Construction Equipment

Management
Dr. I M S Sathyaprasad
Senior lecturer, Faculty of Engineering,
University of Peradeniya

MA605 - Construction Technology,

23 November 2019
Overview
 Construction Equipment Planning
 Economics of Construction Equipment
 Estimation of Output /Production Rate of
Equipment
 Maintenance Planning
 Optimising Operations

MA605 - Construction Technology, 9

April 2016
Construction Equipment Planning
Involves deciding about
 Extent of Mechanisation
 Forecasting equipment requirements
 Method of acquisition
 Planning of maintenance of equipment
 Disposal of equipment after the work

MA605 - Construction Technology,

9 April 2016
Extent of Mechanisation
Depends upon many factors;
 Availability of manpower (or lack of it)
 Tightness of project completion
 Nature of work (certain activities are beyond the human labour
to perform)
 Quality of work expected
 Affordability of equipment
 Availability of sales and service agents in the area
 Social aspects (unemployment, seasonal fluctuations in labour)

MA605 - Construction Technology,

9 April 2016
Extent of Mechanisation
 Can be different from country to country, project to
project, or, activity to activity of a project
 Mechanisation is advantageous when the work is tough,
quantum of work is high, expected quality is high, need
to adhere to schedules, has to work in severe job
conditions, and has to work in an unfamiliar area or
conditions
 Disadvantages include the need for initial heavy
investments, loss of employment opportunities, loss of
productivity in downtime, way of disposing after use etc.

MA605 - Construction Technology,

9 April 2016
Forecasting Equipment Requirement
Decision on the Type, Brand, Size and Fleet
 Number of equipment needed may be reduced by
increasing the number of shifts (depends upon the type
of work)
 However, double shifts achieve only 60-70% extra
work whereas triple shifts only 110-125% extra work,
compared to single shifts
 Multiple shifts need higher standby capacity. For single
shifts 10% standby is the norm and for double and
triple shifts 20% and 30% respectively. (depends upon
the type of equipment)
MA605 - Construction Technology,
9 April 2016
Forecasting Equipment Requirement
Number and Sizes depend on;
 Quantum of work (larger quantum of work  bigger
machines)
 Working days available
 Number of shifts planned
Type of Equipment depends on;
 Nature of work
 Site conditions
 Versatility

MA605 - Construction Technology,

9 April 2016
Forecasting Equipment Requirement
When multiple units are needed, match the brands and
sizes in the fleet (Standardisation)
 Lesser burden on spare parts stock
 Lesser burden on maintenance staff, especially
mechanics
 Interchangeability of operators in the fleet
 Ease of estimating productivity and convenience in
optimising the operations scheduling
 Possibility of getting discounts at the procurement

MA605 - Construction Technology,

9 April 2016
Forecasting Equipment Requirement
Selection of a brand depends on;
 Availability of sales and service agents in the area
 Company’s past experience on the performance of the
brand
 Availability of operators and mechanics trained in the
particular brand
 Shorter time of procurement
 Availability of spare parts in the area
 Possibility of resale after use
 Economic aspects

MA605 - Construction Technology,

9 April 2016
Forecasting Equipment Requirement
Scientific Planning of Equipment Requirement
 Identify the quantum of work (from detail drawings, site
investigation, limitations in working space etc.)
 Estimate the real output / capacity of the equipment (depends
on soil types, altitudes, working conditions, operators’ efficiency,
fleets matching etc.)
 Estimate the utilisation of the machines and time period (try to
match the economic life of equipment with project duration –
through number of shifts)

MA605 - Construction Technology,

9 April 2016
Methods of Acquisition
 Purchasing 4000

Annual Total Cost

3000
 Hiring

(1000 Rs.)
2000
 Hiring with and option
1000
to purchase later
0
0 1000 2000
Annual Utilisation (hrs/yr)

Purchase
Hire
Hire with an option to Purchase

MA605 - Construction Technology,

9 April 2016
Economics of Construction Equipment

 Basis of Costing  Hourly Working Rate

Hourly Working Rate (Rs./hr.)

 Unit Cost (Rs./unit) = ----------------------------------------
Rate of Production (units/hr.)

MA605 - Construction Technology,

9 April 2016
Economics of Construction Equipment
Hourly working rate is obtained by considering;
 Annual cost of owning and hourly cost of operating the
equipment
 Annual utilisation of the equipment
Annual utilisation depends on shift operations;
 Single shift operation – 1500 hrs
 Double shift operation – 2500 hrs * Typical Values
 Triple shift operation – 3200 hrs

MA605 - Construction Technology,

9 April 2016
Owning Costs
Usually calculated as Annual Costs
 Investment Cost
 Interest on the money invested
 Taxes and duties
 Insurance
 Storage costs
 Depreciation Cost
 Depreciation (due to wear and tear, physical decay, accidents)
 Obsolescence (becoming out-of-date)
 Major Repairs Cost
MA605 - Construction Technology,
9 April 2016
Owning Costs
Depreciation Cost
 A company may adopt a reasonable method
 StraightLine Depreciation method
 Sum-of-the-years’ Digit method
 Declining Balance methods
 Machine Hour Basis method

MA605 - Construction Technology,

9 April 2016
Owning Costs
Annual Cost of Depreciation
 Simplest method  Straight line Depreciation
 Assumes that the loss of value of the equipment is
proportional to the time
 Needs three variables to estimate
 Purchase price - P
 Economic life of the equipment - n
 Salvage value (Resale value or Scrap value) – S
 Annual Cost of Depreciation = (P – S) / n

MA605 - Construction Technology,

9 April 2016
Owning Costs
Investment Costs
 Best Practice  Use the actual records
 Rule of Thumb: 20% of Average Value of the
Equipment as the Annual Cost of Investment
 12% as the Interest on money invested (use actual
percentages if known)
 8% as Taxes, Insurance and Storage

MA605 - Construction Technology,

9 April 2016
Owning Costs
 Average Value of the Equipment (À) for
Investment cost calculations
(n+1) P + (n-1) S
 À = --------------------------------
2n
 Where P, S and n have their usual meanings as
in depreciation cost calculations

MA605 - Construction Technology,

9 April 2016
Owning Costs
Major Repairs Cost
 Minor repairs are carried out during day-to-day working
and are therefore considered a variable cost 
considered under cost of operation
 Major repairs and overhauls need heavy expenditure
and are therefore considered as met by the Major
Repairs Fund, that gets uniform contributions from
each year’s earnings
 Usually taken as a percentage of annual depreciation (80
~ 200%, depending on the type of machine)

MA605 - Construction Technology,

9 April 2016
Operating Costs
Usually calculated as hourly costs and includes;
 Cost of Fuel
 Cost of Lubricants
 Cost of Other Oils (hydraulic, grease etc.)
 Cost of minor repairs
 Cost of labour (if not considered elsewhere)

MA605 - Construction Technology,

9 April 2016
Operating Costs
Cost of Fuel
 Estimated using the price of fuel (Rs./lit.) and hourly
consumption of fuel (lit./hr.)
 Fuel consumption varies with
 Engine horsepower (fly-wheel horsepower)
 Operating factor (average percentage of full power the
machine is operating at, during the operation)
 Specific fuel consumption of the fuel type in IC engines
 0.04 gal/ fw-hp. hr (for diesel engines)
 0.06 gal/ fw-hp. hr (for gasoline engines)

MA605 - Construction Technology,

9 April 2016
Operating Costs
Operating Factor
 Engine factor * Time Factor
 Example: If an operating cycle contains three
phases loading, travel and unloading that last for
t1, t2 and t3 and the percentage of full power
needed at the three phases are e1, e2 and e3 then;
 Operating Factor = ∑ (ei * ti ) / ∑ ti

MA605 - Construction Technology,

9 April 2016
Operating Costs
Cost of Lubricants
 Estimated using the price of lubricants (Rs./lit.) and
hourly consumption of them (lit./hr.)
 Lubricating oil consumption depends on;
 Engine horsepower
 Operating factor ( f )
 Crank case capacity ( c ) in gal
 Average time between successive oil changes in hours ( t )
 Specific lubricating oil consumption 0.006 lbs / fw-hp.hr

MA605 - Construction Technology,

9 April 2016
Operating Costs
Fuel consumption (diesel) – in gal/hr
= Hp * f * 0.04
Lubricating oils consumption – in gal/hr
 = Hp * f * 0.006 / 7.4 + c / t
Note: Density of Lubricating oil = 7.4 lbs/ gal

Multiply by 4.5 to get the answer in Lit/hr

MA605 - Construction Technology,

9 April 2016
Operating Costs
Minor Repairs Cost
 Cost of minor repairs, tire repairs, replacement
of filters, batteries etc.
 Usually go by the actual costs or past records of
the company

MA605 - Construction Technology,

9 April 2016
Operating Costs
 Labour cost is usually considered separately
from the equipment
 If considered included in equipment cost,
consider salaries/ wages, EPF, ETF, other
allowances, other fringe benefits etc. and divide
by the annual utilisation of the equipment to get
the hourly cost

MA605 - Construction Technology,

9 April 2016
Productivity of Equipment
Three approaches;
 Actual production rates (through observation
when the equipment at work) Best practice
 Equipment specifications (good only for new
machines)
 Output formulas developed by researchers

MA605 - Construction Technology,

9 April 2016
Productivity of Equipment
Output Formulas
 Depends on the type of machine
 For Example, for a power shovel;
 Variables:
 Engine horsepower
 Type of materials being handled
 Depth of cut
 Angle of swing
 Job conditions / Management conditions

MA605 - Construction Technology,

9 April 2016
Productivity of Equipment
 Output of a power shovel (P) cum./hr.

P = Pi * f * f1 * f2 * t
Where Pi - Ideal output
f – Earth volume change conversion factor
f1 – modification factor for depth of cut and angle of swing
f2 – modification factor for job and management conditions
t – modification factor for operating time

MA605 - Construction Technology,

9 April 2016
Maintenance Planning
 Breakdown maintenance
 Due to unpredictable failure of components
 Defects are rectified only when machine cannot perform any
more
 Downtime costs are high
 Preventive maintenance
 Maintenance is done at pre-planned schedule
 Downtime costs are lower
 Regular cost is higher

MA605 - Construction Technology,

9 April 2016
Maintenance Planning
Preventive Maintenance
 Scheduled inspection / check ups
 Servicing
 Keeping records and analysis
 Training of maintenance staff
 Storage of spare parts
 Schedule different machines to undergo maintenance at
different times in a schedule
 Making machines needing maintenance idle at the
scheduled times
MA605 - Construction Technology,
9 April 2016
Optimisation in Construction
Equipment Planning and Operation
 Break-even analysis
 In equipment selection
 In maintenance
 Fleet matching
 Equipment management between different sites

MA605 - Construction Technology,

9 April 2016
Some Examples

MA605 - Construction Technology,

9 April 2016
 Some Examples
A backhoe excavator has a bucket capacity of 0.85 cu.m.
(average heap capacity). This excavator is used to excavate a
trench. Following time measurements (average times) are
observed at the site.
• excavation = 60 s
• Swinging and lifting = 30 s
• unloading = 10 s
• swinging back = 20 s
• time lost between cycles = 10 s
Find the cycle time of the operation
Find the hourly out put of the machine

CE583 – Construction Planning

Wednesday, June 21, 2017
Example 2
 A construction company owns a fleet of off-road dump trucks with
capacity 10 cu.m each. These trucks are used to haul excavated
earth from a stockpile to a disposal site located 3 km away. A two-
cu.m wheel loader is employed to load earth from the stockpile to
the dump trucks.
 An undergraduate trainee assigned to the site makes following
observations.
 Average cycle time of the wheel loader 2 min
 Speed of the dump trucks with load 12 km/h
 Speed of the dump trucks without load 15 km/h
 Average unloading time of the truck 2 min
 Average time lost due to waiting etc. 1 min (per truck trip)
 Estimate the minimum number of dump trucks needed to keep the
wheel loader busy.
 If the hourly costs of the wheel loader and a dump truck are Rs.
2,000.00 and Rs. 1,000.00 respectively, find the unit cost of the
operation in Rs/cu.m.
An Example from coastal dredging
 A large-scale commercial supplier invests on a off-shore
sand supply facility where sand will be mined from off-
shore resources using a Trailing Suction Hopper
Dredger (TSHD), pumped to the shore using a floating
pipeline, washed to remove salts using an Aggregate
Washing Plant (AWP) and stockpiled at the storage area
using a fleet of wheel loaders.
 TSHD has to sail to the sand borrow sites, dredge sand,
sail back to pumping location and pump sand to shore
before it leaves for the borrow sites again. The facility
operates round the clock and the working staff will be
working in shifts. The facility operates 300 days a year.
Trailing Suction Hopper Dredger
– Selat Melaka
The Booster Pump – Vlaanderen XI
Laying of Floating Pipeline
Coupling Pipelines
Dredging Arm of TSHD
TSHD in Dredging
At the Sand Disposal Sites…
 Example (contd.)

 Cycle time of the TSHD 6 hrs.

 Hopper capacity of TSHD 4,000 cu.m.
 Average processing rate at AWP 1000 cu.m./hr

 Handling cost of wheel-loaders 20 Rs./cu.m

 Annual cost of owning and operating the TSHD Rs.
96,000,000.00
 Hourly cost of owning and operating the AWP Rs. 20,000.00

Example (contd.)
 How long does the AWP and rest of the yard facilities must
operate in a day? Assume that the sand pumped to the shore
may be processed not necessarily at the time of pumping
itself.

 Assuming 25% mark-up to cover overheads and profits, find

the selling price of sand at the stockpile of the facility.