Tower Crane

Option A Option B Option C

Brand KOBELCO SUMITOMO IHI
Model 7055‐T S650‐11 CCH700
Capacity 55 T 65 T 70 T
Nos required 1 1 1
Mode of procurement rental/ loan/ cash
Normal Price (RM) 465,000 485,500 490,000
Loan price (RM) 499,875 521,913 526,750
Rental price per day (RM) 850 950 1,050
SPECIFICATIONS
Weight
Operating weight 56.7 T (Approx.) 64 T (Approx.) 65.4 T (Approx.)
Ground pressure 0.74 kg/cm² 0.74 kg/cm² 0.79 kg/cm²
Counterweight 15.2 T 19.5 T 25 T
Performance
Swing speed 4.0 rpm 3.4 rpm 3.3 rpm
Travel speed 1.49/0.9 mph 1.0/0.7 mph 1.24/0.8 mph
Rated lifting capacity 55 T 65 T 70 T
Engine
Make Hino  Hino Cummins
Model J08E‐TM H07CT QSB 6.7
Fuel tank capacity 400 liters 310 liters 240 liters
Operation cost (if not rental/5 years)
Maintenance 18,000 18,000 18,000
Operational 120,000 120,000 120,000
SUMMARY
Total Rental Cost (5 years x 12 months) (RM) 1,020,000 1,140,000 1,260,000
Total Loan Cost + operation cost (RM) 637,875 659,913 664,750
Total to be paid by Cash (Lumpsum) + operation cost (RM) 603,000 623,500 628,000
Mode of procurement LOAN LOAN LOAN
The tower crane chosen is the brand of KOBELCO model 7055-T with the capacity of 55 tones.
The mode of procurement is given by three (3) choices, which is cash, loan or rental. Rental
cost will be the highest one as the machine is completed with driver, and all of the
miscellaneous cost is included including operational cost and if the tower crane is out of
service, the provider will exchange with a new tower crane. However, the cheapest option is
of course the cash term. But, it is not advisable as the cash that needed to be settle down is
roughly around more than RM600,000, it is a very big amount. The money can be used as
capital to start the project, so the best option for having this machine is by purchasing it through
applying loan.
Even though the option for bank loan with the charge of loan interest and bank loan
modification (BLM) for the machine is pretty high which is (7.5%), it is still profitable since
the monthly payment is only around RM9000. The reason why we chose loan option is, firstly,
it gives the benefit to our side since the crane tower is a brand-new machine, so it will only
require a really low maintenance and service. Secondly, after the construction period is
completed, the machine can be sell at a good price, hence, the cost of buying the machine is
reduced and beneficial compared to rental. However, the company need to find a qualified
driver to operate this tower crane. The cost for the driver is estimated to be around RM1,300
per month, so the cost for 5 years of services will be around RM120,000. Option A is chosen
because based on the three specifications, the counterweight of option A is already enough to
cater the whole construction with the capacity of 15.2 Tones. The fuel tank capacity is the
largest compared to the three options, having with 400 liters of fuel consumption. In terms of
performance, the swing speed of tower crane of option A is highest with the value or 4.0 rpm.
This machine is made in Japan with the engine brand of Hino.
It can be concluded that based on the three choices, option A is already sufficient
enough to build this university with quantity of 1 tower crane machine. The capacity of tower
crane is enough to cater with all of the weight of the goods to be lifted up. For the mode or
procurement, loan is better than cash term because the money can be used for other purpose
throughout the project even the interest rate is 7.5%. The rental is not advisable as the
construction period is too long (taking time up to 5 years), hence purchasing it is the best option.
As mentioned earlier, the machine can be sell at good price after the construction is finished if
there is no storage location, to reduce the cost of having the tower crane machine on site.