Equipment downtime is often called the hidden cost of fleet management. If downtime is not continually monitored and recorded, the costs can become significant.
Fleet managers must be aware of how machine downtime can affect their productivity and, therefore, the importance of correct monitoring and recording.
The 2012 IPWEA Plant & Vehicle Management Manual contains guidelines and best-practice procedures to monitor downtime.
By following these guidelines, the fleet manager will be able to establish an accurate cost of downtime and then plan proper maintenance schedules, operator training and the optimum replacement point.
There are two major components of downtime costs: the hire of replacement machines and the fixed costs related to the loss of an operational machine on a specific task.
The hire of a replacement machine also incorporates the cost of holding additional machines such as a spare truck in a waste collection fleet in order to compensate for the mechanical downtime on other machines. Furthermore, dry hire of an externally supplied machine may involve on-site and off-site charges and these too need to be incorporated into the hire charges.
The fixed costs related to the loss of an operational machine are the costs incurred irrespective of ownership. These include licenses, insurance, finance costs and depreciation.
In addition, the fleet manager also must establish the costs of operator’s downtime if there is a net loss of productivity. Rearranging tasks for crews and other associated plant/vehicles due to plant downtime also costs management time and employees travel time to and from equipment breakdowns.
All these items need to be assessed and allocated as a fixed cost associated with downtime for every item of plant and fleet.
For more information on the best practice for monitoring downtime and calculating the most accurate information, obtain your copy of the IPWEA Plant & Vehicle Management Manual at
www.ipwea.org.au/FleetManualv3