Mothballing in the army

Abstract

Modern armies mothball tanks, ships, planes, and vehicles. Up until now Turkish Army has not used mothballing. The surplus weapons are stored in arsenals. We just leave them idle vulnerable to rusting and try to keep them alive by maintenance; in fact we just let them die. The General Staff of the Turkish Army is planning to use mothballing, and giving an end to the wasting of unused weapons. This thesis proposes the use of real option modelling to be used in the mothballing decisions of military equipment for surplus in military hardware. Also, model can determine conditions for when to mothball, to switch back to full deployment status as well as abandonment of hardware.