Heavy construction equipment fleet is a critical resource for large contractors. To keep competitive in the market, the contractor needs to identify these candidates of equipment items for timely replacement. Equipment managers are often called upon to make complex economic decisions involving the equipment in their charge. In heavy construction works, optimizing, equipment selection based on economic operation analyzes has a primary role in the success of construction projects. Economic analysis is mainly focused on determining the owning and operations costs. The aim of this thesis is to identify and evaluate the main factors affecting on the replacement of construction equipment from building an integrated model covers all cost expenses. The objectives of the model should be to optimize the life-cycle costs and the economic life of the equipment. The model of replacement is based on the calculations of the equivalent uniform cost. The model was applied to the mechanical crane, (Link Belt 150 Ton) and concrete pump (Schwing KVM 32X). Real data were taken from an Iraqi Construction Company to compare results of the actual data to the nominal. The model provides a sensitivity analysis and a random search with respect to changes of different costs. The mathematical model is simulated using MATLAB toolboxes, to perform and track fundamentally changes of all input data over the time of equipment operation; the model of replacement was simulated running randomly, to be an able precise analysis of price changes, to be a realistic analysis, which reflects actual situation of unstable business markets. Therefore, the confidence levels along with the sensitivity analysis provide a trigger point that signals when the equipment manager should consider replacing a piece of equipment as it nears the end of its optimum economic life.