Rebuilding Logging Equipment

[John C.]

When I first started in the business it was common to rebuild large expensive things like stackers, articulated front end loaders and some logging shovels. The cost and shortage of qualified labor, cost of parts and limited financing options killed the rebuild markets in the mid to late eighties for most of the iron. Yarders seem to be the only thing that can be rebuilt these days and most have had several tear downs and rebuilds. I suspect that is because of the supply of new means rebuilding is virtually the only solution.

I'm wondering with all the "new" technology and its associated learning curve and problems we haven't found yet, what the market opinion would be for quality rebuilt machinery? With the price of a shovel logger running north of $400,000, at what price level would you consider a rebuild? What operating hour level would be the right place to do that rebuild? What range of years or models would you consider?

 

[kiwi450x]

An intriguing question, and I would think, with limitless answers. Probably depending on your outlook on life. Part of the problem can be that a lot of the machine is toast at the same time, we have some reasonably old log loaders (excavator based) in our system and they're still going strong but there will come a time when they die and we're gonna have some hard decisions to confront. For instance, we have a 20k hour Cat 322c which just won't give up. But when the pump (for instance) dies, we'll be staring down the barrel of rebuilding that, knowing the motor is not a mile away from going bang, the final drives and valve bank are well worn too, and the rest of the machine is getting baggier as time goes on as it's the learner machine in the fleet now. All the wannabes and dreamers that think they can operate a machine but don't know how to replace a cartridge in a grease gun, are taking a toll on the old girl now...
A complicating factor is that I/we have a soft spot for the machine as it's paid for itself a couple of times over and I put 10k hours on it myself in its younger days. Out of interest, I asked Goughs to give me a rough quote for a ground up rebuild six months ago and the number was horrific. Pretty sure it was close to a 200k. Which I would do in a heart beat if the lotto numbers went my way, but my lotto career isn't going anywhere at the moment... LOL

So what do you do? Tip money into the pump (for instance, or whatever else goes first) knowing everything else is toast? Knowing that once you've done the pump, you're committed then, and if the motor goes, you'll have to do that. Then you really committed, and by default you end up doing the ground-up rebuild, and your machine is still worth bugger all to sell...

Or you can ring the sales man and price up a new toy and it's much easier to find finance for that, and so on. Interesting times indeed.

 

[kiwi450x]

I'm the same as far as yarders go though, I'd rebuild ours until the cows come home. The price of a new one is just so high now, we're better to keep the existing one going. We're pondering doing a pre-emptive strike on the transmission of ours this summer as it has 20k hours on it and we haven't touched it. We thought we might pull it out and give it some loving before anything goes wrong in there. It's easier in summer as we can ground base and road-line while the hauler is parked. If it lets go in the middle of winter, life gets a little more tricky... LOL

 

[John C.]

Thanks for the great response. I would think that it would be a little far down the operating road for a rebuild at 20,000 hours but I have seen a couple of those machines in sawmill use run 35,000 hours with the original engine and pump. They were the exceptions though as the dealer did all the maintenance to get them there. I've seen a few machines working the brush that were junk at 12,000 hours.

What I'm wondering is if it were possible to rebuild a machine and sell it for about 65% of new or less. We have plenty of people who don't like the idea of a furnace sitting on top of a pile of wood chips or saw dust in the summer. Digital control handles scare the heck out of many operators. Six plus years of operation to pay a new one off would scare the heck out of anyone. Would financing even be available for a rebuilt unit? Would the bankers participate?

What advice would you give about the numbers of hours one would be able to rebuild from? How in depth should the rebuild be? I know I would need undercarriage, engine, pump, swing machinery, final drives, radiator and hydraulic oil coolers. What about wiring harnesses? Some machines would need slewing bearings. What else should be gone through?

 

[kiwi450x]

I'm far from an expert on these things but I would suggest that it's much easier to get finance for new gear, even though the cost is greater, because the value is a known quantity. It's easier for the finance reps to get past the risk assessors because they have a much better grip on the value of the machine going forward. I would say that yes you could get finance to buy a rebuilt machine but you would need more equity in it yourself as there is a bigger element of risk involved. All the finance companies care about is risk management and your ability to pay. As long as you have a decent chunk of equity you should be good to go.

I agree that at 20k hours we've let the old girl go on to long, but it just won't die. That C series loader leaves all our D series machines for dead when it comes to reliability. But like I said earlier, we do have some ****** decisions looming on the horizon...

Your last paragraph is the million dollar question and it probably keeps countless contractors awake at night... I could happily argue those questions from either side of the coin.

One other fly in the ointment, as far as rebuilding gear goes, is that it's easier to find good operators with new or late model equipment, and staff will make or break a logging company. That's probably another reason why contractors just keep turning machines over...

 

[Vigilant]

If rebuilding old equipment becomes a new trend, I suspect EPA will find a way to screw it up, and perhaps OSHA as well.

 

[Plebeian]

That is really too many questions #1 to answer in a short reply.
A lot depends on where in the world you are and what activity the machinery is doing. Acreage to be harvested, Log size, tree type, terrain, availability of skilled operators, maintenance crew etc
If you look at the example of the high hour Caterpillar 322CL.
Replace with new. There is the 'E' series now so with the 320E L models with a similar weight and engine power to the 322cl or the 324 EL with more engine power and weight. or the D FM models.
(Edit - there still appears to be new D series machines going into the forest 336 D2L etc)
Change the brand of excavator base with Forestry conversion or another specialist forestry/ logging designed machine - John Deere, Tigercat. (It just depends where the contractor purchasing/ leasing the machine thinks or wants his logging operation/ business to be heading) (Edit - new excavator bases - standard to modified of many brands still going into the forest - Hitachi, Komatsu, Doosan, Sumitomo, Hyundai, Volvo, etc

Rather than new build large yarders in some places there will be low hour large excavator bases or Cat 568 type machines converted to a 'Super Yoder' format that can take on the haul duties should the main (many times rebuilt) yarder or new type small telescoping tower yarder have a serious breakdown.

Used - For the wood chip pile, saw dust - used machines (from earth moving ops etc) with a good automatic fire suppression system.

Asia/ China - I would expect the likes of Yuchai, Sany etc to have custom build divisions - that make more logging machines than present. http://www.diggalink.co.nz/yc270lc-9f-forestry-excavator

The way the high hour machine will be rebuilt, is it might be loaded up on a ship as scrap metal to be sent to Asia to be melted down to make a new excavator etc.

 

[kiwi450x]

Good post Plebian, and I agree, there are plenty of approaches one could take... I'll let the E series stuff settle in a little before we go down that road I think. The first 320E in town is still in the workshop at the moment. Lots of astute people seem to take the attitude that you never buy out of the first run of anything. Be it utes, ag tractors or excavators and I'm inclined to agree with them. Let someone else iron out the gremlins.

 

[John C.]

I take it then that the companies in New Zealand would rather have new iron and not consider anything rebuilt?

 

[kiwi450x]

I guess it's fair to say that all the forest companies care about is that you produce what you say you're gonna produce. What gear you do it with, they don't really mind. That said, it's easier to be reliable with late model gear and it also gives the forest companies confidence in your business. That's my experience with the companies we work for. As an aside though, when we're in the market for new gear, I normally have a yarn with the company and make sure what we're looking at fits with their vision, it helps if they're on board with what you're doing.

In these days of ****loads of electronics, rebuilding seems less attractive to me. I reckon the Madill log loaders seem to be ideal candidates to be rebuilt a couple of times, due to the simplicity, but your late model Japanese excavator, not so much.