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When buying an electric motor, most businesses look at a single number: the purchase price. Yet the real cost of a motor arises not at the moment of purchase but over its years-long operating life. Within the total money a continuously running industrial motor spends over its life, the share of the purchase price is surprisingly small; often only a small percentage of the total. The large remaining part is energy consumption, followed by maintenance and spare parts. In this article we address this ratio logic; we explain the shares of purchase price, energy, maintenance and operating costs within the lifecycle total cost using a percentage approach. We do not give any fixed currency figure here; the aim is to let you see the ratio and the share.
What Is Lifecycle Cost (TCO)?
Lifecycle cost, or total cost of ownership (TCO), covers not only the purchase price of a motor but all the expenses it causes throughout its operating life. These expenses fall into three main headings: purchase (purchase price), energy (electricity consumption) and maintenance/operating (lubrication, bearing replacement, failures, downtime). In a continuously running industrial motor, the shares of these three items are very different and the opposite of intuitive expectation.
The important thing is to think of these three items on the same time scale, that is, over the entire life of the motor. We covered the TCO comparison by efficiency class in our IE5, IE4 and IE3 TCO comparison article, and the TCO logic in a high-efficiency motor in our TCO in high-efficiency motors article.
The Small Share of Purchase Price in the Total
When looking at the lifecycle cost of a continuously running motor, the most surprising finding is that the purchase price makes up only a small percentage of the total. In a motor running in shifts and turning year-round, this share is usually very low; the great majority of the total cost comes from energy. So the money paid at the moment of purchase is small compared with the total money the motor will spend over its life.
This does not mean the purchase price is unimportant; but it shows it should not be the sole decision criterion. Choosing a motor that is a few units cheaper but less efficient comes back as a much larger energy bill over the life. We covered the effect of the difference between nameplate efficiency and field efficiency on real savings in our nameplate vs field efficiency difference article. We examined the items making up the motor price in our factors affecting electric motor prices article.
The Large Share of Energy: Why Is Efficiency Decisive?
Since the great majority of the total cost is made up of energy, the motor's efficiency directly determines the lifecycle cost. Efficiency shows how much of the electricity entering the motor is converted into useful mechanical power; the rest is lost as heat. Even if two motors do the same job, the less efficient one draws more electricity over its life and increases the bill.
Efficiency classes (IE3, IE4, IE5) define exactly this difference. We covered what moving to a higher efficiency class gains in our replacing the old motor with IE4 article, and the investment decision between IE3 and IE4 in our IE3 vs IE4 electric motor investment article. The motor running at the right load also affects efficiency; an oversized motor loses efficiency at part load. We examined this in our motor load ratio and correct sizing article.
The Hidden Cost of an Inefficient Motor
A cheap but inefficient motor looks like a saving at the moment of purchase; however, this saving melts away in the first years through the energy difference and continues to generate extra cost every year afterwards. This is a "hidden cost" that does not appear clearly on the bill but is paid every month. We covered the effect of the efficiency difference on annual gain at continuous load in our energy saving at continuous load in pumps, fans and compressors article. We explained savings with a VFD in pumps and fans in our VFD pump-fan savings article.
The Share of Maintenance and Spare Parts
The item that comes after energy is maintenance and spare parts. Lubrication, bearing replacement, periodic inspection, rewinding when needed and failure repair fall under this heading. Although the maintenance share is small compared with energy, it cannot be neglected, because poorly managed maintenance leads to unexpected failures and downtime. A line stopping can be far more expensive than the cost of the part.
Well-planned periodic maintenance both extends motor life and lowers the total cost. We covered the maintenance schedule in our maintenance and periodic check schedule article, and bearing greasing and lubrication in our bearing greasing and lubrication article. We explained understanding the problem early from fault symptoms in our fault symptoms diagnosis guide article.
Rewind or Buy New?
Beyond a certain point, the maintenance cost ceases to be economical. Rewinding an old and inefficient motor repeatedly leads to both efficiency loss at each rewind and recurring expense. We covered this decision in our rewind or buy new article, and the efficiency loss after rewinding in our rewinding an IE3 motor article. Especially at low powers, a new and efficient motor is usually more sensible than repeated maintenance expenses.
Downtime and Production Loss: The Biggest Risk Not Seen on the Bill
When evaluating the maintenance cost, the item most businesses overlook is the cost of unexpected downtime. When a motor fails, not only the part or repair cost of the motor but also the production lost because the line it drives stops comes into play. In a continuously running plant, a few hours of unplanned downtime can cost far more than the motor itself. That is why choosing a reliable, high-quality and long-life motor is in fact a downtime insurance.
This logic also justifies keeping spares for motors at critical points. Having a spare in stock for the most-used and most-critical motors quickly brings the line back up at the moment of failure. We covered critical spare motor planning in our critical spare motor list and stock planning article, and reducing failure and downtime cost in our motor failure and downtime cost article. A cheap but unreliable motor returns its apparent saving many times over at the first major downtime.
Choosing the Efficiency Class According to Operating Time
The share of energy in the lifecycle cost depends on how much the motor runs. While the energy difference remains small in a motor running a few hours a day, the energy difference dominates the total cost in a motor running in shifts or continuously. That is why the efficiency class decision must be made together with the operating hours: moving to IE4 or IE5 pays back quickly in heavily running motors; IE3 may be sufficient in lightly running motors.
We covered this decision according to power, operating hours and payback in our IE4 vs staying with IE3 article, and whether IE5 makes sense at low power in our IE5 at low power below 7.5 kW article. The right efficiency class directly reduces energy, the largest item in the lifecycle cost.
Seeing the Ratio: Percentage Logic for the Right Decision
In summary: in the lifecycle cost of a continuously running motor, the purchase price is a small percentage, energy is the great majority, and maintenance is a measured but critical share. Seeing this ratio completely changes the purchasing decision. Instead of looking only at the nameplate price, one must consider how much energy the motor will draw over the years and how much maintenance it will require.
The correct approach is to treat the motor not as an expense item but as an investment that will run for years. We covered which items to look at when reading proformas and quotes in our proforma and quote reading article, and why same-kW motors are priced differently in our brand, origin and warranty difference in motor price article. We explained carrying out an efficiency audit and a motor inventory across the plant in our energy efficiency audit and motor inventory article.
Frequently Asked Questions
What is the share of the purchase price in a motor's lifecycle cost?
In a continuously running industrial motor, the purchase price makes up only a small percentage of the lifecycle total cost. The great majority of the total comes from energy consumption, followed by maintenance and spare parts. Therefore, making the purchasing decision based only on the purchase price is misleading; the energy the motor will spend over its life must also be taken into account.
What is the hidden cost of a cheap but inefficient motor?
A cheap but inefficient motor looks like a saving at purchase, but because of its lower efficiency it draws more electricity over its life. This extra consumption soon exceeds the difference at purchase in the first years and continues to generate extra cost every year afterwards. This difference, which does not appear clearly on the bill, is a hidden item that increases the motor's real cost.
How does lowering maintenance cost affect the total cost?
Well-planned periodic maintenance lowers the total cost by preventing unexpected failures and costly downtime. Although the maintenance share is small compared with energy, neglected maintenance can lead to major failures and production loss. Regular lubrication, alignment and inspection extend motor life and reduce lifecycle cost.
Get a Quote
To lower the lifecycle cost of the motors in your plant, let us select together motors in the right efficiency class, at the right power and with long life. We evaluate the energy and maintenance burden of your existing motors and recommend suitable replacements and efficient alternatives. For a fast quote call our line at +90 (532) 345 49 86 or reach us through our contact page. You can review our full product range from our home page and efficient motor options from our IE3 motors category.
Lifecycle Cost Checklist
- When deciding, look not only at the purchase price but at the lifecycle total cost (TCO).
- Derive the motor's annual operating hours and power, and put the energy share first.
- Choose the right efficiency class (IE3/IE4/IE5) according to the operating time.
- Size the motor to its load; an oversized motor loses efficiency at part load.
- Create a periodic maintenance schedule; do not neglect lubrication and alignment.
- Evaluate the option of a new and efficient motor instead of repeated rewinding.
- Create a motor inventory across the plant and prioritize inefficient motors.
- Read the quote items and warranty coverage from a lifecycle cost perspective.
