Solving Large Replacement Problems With Budget Constraints

Karabakal, Nejat.; Bean, James C.; Lohmann, Jack R.

doi:10.1080/00137910008967554

Cited by 17 publications

(13 citation statements)

References 18 publications

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“…As noted with our fleet replacement example, reasons for simultaneously considering the replacement of assets in a group as opposed to individually are numerous. Common examples that have been studied in the literature include economies of scale in the purchase price (Jones et al, 1991;Hopp et al, 1993;Chen, 1998;Tang & Tang, 1993), demand constraints (Chand et al, 2000;Chand & McClurg, 2002;Hartman, 2000;Hartman & Lohmann, 1997;Rajagopalan, 1998), and budgeting constraints (Karabakal et al, 1994(Karabakal et al, , 2000. These characteristics or constraints, either alone or together, cause economic interdependence among the assets and the analysis of replacement alternatives must be examined as a group, resulting in a difficult, combinatorial problem.…”

Section: Introductionmentioning

confidence: 97%

Case Study: Bus Fleet Replacement

Keles

Hartman

2004

The Engineering Economist

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Parallel replacement analysis is concerned with determining minimum cost replacement schedules for a group of assets that are economically interdependent and operate in parallel. That is, keep and replace decisions are required for each asset among a group of assets over a specified horizon. The assets are economically linked through economies of scale or budgeting constraints. One application of parallel replacement analysis is fleet replacement. We recently studied the operations, including fleet replacement policies, for a city transit bus operator in Europe. Key factors in their replacement decisions included the ability to choose from multiple manufacturers, purchase price, and government regulations. We explore these and other factors, by solving a heterogeneous replacement problem with fixed costs, budgeting constraints, and demand constraints.Through extensive sensitivity analysis we analyze the impact of various parameters on decisions, in terms of the choice of replacement assets, as well as the optimal time to retain assets. Additionally, we provide motivation for future research in this application area, which is important for many cities.

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Section: Introductionmentioning

confidence: 97%

Case Study: Bus Fleet Replacement

Keles

Hartman

2004

The Engineering Economist

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“…Moreover, devising a policy for each asset in isolation could lead to an infeasible strategy as the aggregate cost is likely to violate budget and resource constraints. Hence, previous researchers have incorporated performance and resource [112] dependencies into problems in this DC. The equipment replacement problem with resource dependence is more complex in a portfolio than in a fleet because different cost and deterioration functions are associated [113], [114].…”

Section: Intervention Policymentioning

confidence: 99%

A review of asset management literature on multi-asset systems

Petchrompo

Parlikad

2019

Reliability Engineering & System Safety

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This article gives an overview of the literature on asset management for multi-unit systems with an emphasis on two multi-asset categories: fleet (a system of homogeneous assets) and portfolio (a system of heterogeneous assets). As asset systems become more complicated, researchers have employed different terms to refer to their specific problems. With an objective to facilitate readers in searching conducive studies to their interests, this paper establishes a novel classification scheme for multi-unit systems in accordance with essential features such as diversity of assets and intervention options. Moreover, discerning differences in characteristics between cross-component and cross-asset interactions, we select three types of potential multi-component dependencies (performance, stochastic, and resource) and extend their notions to be applicable to multi-asset systems. The investigation into these dependencies enables the identification of problems that could exist in real industrial settings but are yet to be determined in academia. Ultimately, we delve into modelling approaches adopted by previous researchers. This comprehensive information allows us to offer the insights into the current trends in multi-asset maintenance. We expect that the output of this review paper will not only stress research gaps on multi-asset systems, but more importantly help systematise future studies on this aspect.

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“…The first paper [16] presents a branch-and-bound algorithm, while the second [17] presents a heuristic Multiplier Adjustment Method (MAM) for solving large, realistically sized problems.…”

Section: Literature On Parallel Replacementmentioning

confidence: 99%