Making informed decisions regarding the timing of S&C renewal is crucial for infrastructure managers (IMs) to minimize socio-economic costs. This includes the design of maintenance contracts since it will influence the life cycle cost (LCC) of the asset. The purpose of this paper is to estimate the economic impact of cumulative tonnes on S&Cs and evaluate the effect of maintenance contract design. The aim is that the established relationships can be used to find a better time for switch renewal and improve the design of maintenance contracts with respect to a reimbursement rule. Under this rule, the Swedish IM compensates the contractor for costs exceeding a certain threshold, whilst the contractor is responsible for costs below the threshold. The threshold varies between maintenance contracts, where a higher threshold creates stronger incentives for preventing costly corrective activities.

In the context of railway systems, LCC has been extensively used to study the renewal and maintenance actions associated with various infrastructure assets. Some studies have demonstrated the use of LCC to optimise maintenance and renewal planning by combining it with other methods, such as reliability, availability, maintainability, and safety (RAMS) analysis, and cost-benefit methods. However, to the best of the authors’ knowledge, this paper is the first to evaluate reimbursement rules in railway maintenance contracts with respect their impact on LCCs. 

Based on empirical data on preventive and corrective maintenance activities, a survival analysis is used to study the timing of events and the impact of various factors such as cumulative load, S&C characteristics, and maintenance contract design. The regression estimates are linked to unit costs for maintenance, train delays, and renewals in an LCC model.

The estimated cumulative hazards for preventive maintenance, corrective maintenance, and failures causing train delays illustrate the number of activities/events accumulating until 75 years have elapsed since the S&C was installed. The estimation results show that a higher reimbursement threshold (which implies a higher cost responsibility for the contractor) generates fewer corrective activities.