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Equipment repair vs. replace calculator

Decide whether to repair a machine or replace it, on cost per year rather than sticker shock. A repair looks cheap next to a new machine, but if it only buys a year or two while the new one lasts a decade, the repair can be the expensive choice. Enter your numbers and see the yearly cost each way.

§ 01 Your numbers

Change anything. The answer updates as you type.

What the fix costs, from the quote. Include everything: parts, labor, and the diagnostic.
How many more years the machine will realistically last after this repair, before the next big one. Be honest: an old machine rarely gets one clean problem.
What a new machine costs, all in.
What you get for the old machine if you replace it now. Credited against the new price.
The working life you expect from the replacement. This is what makes a new machine cheap per year despite the price.
Repair: cost per year
$1,500
  • Repair cost, per year it buys$1,500
  • Replace cost (net of trade-in), per year$2,938
  • Repair quote$3,000
  • New machine, net of trade-in$23,500
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The repair is under about a third of a new machine's price. If it buys you real years, repairing usually wins on cost per year. Confirm the years are honest.

What this assumes, and where it could be wrong

Every one of these is a place the number could be off. They are here because you should be able to check our working, not because we are hedging.

COMPARE COST PER YEAR, NOT THE REPAIR BILL AGAINST THE NEW PRICE.
A $3,000 repair looks cheap next to a $25,000 machine, but if the repair buys two years and the new machine lasts eight, the repair costs $1,500 a year and the new one costs about $3,000 a year net of trade-in. Suddenly it is closer than it looked, and if the repair only bought one year it would lose outright. The years each choice buys are what actually decide it

Be honest about the years a repair buys. An old machine rarely has one clean problem: fix the transmission and the hydraulics are next. If you would be surprised to get two more trouble-free years, put one in, because an optimistic life estimate is what makes a bad repair look good.

The 50 percent rule is a starting point, not a law. A common trade rule of thumb says replace once a repair exceeds about half the cost of a new machine. The calculator shows the repair as a share of the new price so you can see where you sit, but the cost-per-year comparison is the honest version, because it accounts for how long each choice lasts.

A new machine can be cheaper to run, and this does not count that. Newer equipment often uses less fuel and needs less maintenance, which tilts further toward replacing. If those savings are large, add them, because this compares only the capital cost per year, not the running cost.

The defaults are ours and are a starting point. The repair quote, the prices, and the years are yours, and the answer turns most on the years the repair honestly buys.

Frequently asked questions

Should I repair or replace equipment?
Compare the cost per year, not the repair bill against the new price. Divide the repair by the years it buys, and the new machine (net of trade-in) by the years it lasts. Whichever costs less per year wins. A cheap repair that only buys a year often loses to a machine that lasts a decade, which the calculator makes clear.
What is the 50 percent rule for repairs?
A trade rule of thumb: if a repair costs more than about half the price of a new machine, replace it instead. It is a useful gut check, and the calculator shows your repair as a share of the new price. But it ignores how long each option lasts, so the cost-per-year comparison is the more honest way to decide.
When is repairing equipment the better choice?
When the repair is small relative to a new machine and it buys you real, trouble-free years, and when your cash is better kept for other things. Repair wins on cost per year for a solid machine with one genuine fault. It loses when the machine is near the end and the repair only postpones the replacement by a year.
Does a new machine's efficiency change the decision?
It can, and this calculator does not include it. Newer equipment often burns less fuel and needs less maintenance, so if those savings are large they push toward replacing beyond what the capital cost per year shows. For a machine you run heavily, add the running-cost difference before deciding.

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