Aging Aggregate Equipment
Aggregate Equipment
As operators
defer capital
expenditures, iron
continues to age,
but our exclusive
survey shows
that operators are
beginning to expand
capital expenditures.
By Therese Dunphy,
Editor-in-Chief
18
R
epair, rebuild, or replace? It’s the conundrum facing many operators throughout
the aggregate industry. Over the last
six years, the U.S. Geological Survey
reports that estimated production levels of crushed
stone have dropped by more than 35 percent, while
sand and gravel production has decreased by slightly more than 40 percent. Lower production levels
have eased hours of operation on equipment, and
many operators — faced with uncertain economic
prospects — have deferred capital expenditure
investments. The result is an increase in the age of
equipment operating throughout much of the aggregate industry.
In an exclusive survey, Aggregates Manager asked
operators to tell us about their current mobile and
stationary equipment, as well as their capital expenditure plans for the next 12 months (see Chart 1
for equipment replacement values of respondents’
existing fleets). A total of 110 operators completed
our questionnaire. It should be noted that responses
were given prior to the passage of the surface trans-
AGGREGATES MANAGER August 2012
portation reauthorization legislation, Moving Ahead
for Progress in the 21st Century (MAP-21).
The big picture
According to survey respondents, more than one
in four (25.4 percent) plan to increase their budget for capital expenditures over the next year. Of
those, 64.3 percent anticipate an increase of 1 to
20 percent, with another 28.6 expecting a 21- to
40-percent jump in budgets. Conversely, 13.6 percent of respondents project a decrease in capital
expenditure budgets, with most forecasting a 1- to
20-percent drop.
Not surprisingly, equipment maintenance is
the budget category projected to be most likely to
experience an increase in spending. A total of 36.6
percent of respondents expect to spend more over
the next year to maintain their equipment, while
just 2.2 percent predict their maintenance spending will decrease.
Anecdotally as well as statistically, maintenance,
maintenance, maintenance is the mantra of survey