1. Unit 5 Construction Equipment
Equipment economics
Dr. Bhupali Dutta
Assistant Professor
Department of Civil Engineering
2. Basic questions in equipment management
• Advantages of using equipment or machinery
• Disadvantages of using equipment or machinery
• Factors considered in the selection of equipment
3. Fundamental cost of equipment
economics
Economics of construction equipment includes the following:
• Cost accounting process pertaining to the working of the machinery
• Computation of plant use rates
• Computation of unit cost of production
Equipment cost = Ownership cost + Operating cost
• Ownership cost: Fixed cost incurred irrespective of the quantum of
use. Also known as Performa charges
• Operating cost: Directly related to the quantum of use and efficiency.
It is incurred at the site
4. Ownership cost
• Total cost related to the
construction equipment in order to
own it.
• Components of Ownership Cost
Initial Cost
Depreciation
Salvage Value
Taxes
Insurance Cost
Storage Cost
Interest Cost
5. Operating cost
• Comes into play only when the machine
starts to operate.
• Depends on the period of operation
(hours), location of the construction
site, the site conditions under which the
machine is operated, the type and
category of the equipment.
• Includes the following also:
Cost of filter, grease and lubricating oil
The wage of Equipment Operator
Cost of Replacement of high wear parts
of equipment
Mobilization, demobilization and
Assembling Cost
6. Factors influencing the performance
of equipment
• Performance depends on the maintenance of equipment
• Maintenance includes keeping the various components in original
condition to ensure safety and efficiency in its operation
• Objectives of maintenance
To keep the equipment in optimal working order
To ensure long life of machinery to avoid high rate of
depreciation of capital
To maximize availability of machinery
To minimize downtime due to breakdown of machinery
7. Requirement of maintenance activity
Resource loss and production loss
An unexpected breakdown can result in labour overtime
Insufficient knowledge of machine life cycle
Scheduling work and projects again
9. Failure-based maintenance:
Advantages Disadvantages
Lower initial cost Increases cost due to unplanned downtime
Requires fewer staff Increases labour cost when there is
overtime for untimely repairs and
replacement
Cheap and easy to
implement
Increases cost associated with repair or
replacement
• Represents a reactive approach to maintenance.
• Use a piece of equipment until it breaks down.
• It is suitable for equipment with low repair costs and when equipment
breakdown won’t cause big operational issues .
• Still predominant in India
10. Condition based maintenance
• Detect the onset of equipment degradation
• Significant deterioration can be eliminated or controlled
• Inspects both current and future functional capabilities
• Condition monitoring sensors required. These sensors give you real-
time insight into the health of your assets.
Advantages Disadvantages
Increases operation life and availability Increases investment in diagnostic
equipment
Decrease in equipment and process
downtime
Increases investment in staff training
Provides better quality, lowers labour cost
and improves worker and environmental
safety
11. Time based maintenance
• Upgraded version of CBM
• Involves using predictive analytics and algorithms (based on data
coming from condition monitoring sensors) to predict exactly
when a piece of equipment is expected to fail so you can schedule
maintenance just before that happens.
• Involves the following activities:
Periodic inspection of equipment to prevent breakdown or
harmful depreciation
Upkeep of equipment to minimize downtime and breakdown
Technologies: lubricating, cleaning, replacement and inspection
12. Advantages Disadvantages
Provides flexibility for adjustment
of maintenance periodicity
Does not eliminate catastrophic
failures
Increases component life cycle It is more labour intensive
Increases cost and energy savings
Time based maintenance
13. Pro-active maintenance
• Uses information provided by predictive methods to identify
problems and isolate the source of failure
14. Do’s and don’ts of maintenance
Do’s Don’ts
Keep equipment clean No overloading of engine and
equipment
Operation and maintenance manuals
should be thorough as per
manufacture’s instruction
No mixing of different brands of
lubricants
Attention to lubrication, nuts and
bolts should be tight
Don’t observe economy only in cost
of maintenance
Periodic preventive maintenance
Use of only genuine spare parts
15. Safety management in construction
• A safety management system provides a systematic way to identify hazards
and control risks while maintaining assurance that these risk control are
effective
• Safety management during the construction phase covers:
Identification of workplace risk and implementation of appropriate controls
to avoid personal injury and property damage.
Monitoring of work to provide early detection and correction of unsafe
practices and conditions.
Protecting the adjacent public and private properties.
Providing safety education and incentive programs.
Complying with occupational, health, and safety rules and requirements.
16. Objectives of safety management
To help increase speed in construction
To increase the standard of living
To reduce the cost of construction
To conserve the available labour force by minimising idle time
To reduce human suffering
Safety measures should be especially taken in the following areas:
Excavation
Drilling and blasting
Hot bituminous work
Fabrication and erection
Demolition
17. Accident
Causes:
• Non-use of protective gear
• Lack of security and monitoring at work
sites
• Use of substandard material or
equipment and non-adherence to
specific guidelines
• Lack of training in safety matters
• Failure of construction equipment
• Storage of hazardous material without
permission and beyond the allowable
capacity
• Electrical shocks
• Fall of heights due to unsafe
scaffolding, ladders
Prevention measures:
• Education and training
Provisions of safe scaffolding systems
Protection and precautions in
excavation work
Safe operation of equipment
Precautions against electrical shock
Implementation of technology
• Enforcement of law
• Use of standard operation manuals
18. Classification of causes of accident in
construction industry
1. Physical causes: Related to equipment, materials, tools, uniform etc.
2. Physiological causes: Related to person: poor eye sight, poor health,
overwork, old age, intoxication etc.
3. Psychological causes: mental tension and worry, impulsiveness,
nervousness, overconfidence, carelessness etc.