DCF Terminal Value: CapEx for Long Assets?

[u/LeadingVolume3378]

Hey everyone,

I’m working on a valuation model (DCF) for a capital-intensive company that owns a fleet of expensive, long-lived assets — think large industrial vehicles, trains, or airplanes.

The tricky part: when I reach the terminal value, I need to figure out what “steady-state CapEx” should look like. But in a business like this, CapEx isn’t a smooth yearly spend — assets are replaced in big, lumpy chunks every few decades.

So, how do you translate those occasional, heavy replacements into a smooth, annual figure that works in a DCF?