Should you buy a new or used excavator in 2025?

In the world of construction machinery, the excavator remains the undisputed king for turning dirt into dollars. But, as you’ll know if you’re reading this, they aren’t cheap.

Whether you’re in the market for a go-anywhere compact excavator or a 30-tonne worksite warrior, the question of whether to buy a new or used machine has likely crossed your mind. Both options offer pros and cons.

If you’re an operator, an excavator will be among your largest capital investments and you’ll need to shift a lot of dirt to cover the upfront cost of a brand-new machine. But while it may save you money up front, there are additional costs associated with used machines that require factoring into your budget.

The right choice will come down to a variety of factors, ranging from budget to long-term expectations, while also considering operating expenses. Then there’s the relentless demand for productivity, which gives new technology-rich machines the upper hand.

Here are five key considerations operators should consider before deciding on whether to buy a new or used excavator.

While the initial purchase price of a used excavator is tempting, it can become a financial liability if you don’t buy right. Even a solid low-hour machine can end up costing an arm and a leg in maintenance and lost productivity.

The most critical calculation isn't the purchase price, though, it's the total cost of ownership (TCO). A new machine provides a predictable TCO, as it's backed by a multi-year warranty and in some cases a fixed-price servicing plan – plus it offers a far lower risk of being grounded.

By contrast, the TCO of a used machine is more unpredictable unless you operate your own workshop or are thoroughly acquainted with a particular model. The failure of a high-cost component like a final drive, hydraulic pump, slew ring or engine could instantly wipe out the initial savings.

Depreciation also falls within TCO, which is where new and old machines differ quite dramatically. A new excavator will face its steepest value drop in the first two years, while a used machine is typically well past this initial depreciation period. However, a new machine will inevitably command a stronger resale or trade-in value should you sell or upgrade.

“It’s easy to focus on the sticker price, but smart buyers look at total operating cost,” said Mauro Starc, Sales Manager at Brandt, the John Deere dealer for South Australia, Tasmania and key markets in Victoria.

“It’s not just about what you pay on day one; it’s about what you pay every month to keep that machine running. With used equipment, those maintenance and service costs can add up quickly compared to a new model.”

When it comes time to sign on the dotted line, it’s important to consider that financing a new asset often comes with a better interest rate – and Australian tax incentives usually favour new equipment. Of course, insurance costs are likely to be higher for a new machine, due to the fact it will be worth more as it stands.

An excavator's reliability hinges on various high-wear components, which is why a high-hour machine doesn’t mean you should write a potential used option off. If the usual culprits have been replaced, or aren’t worn, even well-used machines can prove reliable.

With a used machine, you are inheriting the maintenance history, or lack thereof, and the financial risk of component failures. A pre-purchase inspection is a must, and the condition of the undercarriage, slew ring, hoses, pins and bushes offer a fair indication of its service life. Here’s what to look out for when buying a used excavator.

Of course, even a thorough pre-purchase inspection can’t predict everything, so if you want complete and utter peace of mind a used machine might not be for you.

This is where a new machine offers the key advantage of a factory warranty, covering you in the event of a fault or failure. There’s also the benefit of dealer support to answer everything from general operation to technical queries.

“One big advantage of buying new is that all your servicing costs are built in,” says Starc.

“At Brandt, we call customers every three months – or every 500 hours – to book them in, so they never have to think about it.

“Whether it’s new or used, we make sure every machine runs right. But with new equipment, you get real peace of mind with a five- or seven-year warranty and a service agreement that rolls everything into one predictable monthly cost.”

When it all boils down, even a new machine can experience a component failure so there’s no such thing as an unbreakable excavator. A new one, though, won’t come with the costly repair bill if a part fails prematurely.

Productivity on a modern worksite is defined by technology, whether we like it or not. With electronic work diaries in trucks, pin-point accurate GPS in machinery and drones for surveying, construction sites have become tech-rich environments.

This is where new excavators have a clear advantage with built-in smarts like GPS, telematics, and even programs that help make the operator’s job safer and more efficient.

Systems like Volvo's Dig Assist, Komatsu’s 3D Machine Guidance and Cat's Grade Control with 3D, and John Deere Smart Grade are far more than marketing gimmicks. These systems will make a gun operator even better, and they’ll help bring a less experienced operator up to scratch.

“It’s not so much about getting more work done but getting it done right because this technology means you don’t have any undercuts or overcuts or reworks,” says Starc.

“OEMs know skilled operators are in short supply, so the machines are easier to run. That helps new operators perform and reduces rework for experienced ones too.”

On-board telematics systems then offer information like idle times, fuel burn, and machine location, allowing you to fine-tune your operation to bring costs down further while maintaining productivity.

Older machines will require systems like these to be retrofitted, which adds cost and downtime to the equation. Of course, an older machine does offer the benefit of being simple, both to work on and operate.

It all comes down to what your operation looks like. For some, a simple no-frills machine will get the job done. Others will see the productivity and efficiency benefits of a high-tech excavator.

The daily fuel bill is a major operating expense, but the latest generation excavators are more efficient than ever. This won’t just bring your diesel bill down: it might land you jobs.

A modern machine with an advanced Stage V/Tier 4f engine, load-sensing hydraulics and integrated eco modes will consume significantly less diesel than a model from a decade ago. For example, a Stage V engine can be up to 10 per cent more fuel efficient than a Stage IV engine, so consider the potential savings with a new model across a year or two.

Modern machines are better for the environment, too, which gives operators a commercial advantage. Tenders for Tier 1 infrastructure projects in Australia increasingly demand the latest environmental standards, which should be considered if you intend to work on major developments.

“We have conversations with customers everyday around the differences between Tier 3 and Tier 4 fuel efficiencies,” says Starc.

“Your CO2 emissions are directly related to the amount of fuel that you burn, so the less you burn the less you emit. Some of the diesel-electric drive machines, like our new John Deere 944X loader, are using 35 per cent less fuel – so it’s massive.”

Taking this one step further, there are even zero-emission electric models on offer from manufacturers like Volvo, Komatsu, CAT and others, suited to urban environments and confined spaces. Although, they’re yet to make their way onto the used market.

Do you need an excavator today, tomorrow, or did you need one yesterday? Your project timeline will often make this decision for you.

While new machines are plentiful, you will often have to wait for the specific model you’re after. It might only be a few weeks, but for some operators that just won’t cut it.

The real advantage of the used market is immediacy. You can win a contract that starts next week and have a used machine on a float and ready to work within a matter of days, with used marketplaces like constructionsales ready to do the heavy lifting.

A trade-off is that you get what's available, which may not be the perfect machine for your long-term goals. You might make do, but it’s a significant outlay if it isn’t exactly what you’re after.

Buying new allows you to spec-up the right machine for your needs. If time is on your side and the numbers work for you, it’s an ideal scenario.

“New units usually arrive unassembled and not yet inspected, and they may not have the attachments or hitch you’re after,” says Starc.

“Set-up takes time, but the payoff is a machine built to your specs with servicing included.”

For operators set on a used machine, Starc’s advice is to buy from a well-known dealer and have the machine checked out before you sign on the dotted line.

“Good dealers and manufacturers fully inspect used machines before resale, so you’ll get a clear report on any issues and how much life is left in major components,” says Starc.

“Every trade-in is run through the workshop and brought back up to manufacturer standards before going out again.”