BigWrench55
Senior Member
I've been to those mine sites in AL. And I seen the draglines you speak of. I'm about 25 years or so behind you. Of course by the time I got there the unions chased Drummond out of AL. And the mines were closed.
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When is it financially adventageous to rebuild machines?
- Thread starter Questionable wizard
- Start date
Tugger2
Senior Member
In 1980 i was working for a logging outfit that was able to take advantage of available resources and man power during the the economic downturn. We set up a first class shop with in house capability and man power to do full rebuilds on every thing from rigid frame logging trucks ,980 s ,D8s ,American log loaders to side winders and dozer boats. We had Detroit guys, Cat guys ,Machinists ,Heavy duty Mechanics and welders. We turned out good work , built innovative attachments and equipment. I think the bottom line was good for the company until operations were curtailed by other factors .
Certified rebuild seems like a good plan
We have done a lot of in house rebuilds on small equipment like backhoes I just had a hydro shop do a full set of rams last year and we rehosed a complete machine for like 15 grand I can fo a pump engine and trans with a rebuild warranty for about 25 if we pull the components ourselves so my 446 backhoe can basically be rebuilt with a paint job and new seats for about 60 to 70 grand my cost of time included considering a new machine is 200k I think it's a good deal
I have a friend that has done a 314 ex in stages did hoses rams and pump one year then motor and circle another year then under carriage pins and bushings the next year he has about 80 to 90 grand in the machine to rebuild it at 14k hours should be good for another 10k hours now at less than half of new granted there's no warranty but as far as money that's a win every day
We have done a lot of in house rebuilds on small equipment like backhoes I just had a hydro shop do a full set of rams last year and we rehosed a complete machine for like 15 grand I can fo a pump engine and trans with a rebuild warranty for about 25 if we pull the components ourselves so my 446 backhoe can basically be rebuilt with a paint job and new seats for about 60 to 70 grand my cost of time included considering a new machine is 200k I think it's a good deal
I have a friend that has done a 314 ex in stages did hoses rams and pump one year then motor and circle another year then under carriage pins and bushings the next year he has about 80 to 90 grand in the machine to rebuild it at 14k hours should be good for another 10k hours now at less than half of new granted there's no warranty but as far as money that's a win every day
John C.
Senior Member
I worked at a coal company where I would joke that we were rebuilding machines completely one year at a time. This year and engine, next year the tranny and torque, the year after the undercarriage and the year after that the hydraulics. Problem was that the breakdown rate on the machines never changed.
Standard rule when I worked for the dealers was that you should pay no more than sixty five percent of new for a frame up and the machine had to last a minimum of that sixty five percent of that first life for that money. The problem was always the second part of that equation. Today the issue is moot. Unless you have the funds to do it on your own dime. You can't afford three profit margins unless your finished product profit margin is huge.
Standard rule when I worked for the dealers was that you should pay no more than sixty five percent of new for a frame up and the machine had to last a minimum of that sixty five percent of that first life for that money. The problem was always the second part of that equation. Today the issue is moot. Unless you have the funds to do it on your own dime. You can't afford three profit margins unless your finished product profit margin is huge.
DMiller
Senior Member
Utility I worked for, would buy equipment on a Five to seven year plan, run out regardless to the final year, review maintenance history and trade or continue operation Year to Year after that. First major component failure got repaired used slightly then machine sent to Dead Line to be sold off.
Something of note since this in the scraper thread csw a civil contractor here locally that went under 2 years ago cause they tried venturing out of there area of expertise
But they had a shop downtown that rebuilt components in house they had another shop that would do major rebuild work on there equipment the biggest asset they had was if they had a catastrophic failure they had components rebuilt ready to go and down time was marginal because they didn't have to go to a dealer for said support unless in that instance it was convenient the cost control that comes out of that capability is vital in the dirt moving buissness
For the most part in my buissness model I dont see the rebuilding or 2nd life as a downtime preventer except for major things like power train but i see it as a reinvestment in a machine that should do a simalar hour life at a cheaper cost you already really have the down time factored in if your playing the game this way yes it does take some pockets to pull it off but it's more profitable and can run on leaner margins should you require it
The reverse side is and especially true for the small guys is that one machine is the only size in the fleet for that job there is no redundancy and in housing a mechanic that has the capabilities and tooling may be out of financial reach but the biggest driver is a dealer supported loaner machine to make the downtime a non factor take the loaner program out of the dealer and it make a whole lot more sense
Other big drivers in rebuilding of any machine in the last 10 years is the technology progression at a point in the not so distant future the tech curve will flatten dramatically and the production efficiency will level off from one series to the next and that will start to change the game from what the market is today especially as the new machines become more reliable through tech progression
But they had a shop downtown that rebuilt components in house they had another shop that would do major rebuild work on there equipment the biggest asset they had was if they had a catastrophic failure they had components rebuilt ready to go and down time was marginal because they didn't have to go to a dealer for said support unless in that instance it was convenient the cost control that comes out of that capability is vital in the dirt moving buissness
For the most part in my buissness model I dont see the rebuilding or 2nd life as a downtime preventer except for major things like power train but i see it as a reinvestment in a machine that should do a simalar hour life at a cheaper cost you already really have the down time factored in if your playing the game this way yes it does take some pockets to pull it off but it's more profitable and can run on leaner margins should you require it
The reverse side is and especially true for the small guys is that one machine is the only size in the fleet for that job there is no redundancy and in housing a mechanic that has the capabilities and tooling may be out of financial reach but the biggest driver is a dealer supported loaner machine to make the downtime a non factor take the loaner program out of the dealer and it make a whole lot more sense
Other big drivers in rebuilding of any machine in the last 10 years is the technology progression at a point in the not so distant future the tech curve will flatten dramatically and the production efficiency will level off from one series to the next and that will start to change the game from what the market is today especially as the new machines become more reliable through tech progression
BigWrench55
Senior Member
A lot of factors go into the rebuild of equipment that makes it financially viable. Places that have 24/7 operations will benefit more than the local dirt contractor. Big 24/7 operations like mining also plan in advance and have a plan of action. They usually have everything in place before they decommission a machine. And usually that machine is brought in before things are to roached. With careful planning and planned downtime it could be economically viable for anyone to rebuild. But if you think that you can just simply shutdown your machine and have a couple mechanics go through it. Then prepare to pay way more than what would justify the build and not see your machine back in action for a year. I have been part of a number of rebuilds. Most were successful and some were disasters. The disasters were poor planning and a scorched earth approach. But you must run the numbers and have someone that can deal shrewdly with the dealer or it will never work.