Block time or partners

[Ernie Martin]

I don't think anyone rents 337s, so it may be hard to come up with a rental rate. But let me take a stab at approaching it from two viewpoints.

Cost Model
First, what are the operating costs per hour on a Skymaster? If we can get a decent handle on this, then we have a floor, with rental being something above this floor. There have been a number of threads here about operating costs, but let me steer you to one that's easy to find. If you go to the third thread (What to look for when buying a Skymaster), fifth message, you will find this link www.skymaster.org.uk/purchase.asp which has a discussion on operating costs. There, and allowing for some inflation, a rule of thumb is proposed that non-fuel operating costs are roughly equal to $3.00 times number of gallons burned. If an average burn (including takeoffs) is 22 gal per hour, then, by this model, non-fuel operating costs are about $66 per hour. So, if the "renter" uses the aircraft on a Saturday for three hours, you might expect him/her to pay, say a 50% premium on top of this, or about $300 for 3 hours (plus fuel, of course).

But wait. That might cover the wear-and-tear aspects of operating costs (engine and prop reserves, tires, brake pads, oil changes, spark plugs, etc.), but what about fixed costs, those that are relatively insensitive to use (tiedown or hangar, insurance, annual inspection, etc.). Should those be included in the rental base? I once did a cost analysis for my aircraft, which is tiedown (not hangared) and uninsured, and came up with $123 per hour, nearly twice the $66 above (details at the end of this message). Add a 50% premium and a 3-hour "rental" is $550 (plus fuel).

What's the right amount? The first one? The last one? Somewhere in between? Who knows. It depends in part on what the owner is seeking. If he/she is concerned that the aircraft's lack of flight is hurting it (engine corrosion, for instance) and actually wants to put more hours on the plane, then the first figure seems right -- provided, of course, that the "renter" is someone who is going to take exquisite care of the airplane. If the owner wants to defray some of the ownership costs, then the second figure seems more logical.

Comparison With Other Rentals
A fundamentally different approach is simply to extrapolate from the rental costs of other aircraft. What's the closest twin to the Skymaster in the rental fleet? Take that and adjust moderately if the Skymaster is in cherry condition and the twin rental is cosmetically beat up. Or how about taking a Cessna 172 rate and doubling it?

Ernie Martin




Cost Analysis For My Aircraft
Assume 100 hrs of operation per year

Overhead Items
Tie-down $85 * 12 ~ $1000
Annual Inspection ~ $5000 (includes misc. items thru the year, including small repairs, tires, oil changes, etc.)
Paint, windows ~ $10,000 every 10 years, so 1000 per year
Total $7000 per year, or $70 per hour

Per-Hour Items
$25000 per engine overhaul per 1,500 hours of flight = $33 per hour ($50000/1500hrs)
$5000 per propeller overhaul every 5 years (500 hrs) = $20 per hour ($10000/500hrs)
Total $53 per hour

Grand Total $123 per hour