JOC ARCHIVES

May 31, 2010

BRYAN GOUR

A worker evaluates a excavator brought into the Langley Excavator Parts Exchange Inc.

FEATURE | Heavy Equipment

Discovering where old heavy equipment goes to die

Where do old machines go to die? The answer reads like a bumper sticker slogan: Old Machines Don’t Die – They Just Depart.

“There are really a number of exit strategies for old equipment,” said Lucas Fennell, evaluator for Finning Tractor & Equipment Company, located in the Surrey branch office.

Fennell, who evaluates used machines based on age and condition, determines the lifecycle of equipment brought in as a trade or consignment item, but all the paths downstream eventually involve some kind of recycling.

The exit paths, said Fennell, are essentially three feed streams; the used market to another contractor or job user, spinning older equipment out to a farm or acreage where its only needed for a few hours of work a year, or, the machine is broken down into parts or reconditioned parts and fed into the used parts market.

Finning, one of the largest new and used equipment dealers in North America, has five used equipment locations in B.C. and Alberta alone: Surrey, Prince George, Grande Prairie, Edmonton and Calgary.

An Edmonton office handles usable or refurbished parts for exhausted equipment.

“The waste metal or unusable parts goes to scrap metal,” said Fennell.

Used equipment with remaining life often ends up in auctions such as Ritchie Bros. Auctioneers, the largest such company in North America.

“We have been called the world’s largest recycler,” said Vicki Cunningham, in marketing at Ritchie Bros., as equipment often cycles through a number of times as operating hours increase and the buyer varies from contractor, to farmer and finally parts dealer.

BRYAN GOUR

Excavator parts in all shapes and sizes can be found at the Langley B.C. facility.

A regular at Ritchie Bros. auctions is Bryan Gour of Langley Excavator Parts Exchange Inc., now located in a 21,000-square-foot, new, purpose-built concrete facility in Surrey.

The location is designed to take apart machines and spin off parts into the market.

“Our niche is fairly focused,” said Gour, who sticks to a market he knows. He deals in Hitachi and John Deere hydraulic excavators (which share components) manufactured in 2003, 2004, and 2005.

He takes out 20-30 different components. Earlier models are welcomed, but value is less, while pricier later models are also cannibalized, but are usually related to an insurance claim like a fire.

The end-users vary. Gour sells some retail, but his largest market is wholesaling to equipment dealers or parts dealers globally.

“I’m always surprised how far some of the stuff goes,” he said.

He has clients as far away as Alaska, Florida and even Russia. He sends out about 36 machines a year.

“The recession has been good for us,” he said, adding that the 2004-2008 boom years created a pool of unused excavators now in auction.

Those contractors using existing equipment are looking to extend machine life by changing to lower-cost replacement parts on the used market. It’s not unusual for him to buy a machine at auction that has one of his refurbished or cannibalized parts.

“We are not only buying a machine to take apart, but we are buying back our own parts,” he said. Brikers is also another recycler of machines into parts, searching out machines from a number of sources, said general manager James Whone.

“You would be amazed where used equipment comes from – there’s equipment everywhere,” he said.

Brikers is also hooked into a network of dealers and can source special used parts and respond to specific queries – again in a market that is global.

The bones of machines cannibalized for parts go to scrap yards for recycling.

“We deal with a lot of construction people,” said Ron Ramsey, operation manager at ABC Recycling Ltd. and the scrap ranges from forms from Golden Ears Bridge through to salvage scrap of old machines.

It’s either shipped to a smelter or offshore to areas such as China. However, it’s not always a quick death for machines. Ramsey said he met his own excavator used at his scrap yard 25 years ago recently on a farm – and it was still operating. That’s not uncommon, as there’s a reason for most equipment’s long-life.

“Steel is banned from landfills,” said Harbinder Dhillon, general manager of Richmond Steel Recycling, an intake facility for Nucor Steel’s refinery in Seattle, which is part of Sims Metal Management.

Richmond Steel gets equipment such as yarders, skidders, ship loader conveyors, and even port cranes, although vehicles and household appliances are most common.

It’s all sent to Nucor and comes back to Lower Mainland projects such as bridges in the form of rebar.

Today’s consumers could be walking or driving over old construction equipment.

“Although it’s more likely your old car or appliance, based on volume,” said Dhillon.

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