Understanding total cost of ownership (TCO) over the lifetime of a machine helps you make highly informed decisions about which equipment to buy. Several factors go into calculating TCO. Some costs are fixed, such as the initial purchase price, while other costs – repair and maintenance, fuel and operators' hourly wages, for example – fluctuate.
Making the variable costs more predictable can help with budgeting and avoiding large, unplanned expenses. It also contributes to higher accuracy in estimating, bidding and determining operating expenses. One way to make costs predictable is by purchasing an extended warranty and extended periodic maintenance with fixed costs for maintenance and repairs.
“Machinery comes with a standard warranty that covers any repairs for the first 12 months,” said Felipe Cueva, Manager, Genuine Care for Komatsu. “Once the machine hits those marks, the expenses can be unpredictable and are all covered by you. Car manufacturers started offering extended warranties years ago, and equipment manufacturers have taken up the concept more recently. The advantage is that for a relatively nominal monthly charge, you have the peace of mind that when service or repairs are needed, you won’t be hit with a potentially big bill.”
Cueva noted that there have been options available for up to 10,000 hours of extended maintenance and repair coverages for some time. Some examples are Komatsu’s recently introduced Komatsu Care Plus and Komatsu Care Plus II, as well as its Advantage Coverage. Soon it will offer Komatsu Care Plus III for larger machines, including wheel loaders, rigid-frame trucks and dozers.
“What’s been missing is a program designed for those businesses such as quarries or mines that keep equipment for 30,000 hours before rebuilding it or taking it out of service,” said Cueva. “Our new Komatsu Care III is a full, comprehensive maintenance and repair program for the first life of the machine. Like the other Komatsu Care programs, it covers scheduled maintenance and repairs. Care Plus III is even more comprehensive because it includes the equipment's consumables or wear parts such as brakes, hoses, pins and bushings.”
Clearer profitability picture
Cueva added that Care Plus III’s cost is based on utilization. Customers pay a per-hour rate, and Komatsu tracks the machine’s hours through its telematics systems. Coverage extends across the country, and contracts are transferrable
“This is really the first commercialized TCO from a manufacturer,” said Cueva. “It makes your profitability clearer because there are no surprises. We encourage anyone who would like to better know their lifetime costs to contact their dealer about any of the Care Plus programs.”
