Grading and Excavation Contractor | Behind The Boom In Remanufacturing

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Photo: Caterpillar

By Daniel C. Brown

Last spring, Trumbull Corp. was using articulated dump trucks to haul dirt for the reconstruction of Interstate 79 in Pittsburgh, PA. It was a high-production project. Suddenly, for an unknown reason, an engine failed on one of the 40-ton trucks, which had slightly more than 4,000 hours on it, says Bob Decker, Trumbull’s equipment manager.

Photo: John Deere

Inspection ensures components meet new-machine specs.

“Rudd Equipment, the dealer, had a remanufactured engine available. We told them to go ahead, and the truck was only down for two days,” says Decker. “To rebuild that engine would have taken from seven to 14 days, so that reman engine got us going much faster, and saved the $3,000-per-day loss of production from that one truck. I’ll put a reman engine in anything.”

Ron Hutchinson has a similar story. “Two summers ago, we lost an engine in a wheel loader working at an asphalt plant in northern Kentucky,” recalls Hutchinson, the construction equipment manager for Barrett Paving Materials Inc. “The engine had overheated and failed, and we sent the whole loader to the dealer. It took seven days to put a remanufactured engine in it.

“We had to rent another loader to fill in for the one that broke down, but putting in that reman engine reduced the impact of the rental time, compared to rebuilding the old engine,” says Hutchinson. “It would have taken 14 to 20 days to rebuild that engine.”

Hutchinson and Decker are not alone. Across this country, contractors in large numbers have discovered savings in downtime costs by installing a reman unit. Virtually all engine manufacturers keep an inventory of these units—and some can ship an engine the same day they get an order.

Photo: John Deere

A ready-to-go remanufactured engine

“In a perfect world, our engine arrives just after they take the old one out,” says Bradley Fife, sales and marketing manager for ReGen Technologies, a John Deere joint venture company that remanufactures the company’s engines. “Typically we have an engine on the shelf, or one in the process of remanufacturing. At the slowest, we send an engine out the second day after an order.” Based in Springfield, MO, ReGen remanufactures engines, connecting rods, cylinder heads, fuel injection nozzles, fuel pumps, oil and water pumps, and turbochargers.

Fast-growing Business
Remanufacturing is growing by leaps and bounds. Cat Reman Services, one of the world’s largest remanufacturers, has seen its business double in size and scope over the past five years—and expects it to double again in the next five, says John Butte, commercial manager for the company.

Through last May, Fife reports that reman business at ReGen Technologies jumped by 40% over the prior fiscal year. What’s more, ReGen sales climbed by 30% in 2005 over 2004. The reasons: Customers tell Fife their equipment is very busy—even over-utilized—and that it’s difficult to find good rental units. “Acceptance of the reman option has grown,” says Fife.

Photo: Phoenix

Going reman gets machines back to work fast.

At Phoenix Reman Group, a John Deere subsidiary that remanufactures drive train and hydraulic components, business is growing at the rate of 15% to 20% a year, says Don Flatau, the group’s general manager. For one thing, reman components cost less. They run about 65% to 70% of the cost of new components.

And Flatau echoed what a number of contractors told Grading & Excavation Contractor: Reman engines and components simply offer a quicker way to get a machine up and running after a breakdown. “If a transmission fails in the field and the customer or dealer repairs it, they have to pull the transmission, split it open, order parts, make the repair, and hope they fixed the right thing,” says Flatau. “With our remanufactured transmission, they order one part number, built to new machine specifications, and it carries a new component warranty—generally a 12-month, 1,500-hour warranty. So you can imagine how much faster it is to get a customer up and running.”

Mack Trucks remanufactures approximately 4,000 to 5,000 engines every year, says Dave McKenna, powertrain sales and marketing manager. “It’s a growth business for three reasons,” says McKenna. “Trucks are lasting longer, and reman engines extend their life; two, people don’t want to rebuild their own engines because they’re getting too complex; and three, it’s quicker. You can remove and replace an engine in two days. We must be doing something right, because the business continues to grow every year.”

Caterpillar’s Butte agrees that product complexity is increasing. The heavy-equipment industry is currently suffering a shortage of skilled technicians, Butte says, and remanufactured products offer a reliable solution for those who would traditionally repair engines or components but lack the skilled resources to do so. “Cat Reman refers to it as ‘technician in a box,’ or buying labor off the shelf,” says Butte.

Photo: Caterpillar

Remanufactured piston crowns

Photo: Phoenix

Fuel diagnostic testing reduces the risk of failure

Photo: Phoenix

Disassembly and reassembly by a licensed tech

Plus, remanufacturing offers contractors a way to get the latest technology in their components. Updates might include better bearings, new gasket material, the latest camshaft design, new seals, and more. “We are continually improving the product on the new side, and that carries over into our reman program,” says Mack’s McKenna.

Thorough Process
At a high-quality remanufacturing operation, components are completely taken apart, cleaned to the bare metal, and inspected to make sure they meet new machine specifications. “If a block does not meet specifications in certain dimensions, it will not be used,” says ReGen’s Fife.

ReGen’s inspection includes a Magna-glow process to detect hairline cracks. Parts are coated with a phosphorus solution, electrified, and examined under black light. Any hairline cracks will show up. Some of them can be repaired, and some cannot, Fife says.

Components are machined in the necessary areas, re-assembled, and tested for horsepower on a dynamometer. Remanufactured Deere engines and components typically get a one-year warranty—the same as a new machine, Fife says.

Cat Reman uses state-of-the-art salvage technologies such as wire arc spray, laser cladding, and a proprietary, patented welding process. Engines and engine components are remanufactured using only genuine Caterpillar parts, many of them new, says Butte. The engines produced at Cat Reman facilities are assembled on production lines that mirror the company’s new engine manufacturing facilities. Each engine is assembled using a combination of recycled and new engine components. Engines are upgraded to include critical design improvements, so they may even outperform the original, Butte says. Cat Reman warranties are the same as new equipment—typically 12 months for mobile industrial units.

Original equipment manufacturers (OEMs) are not the only firms to offer reman products. Independent shops, such as Hoss Parts in Dallas, also rebuild engines and components. Dan Smith, Hoss’ parts branch manager, says business is up because OEMs may not have reman engines in stock and because his price is lower than an OEM.

Common engines that Hoss rebuilds are the Caterpillar 3408, the 3412, and the 3508. The shop deals with customers worldwide. Every year Hoss remanufactures 50 to 80 Caterpillar engines and about 20 Cummins engines. “We’ve sent engines to Singapore, Honduras, Mexico—we’ll sell to anybody,” says Smith. For example, Hoss recently sent four rebuilt Cat 3412 engines to a gold mine in Chile.

It takes three weeks, at most, to rebuild a Cat 3412 engine, Smith says. “We buy a lot of parts from Caterpillar, but our job is to save customers money,” he notes. “One of our selling points is that our crankshafts meet like-new specs. You can cut 25/1,000 inch off a crankshaft, but sometimes a crankshaft is not re-usable.”

Hoss tests rebuilt engines on a dynamometer, often one at a Caterpillar dealer. Engines are tested for cold horsepower, hot horsepower, and full-bore horsepower after the engine has preheated. Like an OEM, Hoss takes old engine cores in, gives customers a credit for them, and offers remanufactured engines for sale.

Caterpillar’s definition of remanufacturing is the “harvesting” of engines and components, says Butte. All remanufactured components lose their identity once they enter the reman cycle. Reman components receive a new part number and engines receive new part numbers and serial numbers. Cat Reman and other OEMs create new product from a combination of new and used materials. With more than 2 million components remanufactured annually, Cat Reman not only lowers customers’ owning and operating costs but also diverts 100 million pounds of iron from landfills worldwide.

Fix Before Failure
At Barrett Paving Materials, Hutchinson believes strongly in annual equipment inspections—by the OEM dealers—and in “fix-before-failure.” That way, he says, you can schedule your downtime. Most dealers have guidelines about engine life cycles, or the number of hours an engine can run until it needs major service. “The vendors are the professionals,” says Hutchinson. “They can tell you if an engine has 8,000 or 10,000 hours of life, and what the difference is between running with an experienced operator or a novice operator.”

Some engines only need an upper-end overhaul or a lower-end overhaul. A lower-end overhaul is the replacement of connecting rods and main bearings; an upper-end overhaul calls for valve grinding and probably new valve guides. If you catch an engine before it fails, Hutchinson notes, the technician can reuse more parts.

All-Mack Powertrains
A few years ago, K-Five Construction Corp. bought a reman engine for a Mack truck that had about 8,400 hours on it, says Dave Gorski, shop administrator for the Lemont, IL, contractor. Typically the company expects to get 12,000 to 14,000 hours from Mack trucks.

Photo: Caterpillar

Cylinder pack assembly at a Caterpillar facility

“We needed to get 5,000 to 6,000 more hours from that truck,” says Gorski. “So we bought a remanufactured engine. At one time we spec’d trucks from another manufacturer that mixed components—an engine from one company and a transmission from another. We started losing transmissions like crazy. So now all we spec is Mack trucks, because the entire powertrain comes from Mack.”

Does he use other remanufactured components? “Yes, we have a pump rebuilder here that we deal with, and they do a good job,” says Gorski. “We use Sunsource, out of Addison, Illinois. Whether we use a rebuilt pump or not depends on the nature of the repair and on availability. If a pump fails that’s not readily available, we turn the old one over to Sunsource for a rebuild.”

If Gorski needs a part immediately to repair a vital machine, he says K-Five has even sought out replacement parts from a competitor who has the same machine. “We have had failures in the middle of a concrete pour,” he says. “Maybe the rebuilder’s time to fix the part is a week and a half. So you do what you have to do.”

Cat With Nine Lives?
Caterpillar says all earthmoving machines are good candidates for reman engines. “Cat machines are designed with reusability in mind, and Reman engines and components are a great way to take advantage of the multiple lives built into a machine,” says Butte. “Other good candidates include machines needing emissions retrofits. An emission retrofit is the adapting of emission reduction technologies to existing or in-use diesel-powered equipment.”

Butte says some of the more popular Caterpillar engines for remanufacturing include engine models 3054, 3116, 3208, 3408, and 3412 for backhoe loaders, track-type tractors, excavators, wheel loaders, off-highway trucks, scrapers, and motor graders. Caterpillar provides reman products from locations in Corinth, MS; Booneville, MS; Summerville, SC; Nuevo Laredo, Mexico; Shrewsbury, England; and Shanghai, China. Nearly all plants are certified by ISO9001 and ISO14001.

Clearly the main advantage of a reman engine is that it can save a contractor’s time—both in downtime and also in an in-house mechanic’s time. “One of the advantages of reman engines is that you don’t tie up your mechanic for 40 hours or more to rebuild your own engine,” says Dave Markey, vice president of equipment services for American Infrastructure, a heavy/highway contractor. “You’re going to pay a premium for a vendor to invest in an engine and have it sit on the shelf for a while, but you’ve got to go where the greatest gain is. You may be able to use your mechanic’s time more effectively than in rebuilding an engine.”

Daniel C. Brown is the owner of TechniComm, a communications business based in Des Plaines, IL.

GEC - September/October 2006

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