Repair / Replace / Rebuild

Planning for Effective

Equipment Decision Making

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 Daily gathering of fleet information

Aggregating the data into usable information

What will we cover?

Application of the data into a solid
repair/replace/rebuild decision

Prevention is always better than cure

Be Proactive, Have a Plan!
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Why is this more “art” than “science”?

No absolutes

The elusive economic “Sweet Spot”

Decisions based on a multitude of factors

Major factors beyond your control:

•Hot shutdowns
•Overheat of lack of lube events
•Filters in bypass mode

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 Understand Your Company’s Business
Situation and Equipment Culture
• Ownership preference for a new or an aged fleet?
• Availability of capital?
• Payments and depreciation vs. high op costs?
• Outlook for work?
• Latest technology needed for a competitive edge?
• Equipment produce or support the work?
• Effect of downtime?
• Consider cost of “spare” equipment?
• Important to maintain a shop and mechanics?
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 Ask yourself these 8 tough questions:
• Do you know your CPH at the category level? The s/n level?
• Do you know your costs at the major component level?
• Do you know your annual utilization per unit?
• Do you have a strong, ongoing PM program including oil
sampling?
• Do you have a strong, multi-level inspection program?
• What tools do you use to track and manage your
equipment?
• Are your operators well trained?
• Are you partnering with your dealer/manufacturers to take
advantage of all programs and tools available to reduce your
cost?
How does your organization rate?
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 The Spectrum
What is the difference?

Action When Why Criteria

No On-Shift
Maintain Any Time Prevent Failure
Failures

Working Again
Repair After Failure Return to Work
No Additional Life

Additional Life
Rebuild Any Time Reinstate Quality
Improved Quality

Maintain or Change
Replace Any Time Cost? Quality?
Capacity

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 What are some tools I can use?
Feedback from the field/operator
Fuel burn
Telematics data
Oil sampling data
Dealer resources

ECM downloads Inspections related to PM services

Strong CMMS program and history

CEMP Sweet Spot Small Tool

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 Some Dealer Resources
• In depth inspections including performance testing
• Component life analysis tools like Cat SOMA (Site
Operation & Maintenance Advisor)
• ECM download reports such as Volvo Matris
• Life cycle cost analysis, component risk & change out
planning using program such as Cat Builder &
Calculator
• Maintenance and repair agreements such as
Komatsu’s RAMP programs
• Integrated programs such as John Deere’s Fleet Care
and now merging into WorkSight
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 Maintenance Effectiveness
Maintenance Program
•PM
Reliability •Inspections & Monitoring
•Planning & Scheduling
•Repair

Age
Design
Application
& Operation
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 Maintenance Effectiveness
Maintenance Program
•PM
•Inspections & Monitoring
•Planning & Scheduling
•Repair
Reliability

Age Older
More Complex
Design
Application More Severe
& Operation
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 Repair Before Failure
Urban Legend: “If it ain’t broke, don’t fix it!”

Inspection-Planning-Scheduling-Execution
Goal is to Reduce/Eliminate Failures

• Failures are normally 1.5 – 2 x more costly than a scheduled

repair – rebuild
• Side effects – lost productivity, equipment rental expense,
crew/customer issues
• Cost control lost, the urgency to get machine back up
escalates repair labor and cost

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Machine data Condition Monitoring
Wired
or Process/Tools
Wireless
Use these 5 CM elements to
make maintenance and repair
recommendations

5 CM Elements
1. Machine Data
2. Fluid Analysis
Reliability Maintenance and
3. Inspections Engineer/Fleet Repair
4. Repair History Analyst Recommendations
5. Site Conditions PM

HR Performance CM

P&S
Production & Backlog
CI
Availability Reports Repair

Component Parts

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 Some of my “Rules of Thumb”
1st Life or Replacement:
5-6,000 hours:
Skid steers, compact track loaders, vibratory rollers
7-8,000 hours:
Mini-excavators, loader-backhoes, asphalt pavers
10-12,000 hours:
Med. excavators, wheel loaders, dozers, scrapers,
compactors, motor graders
12-16,000 hours:
Large excavators, wheel loaders, dozers, scrapers,
compactors, motor graders, track cranes

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 Cat 980 Wheel Loader Churn Chart
Anticipated maximum life for class 15,000 Green Orange Red
Anticipated annual utilization for class 1,000 0.6 to 0.8 Target 0.8 - 1.2 Target More than 1.2 Target
Expected hours in the given number of years ahead
Unit Make Model Hours now 1 2 3 4 5 6 7 8

170801 Caterpillar 980G 17,613 18,613 19,613 20,613 21,613 22,613 23,613 24,613 25,613
170802 Caterpillar 980G 17,436 18,436 19,436 20,436 21,436 22,436 23,436 24,436 25,436
170803 Caterpillar 980G 16,974 17,974 18,974 19,974 20,974 21,974 22,974 23,974 24,974
170804 Caterpillar 980H 16,312 17,312 18,312 19,312 20,312 21,312 22,312 23,312 24,312
170805 Caterpillar 980H 15,808 16,808 17,808 18,808 19,808 20,808 21,808 22,808 23,808
170806 Caterpillar 980H 14,675 15,675 16,675 17,675 18,675 19,675 20,675 21,675 22,675
170807 Caterpillar 980H 12,999 13,999 14,999 15,999 16,999 17,999 18,999 19,999 20,999
170808 Caterpillar 980H 11,265 12,265 13,265 14,265 15,265 16,265 17,265 18,265 19,265
170812 Caterpillar 980H 8,866 9,866 10,866 11,866 12,866 13,866 14,866 15,866 16,866
170813 Caterpillar 980H 8,334 9,334 10,334 11,334 12,334 13,334 14,334 15,334 16,334
170814 Caterpillar 980H 7,784 8,784 9,784 10,784 11,784 12,784 13,784 14,784 15,784
170815 Caterpillar 980H 7,535 8,535 9,535 10,535 11,535 12,535 13,535 14,535 15,535
170816 Caterpillar 980K 6,576 7,576 8,576 9,576 10,576 11,576 12,576 13,576 14,576
170817 Caterpillar 980K 5,881 6,881 7,881 8,881 9,881 10,881 11,881 12,881 13,881
170818 Caterpillar 980K 5,132 6,132 7,132 8,132 9,132 10,132 11,132 12,132 13,132
170819 Caterpillar 980K 4,670 5,670 6,670 7,670 8,670 9,670 10,670 11,670 12,670
170820 Caterpillar 980K 4,397 5,397 6,397 7,397 8,397 9,397 10,397 11,397 12,397
170821 Caterpillar 980K 4,201 5,201 6,201 7,201 8,201 9,201 10,201 11,201 12,201
170822 Caterpillar 980K 3,586 4,586 5,586 6,586 7,586 8,586 9,586 10,586 11,586
170823 Caterpillar 980K 2,512 3,512 4,512 5,512 6,512 7,512 8,512 9,512 10,512
170824 Caterpillar 980K 1,945 2,945 3,945 4,945 5,945 6,945 7,945 8,945 9,945
170825 Caterpillar 980K 1,907 2,907 3,907 4,907 5,907 6,907 7,907 8,907 9,907

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 Rebuild Considerations
• Frame strength and integrity
• Current technology/emissions adequate or
upgrade needed?
• Is machine sized for rebuild cost effectiveness?
– Minimum size for a powertrain rebuild 45-50K lbs.
– Minimum size for a complete rebuild 100K lbs.
• Cost of rebuild
– Powertrain rebuild 35-40% of new (dealer)
– Complete rebuild 60-65% of new (dealer)
• Availability of standard or extended warranties

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 Comparison Formula Example

Replace vs. CCR Rebuild vs. CPT Rebuild:

(new cost x rebuild cost factor) / proj. life in hrs. = CPH

New Machine: $450,000 / 12,000 projected life = $37.50/hr.

CCR Rebuild: ($450,000 x .65) / 9,600 = $30.47/hr.

CPT Rebuild: ($450,000 x .40) / 9,000 = $20.00/hr.

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 Recap
• Art or science?
• What keeps us up at night?
• Considered 8 tough questions
• Examined the action spectrum
• Looked at numerous tools we can use
• Discussed various dealer resources
• Addressed maintenance effectiveness & reliability
• Repair before failure
• Condition based maintenance
• Fleet replacement planning
• Rebuild rules of thumb, considerations & cost analysis
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Prevention is always better than cure – Be Proactive
Have a Plan!

Questions?
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