Used equipment can be an excellent investment if you choose wisely.
Just as a new car loses market value the minute it’s driven off the lot, construction equipment quickly depreciates. That’s one of the main reasons used construction equipment can be a smart purchase option for companies trying to preserve capital and reduce spending. Another reason is the difference in price. Used equipment could cost as little as 50 cents on the dollar compared to new, depending on its age.
Used construction equipment can be a bargain, if it’s been well maintained. The used equipment United Rentals sells, for example, “still has an extensive useful life left for the end user,” said Stephen Cook, Senior Manager, Used Equipment Sales at United Rentals.
But not all used construction equipment is created equal. Before you haul a piece of equipment off the “lot” or sign on the dotted line, make sure you’re getting a good deal.
Buy from a reputable dealer
Just as there are bad used car investments, there are bad used construction equipment investments. To protect yourself against buying a lemon, start by working with a reputable dealer or rental equipment company. You’re more likely to get a well-maintained unit made by a reliable manufacturer.
United Rentals keeps its equipment rental-ready. And, as a rental equipment provider with one of the youngest fleets in the industry, it sells its equipment when it still has plenty of life left. “We don’t run our equipment into the ground,” said Cook.
Check the maintenance history
The downside of buying used is the increased cost of maintaining an older machine (though oftentimes the math still comes out in favor of buying used). A used machine that has been carefully maintained will likely perform more reliably and have fewer service issues than one that hasn’t.
Ask for proof that a machine has received regularly scheduled preventive maintenance, including oil changes, air filter changes, fluid changes and other manufacturer-recommended service. You might want to also ask for recent repair records in order to understand what systems, if any, have had recent service. Major repairs to a newer machine could indicate a lack of preventive maintenance.
Conduct an inspection
Look for obvious signs of age or damage, such as rust, hairline cracks or repair welds. For extra assurance as to a machine’s condition, bring a service technician or mechanic to perform some basic inspections.
Check the oil filter for a date written on it, which should be recent. Examine the air filter. “If it’s dirty, you may be looking at engine wear or engine heat,” said Cook, though a dusty environment could also be responsible. Check the engine fluids to see if they’re dirty, low, or contaminated — for instance, the engine oil has water in it, or the coolant has oil in it.
You might even pull an oil sample and run it to determine if the oil contains metal components (it shouldn’t).
Check hydraulic hoses and look for worn hydraulic cylinders or leaks. Look for visible oil leaks. Examine the tracks or tires if the machine has them. Uneven wear, especially on track components, is a red flag.
Weigh use hours more than age
An older machine may or may not have more service hours left on it than a newer machine. Check the hour meter and compare the annual usage to the average annual usage for that type of equipment. Keep in mind, however, that even heavy use may not mean the machine is done for, especially if it’s been well maintained. Take an excavator, for example. “A large excavator is mainly going be stationary — turning, loading and digging. It may show a lot of hours but not a lot of wear on the undercarriage components,” said Cook.
Also consider the nature of the operating environment the machine endured, including the work it was doing and the weather conditions it was subjected to.
Try before you buy
Ask if you can test the equipment before purchasing. Make sure the equipment starts and stops as expected and that the engine, if there is one, runs smoothly and doesn’t produce any unusual exhaust. Put all the controls through their paces.
When purchasing a piece of used equipment from United Rentals, you may be able to demo it on a jobsite for a brief period.
In the end, the key to making a smart used equipment purchase is to know what you’re getting. Buying well-maintained equipment from a reputable company can help ensure you’re getting good value for your money.
After your purchase, servicing the equipment per the manufacturer’s recommendations will protect the value of your investment. If you’re buying used equipment and don’t have an experienced mechanic who can service it or don’t want to invest in running an in-house service operation, United Rentals offers a customer-owned equipment service plan that includes preventive maintenance, inspections and repairs by expert technicians.
Check out the used equipment for sale from United Rentals at used.unitedrentals.com.
Marianne Wait is an editor and writer who creates content for Fortune 500 brands.