It is well known that the cumulative owning cost per hour of a new machine during its initial operation is high and operating costs are low. However, over time, this scenario is reversed. When the machine’s cumulative net revenue per hour becomes less than the total cumulative owning and operating costs per hour, the machine will steadily start eating into profit margins.
At this point, the question is: replace, or extend the original investment by opting for a rebuild?
Caterpillar offers two rebuild programmes, namely Cat Certified Rebuild and Cat Certified Power Train. In both instances, the programmes must meet the standards specified by Caterpillar, including the incorporation of the latest critical engineering updates for specified Cat models.
Alternatively, customers have the option of specifying a dealer rebuild. In the case of the latter, the customer has the choice of selecting a customised rebuild without needing to carry out the mandatory product updates required when going the Cat certified rebuild route.
The estimated cost for a Cat certified rebuild can be as little as 65% of the price of a new machine; whilst a dealer rebuild costs about 50%. However, only Cat certified rebuild units will be issued with a new serial number.
On the Cat certified rebuild programme, the entire machine is rebuilt, including the power train; whilst on the Cat certified power train option only the power train is completely rebuilt. Either option will depend on the current condition of the machine.
“However, the Cat certified rebuild programme doesn’t end with the rebuild process,” Wally Parsons, senior product manager: aftersales at Barloworld Equipment, the exclusive Caterpillar dealer for southern Africa, explains. “The value of the machine is further increased with parts warranties, plus an extended power train coverage option from Caterpillar.”
Parsons adds, “The expected life after a Cat certified rebuild should be in the region of 60% to 80% of the original hours achieved.”