, such as repair and replacement entitlements. Still, any additional promise made to you becomes a legal right once you pay for the service, provided you abide by the agreed-upon conditions.
Unfortunately, only some manufacturers design their construction vehicles to have multiple lives, so not all machines are inherently rebuildable. Furthermore, obsolescence can render overhauls out of the question for older rebuildable plant.
When to remanufacture rather than rebuild
Remanufacturing is a standardised industrial process. It’s a complete teardown and meticulous inspection of equipment to ensure every component meets the standards.
Everything gets disassembled to the bare metal for chemical or ultrasonic cleaning and full restoration. The job involves nondestructive testing, extensive precision machining, and mandatory replacement of all wear items to adhere to original or upgraded manufacturer specs.
Major construction vehicle brands have formal programs, which make unaffiliated service centres less qualified to perform all essential tasks. Original equipment manufacturers (OEMs) entrust remanufacturing processes to their networks of authorised dealers. They give credentialed crews access to engineering blueprints and proprietary replacement components.
Such restrictions can drive up labour costs and increase downtime. On the bright side, remanufactured assets come with factory warranty protection and can fetch higher offers on the market than rebuilt vehicles. This option costs more than rebuilds but should still be less expensive than buying a new equivalent asset.
However, remanufacturing may be impossible due to obsolescence. If your high-hour excavator or loader is too old, its maker may no longer supply original critical replacement parts. Nonexistent remanufacturing programs for off-brand machines mean there’s probably no way to restore them to factory-new tolerances.
When replacement is the soundest choice
Replacing ageing construction assets makes sense if you want to modernise your fleet or find their total cost of ownership (TCO) still too high after rebuilding or remanufacturing them. The factors heavily influencing heavy equipment TCO include the purchase price, operating expenses, such as fuel, maintenance, repairs and insurance, and resale value. To calculate it, add up a machine’s purchase price and operating expenses, then deduct its projected resale value from the sum.
Rebuilding or remanufacturing costs can affect ownership calculations, but their accounting treatment depends on whether the work is classed as a repair, replacement or capital improvement. For a practical fleet decision, compare the quoted work against the machine’s remaining useful life, expected downtime, warranty cover and likely resale value rather than assuming it automatically resets depreciation.
Rebuilt and remanufactured assets have higher resale value mainly because they’re perceived to be in better condition than similar older plant that didn’t undergo rebuilding or remanufacturing. However, improved vehicles can still depreciate quickly because their hour meters don’t reset to zero. Models with weak market demand are also less likely to hold their value.
Replacement usually costs more up front, though used vehicles have lower price tags. If you only use your asset occasionally, replacing it with a rental with advanced features, such as emissions-tracking tools and onboard telematics devices, is even more practical. That’s because you can pay for it on a daily or weekly basis.
When buying, you can trade in your high-hour asset to save more money and negotiate with the seller to keep it in your fleet while you wait for your order to arrive. Brand-new vehicles come with manufacturer warranties. Coverage for secondhand equipment depends on its age and maintenance history.
Managing construction fleets while minimising costs
Deciding what to do with high-hour construction assets can be challenging, especially as machine prices rise. Nevertheless, you have plenty of options to explore to keep your fleet productive and lower your long-term ownership costs.