When considering vehicle replacement, what cost threshold must be exceeded to consider replacement?

• A. 50% of new value
• B. 75% of new value
• C. 100% of new value
• D. 125% of new value

Answer: (B)

When determining whether to replace a vehicle, the threshold of exceeding 75% of the new value is a common guideline used in asset management and fleet operations. This percentage helps ensure cost-effectiveness in maintaining vehicular assets. When repair costs reach or exceed this threshold, it often indicates that the vehicle's operating efficiency is compromised, and ongoing maintenance can become financially unfeasible compared to investing in a new vehicle.

The rationale for choosing 75% is that it balances the financial viability of repairs with the potential benefits of new technology, safety features, and reduced maintenance costs associated with newer models. Vehicles that are nearing this operational cost threshold may exhibit increased downtime, higher repair frequency, and diminished reliability, which can hinder their performance as emergency response units in an airport setting.

As for the thresholds that are lower or higher than this benchmark, options at 50% may lead to premature replacement without fully utilizing the vehicle's lifespan, while thresholds of 100% or 125% can lead to excessive and unnecessary expenditures on repairs when a more prudent approach would be to invest in a new or refurbished vehicle. This balance is crucial for maintaining an efficient and effective fleet, especially in environments where every minute can impact safety and operational readiness.