Heavy Machinery Overhaul or Repair?

Heavy equipment is a major investment for any organization. When machinery starts showing issues, you want to address them in the most economical way. While repairing a machine might have a lower upfront cost, sometimes equipment overhauls can be better in the long run. It’s important to understand factors like finances, the equipment’s age and its condition before making a decision to replace or repair.  

Should You Rebuild or Replace Your Heavy Equipment?

As equipment ages, it will require more repairs. The 50/50 threshold rule can help you decide when to replace equipment. It states you do not need to replace a machine until its repair costs exceed more than half the cost to replace. While it’s a helpful rule in some situations, the point of failure can look different depending on the machinery. 

The following factors can inform your decision to replace or rebuild equipment: 

• Your equipment is covered under warranty.
• You still owe payments on your equipment.
• The rebuild would improve the equipment’s performance.
• The equipment has resale value to offset overhaul costs.
• You can afford to pay taxes on replacement equipment.
• You would see optimized operation costs for rebuilding or replacing the equipment, such as longevity.

When to Rebuild Equipment 

Rebuilding involves swapping out your equipment’s major components and minor elements. The process can restore your equipment to like-new condition and extend its life span. Rebuilding is often the more cost-effective, long-term option. Instead of carrying out multiple repairs, you can upgrade everything at once, including the engine. 

Rebuilding might be the better option in these scenarios: 

You’re Facing High Repair Expenses

Rebuilding can be more cost-effective if the price of repairs exceeds the cost of rebuilding by more than half its value.

Your Equipment Meets Operational Requirements

Rebuilding can give your construction equipment a second life. If it already gets the job done, rebuilding may lead to better results than a complete replacement.

Your Equipment Requires Upgrades

If you want to accomplish more with your equipment, rebuilding may be better. Rebuilds allow you to upgrade your equipment. For example, you can fit it with newer technologies and accessories to improve its performance.

You’re Working With Limited Funds

Rebuilding is often the less expensive option compared to a new equipment purchase. Many companies that offer rebuild services provide financing options to make it even easier to afford.

Pros and Cons of Equipment Rebuilding 

Weigh the pros and cons to determine whether you should rebuild your construction equipment. Rebuild benefits include: 

• Improved performance: Upgrading to new parts with a rebuild can greatly improve a machine’s overall performance. 
• Extended life: Rebuilds can help extend your equipment’s life span, giving you more time until a replacement is needed.
• Increased value: You can get a higher return on investment if you decide to sell your equipment in the future.
• Warranties: Many companies — like Puckett Machinery — offer rebuilds that qualify for like-new financing and warranties. 

While a rebuild can deliver optimal results in many scenarios, it can come with some cons:

• Can be more expensive than repairs: While it’s often less expensive to rebuild than overhaul, costs can be higher than the price of making intensive repairs. Weigh your options to determine if it’s worth it in the long run.
• Offers like-new condition rather than brand-new: Although a rebuild can provide optimal performance, it’s not the same as a brand-new piece of machinery. Even with regular maintenance, you may face a shorter life expectancy for rebuilds than replacements. 
• Lack of available parts: Keep in mind that it’s not always possible to source parts and rebuild some heavy equipment models, like older models.

When to Replace Equipment

Here are some signs you might want to replace your equipment rather than rebuild it: 

Your Equipment Is Beyond Repair

If your equipment is old or has several mechanical problems, it might cost more to repair than replace. In this case, investing in a high-quality used product may provide a negligible price difference and better long-term performance results.

You Have Time Constraints

Rebuilding a piece of construction equipment can be a lengthy process, especially if it requires more extensive work. If your organization cannot afford the downtime, you might consider replacing the machine by purchasing it new, used or investing in a long-term rental.

You Would Have Lower Operating Costs

Rebuilding may provide improvements in performance and efficiency. At the same time, these upgrades might not match what a new product can deliver. While initial costs may be higher, a replacement could have a more meaningful impact on your company’s bottom line. 

Pros and Cons of Equipment Replacement

The benefits of replacing your machinery include:

• Longer life span: Buying new equipment is often the better solution for a long-lasting fleet.
• Improved performance: A rebuilt machine can often meet your efficiency expectations, but some equipment types may face limitations. In these cases, a replacement could offer better results, especially if you want to improve performance.
• Lower operating costs: While rebuilds can sometimes reduce the frequency of repairs, a new model replacement might result in lower expenses due to its better condition and fewer service hours. 

Drawbacks of equipment replacements include:

• Higher cost: Purchasing a new piece of construction equipment could end up costing you a lot more than rebuilding. The option might not be best if you have limited funds and want to stretch your budget further.
• Potential long-term commitment: Buying new equipment often involves financing the purchase. This can create a financial responsibility that adds debt and makes it harder to access capital in the future. 
• Learning curve: It can take a longer time for operators to adjust to a new machine. The learning curve can make project deadlines tighter and increase accident risk until your team becomes more familiar with the equipment.

Puckett Machinery Can Help You Replace or Rebuild Equipment

When it comes to replacing vs. rebuilding machinery, consider your finances and your specific equipment issues. If you’re having trouble deciding the right course of action for your specific situation, Puckett Machinery can help. We offer new construction equipment and rebuild options to help you boost productivity and stay within budget. Our highly trained technicians ensure our rebuilds are as close to a new Cat® machine’s quality as possible.

Whether you’re looking for new, used, rental or rebuild options, let us partner with you to meet your unique needs. Contact us to learn more about our services.