Estimation of tractor repair and maintenance costs

Abstract

Estimates of tractor repair and maintenance costs are important for farm machinery replacement decisions and for general farm budgeting. The most widely UK used data on this topic are now over 30 years old. This paper reports on how records from a Norfolk farm were used to derive a repair cost function which relates tractor repair cost as a percentage of initial purchase price to cumulative hours of use. There was much variation in repair costs within and between tractors. The derived function showed that repair costs per hour tend to increase with hours of use. This is an important difference from existing UK estimates. Extrapolation of the derived function to a nominal wear out life of 10 000 hours gave repair costs equivalent to 80% of initial price. Data limitations in later tractor life suggest this may underestimate true cost. The study showed that hours of use themselves could account for no more than 16% of the observed variation in repair costs. The skill of the operator, working conditions, and maintenance standards are recognized as important determinants of machinery repair cost, many aspects of which lie within the farmer's control. These variables need to be included in future studies of machinery costs.