Equipment Replace vs Repair Calculator
Work out whether it is cheaper to repair and keep a piece of equipment or replace it. Enter the numbers for each option and the calculator compares them on an equivalent annual cost basis, shows the 50% rule of thumb, and gives you a clear recommendation you can download and share.
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Why equivalent annual cost beats the repair bill
The instinct when an asset breaks down is to compare the repair quote against the price of a new machine. That comparison is misleading because the two options rarely last the same length of time. A repair might buy four more years while a new asset runs for eight, so a raw dollar comparison stacks a four-year cost against an eight-year cost. Equivalent annual cost fixes this by converting each option to a single yearly figure that already accounts for how long the option lasts.
The calculation also captures the money you tie up by keeping an asset. If you keep and repair, you give up the salvage value you could have realised by selling the old machine today, and you only recover a smaller salvage figure at the end of its remaining life. If you replace, that same salvage value becomes a trade-in that offsets the purchase price. Once running costs are added to the annualised capital, the equivalent annual cost tells you the true yearly cost of each path.
The 50% rule, downtime and reliability
The 50% rule of thumb says replace when a repair costs more than half the price of a new asset. It is a handy first check, and this calculator shows it as a secondary signal, but it can mislead on its own because it ignores running costs, remaining life and salvage value. A repair that comes in under the 50% threshold can still be the wrong call when the ageing asset burns fuel, needs constant attention, or sits idle waiting on parts. That is why the equivalent annual cost is the primary decision here and the two can point in different directions.
Downtime is the cost most often left out. Every hour an asset is off the job can stall work, idle a crew, or force a short-notice hire. Fold a realistic downtime estimate into the annual running cost of whichever option suffers it, usually the older asset you are thinking of keeping. Reliability matters for the same reason: a machine that keeps failing carries hidden cost that a repair invoice never shows. MapTrack's maintenance tracking records repair history and downtime per asset so these numbers come from your own data, not a guess.
How asset tracking sharpens the decision over time
A replace or repair decision is only as good as the numbers you feed it. Most businesses estimate running costs and repair history from memory, which biases the answer toward whichever option feels right that week. When every repair, service and hour of downtime is logged against the asset, the annual running cost and salvage assumptions become facts you can defend in a capital request.
MapTrack keeps a live register with the repair history, downtime and running cost of every asset over its whole life, so the same decision gets easier and more accurate each time you make it. Pull the figures on demand with built-in reporting, then sanity-check the full cost of ownership with the total cost of ownership calculator and the depreciation calculator.
Frequently asked questions
Should I repair or replace my equipment?
Repair when the asset has useful life left and the ongoing running costs stay reasonable. Replace when repairs are frequent, running costs are climbing, or a new asset is materially cheaper to own over its life. The most reliable way to decide is to compare the equivalent annual cost of each option rather than looking at the repair bill alone, because a cheap repair on an unreliable asset can still cost more per year than a new machine.
What is equivalent annual cost (EAC)?
Equivalent annual cost spreads the one-off capital difference of an option over its remaining life and adds the annual running cost, giving a single yearly figure. Because it converts everything to a per-year number, you can compare two options with different lifespans on a like-for-like basis. For repair, the capital element is the repair cost plus the salvage you give up by not selling now, less any salvage recovered later, divided by the remaining life. For replacement, it is the purchase price less the trade-in and less the future salvage, divided by the new asset life.
What is the 50% rule for equipment replacement?
The 50% rule is a quick rule of thumb: if a repair costs more than half the price of a comparable new asset, it leans toward replacement. It is useful as a fast sanity check, but it ignores running costs, remaining life and salvage value. This calculator shows the 50% rule as a secondary signal alongside the equivalent annual cost, which is the primary decision and can point the other way when running costs or salvage values are significant.
When should I replace equipment even if the repair is cheap?
Replace a cheap-to-repair asset when it has high annual running costs, when it keeps breaking down and causing downtime, when it is near the end of its useful life, or when a new asset is far cheaper to run. In these cases the equivalent annual cost of keeping the old asset can be higher than replacing it, even though the immediate repair bill looks small. Reliability and downtime often tip a marginal decision toward replacement.
How does downtime affect the repair or replace decision?
Downtime is a real cost that rarely appears on a repair invoice. Every hour an asset is out of action can stall a job, idle a crew, or force a hire replacement. Fold an estimate of downtime into the annual running cost for the option that suffers it, usually the ageing asset you are considering keeping. An asset that is reliable but slightly more expensive to run can still be the better decision once downtime is counted.
Can I download the replace vs repair comparison as a PDF?
Yes. Enter your numbers, then use the download button to generate a branded PDF with the recommendation, both equivalent annual cost figures, the full input breakdown, and the 50% rule check. Share it with your finance team or asset manager, or attach it to a capital request.
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Total cost of ownership calculator · Equipment depreciation calculator · Downtime cost calculator