Aircraft Operating Costs: An Analysis.
Thread Starter
Aircraft Operating Costs: An Analysis.
I dont think many pilots (and some operators) understand the concept or major components of aircraft operating costs. I often get asked for particular aircraft operating cost calculations.
Below is an example of costs for a Series 300 Twin Otter.
Note: These costs were current five or six years ago and no doubt, costs have increased significantly since then. They are based on an annual utilisation of 1,500 MR hours per annum and do not include non operating costs, such as pilot overnight costs, administration, accounting etc.
The purpose of this post is to provide a matrix of cost factors, the principal of which generally applys to all aircraft, from a Tiger Moth to a 747!
Indirect Operating Costs (or Annual Costs) are those costs which an operator incurs whether the aircraft flies or not.
Direct Operating Costs (or Hourly Flying Costs) are those costs incurred each hour the aircraft operates.
Sorry if the layout is not too clear PPRuNe is not set up for financial analysis documents.
Hope some find this useful!
De Havilland DHC6 Series 310/320 Twin Otter
........... .. Aust $
1 INDIRECT OPERATING COST: (Annual Cost)
A Debt Serviceing Cost:
US$0.8 mil = Aus$ 1.4 mil @ 7.0% pa ..98,245
B Insurance:
Hull - Aus$ 1.5 Mill @ 1.5% pa .. . ..22,500
Liabilities ........... . ..6,000
C Re-furbishment:
Aus $ 10,000 pa .. ....... .. 10,000
TOTAL INDIRECT (ANNUAL) OPERATION COST..Aus$ 209,505
Estimated Utilisation - 1,500 Flight Hrs pa....Aus$ .. 139.67
...... ..per Flight Hour
2 DIRECT OPERATING COST: (Hourly Cost)
A Aircrew:
Captains x 2 @ $45,000 90,000
F/O x 2 @ $30,000 .60,000
Plus 25% On Cost ..37,500
Total .. ..$187,500 @ 1,500 hrs pa..125.00
B Fuel:
337 liters/hr @ $0.8997 ..... .303.20
Lubricants ........... ..10.00
C Maintenance - Labour:
Engine / Airframe / Avionics
2.5 hr/flt hr @ $80.00 ...... 200.00
D Maintenance - Airframe Parts:
US$ 100 / flt hr @ .57 .. 175.45
Plus: 10% Contingency . 17.55
Total ............. .193.00
E Engine Provisions:
Overhaul:
US$ 150,000 (Aus$ 263,160) per 5,000 hrs X 2 ..105.25
Hot Section:
US$ 20,000 (Aus$ 35,090) per 1,500 hrs X 2 46.75
Starter/Generator:
US$ 2,000 (Aus$ 3,508) per 1,200 hrs X 2 ..5.85
F Propellor Provisions:
US$ 8,500 (Aus$ 14,915) per 3,000 hrs X 2 .9.95
G Flight Related Charges:
ERCs ..25.00
Landing Fees .50.00 .75.00
TOTAL DIRECT (FLIGHT HOUR) COST .Aus$ 1,074.27
per Flight Hour
INDIRECT OPERATING COST .Aus$ 139.67
per Flight Hour
TOTAL OPERATING COST .Aus$ 1,213.94
..per Flight Hour
Below is an example of costs for a Series 300 Twin Otter.
Note: These costs were current five or six years ago and no doubt, costs have increased significantly since then. They are based on an annual utilisation of 1,500 MR hours per annum and do not include non operating costs, such as pilot overnight costs, administration, accounting etc.
The purpose of this post is to provide a matrix of cost factors, the principal of which generally applys to all aircraft, from a Tiger Moth to a 747!
Indirect Operating Costs (or Annual Costs) are those costs which an operator incurs whether the aircraft flies or not.
Direct Operating Costs (or Hourly Flying Costs) are those costs incurred each hour the aircraft operates.
Sorry if the layout is not too clear PPRuNe is not set up for financial analysis documents.
Hope some find this useful!
De Havilland DHC6 Series 310/320 Twin Otter
........... .. Aust $
1 INDIRECT OPERATING COST: (Annual Cost)
A Debt Serviceing Cost:
US$0.8 mil = Aus$ 1.4 mil @ 7.0% pa ..98,245
B Insurance:
Hull - Aus$ 1.5 Mill @ 1.5% pa .. . ..22,500
Liabilities ........... . ..6,000
C Re-furbishment:
Aus $ 10,000 pa .. ....... .. 10,000
TOTAL INDIRECT (ANNUAL) OPERATION COST..Aus$ 209,505
Estimated Utilisation - 1,500 Flight Hrs pa....Aus$ .. 139.67
...... ..per Flight Hour
2 DIRECT OPERATING COST: (Hourly Cost)
A Aircrew:
Captains x 2 @ $45,000 90,000
F/O x 2 @ $30,000 .60,000
Plus 25% On Cost ..37,500
Total .. ..$187,500 @ 1,500 hrs pa..125.00
B Fuel:
337 liters/hr @ $0.8997 ..... .303.20
Lubricants ........... ..10.00
C Maintenance - Labour:
Engine / Airframe / Avionics
2.5 hr/flt hr @ $80.00 ...... 200.00
D Maintenance - Airframe Parts:
US$ 100 / flt hr @ .57 .. 175.45
Plus: 10% Contingency . 17.55
Total ............. .193.00
E Engine Provisions:
Overhaul:
US$ 150,000 (Aus$ 263,160) per 5,000 hrs X 2 ..105.25
Hot Section:
US$ 20,000 (Aus$ 35,090) per 1,500 hrs X 2 46.75
Starter/Generator:
US$ 2,000 (Aus$ 3,508) per 1,200 hrs X 2 ..5.85
F Propellor Provisions:
US$ 8,500 (Aus$ 14,915) per 3,000 hrs X 2 .9.95
G Flight Related Charges:
ERCs ..25.00
Landing Fees .50.00 .75.00
TOTAL DIRECT (FLIGHT HOUR) COST .Aus$ 1,074.27
per Flight Hour
INDIRECT OPERATING COST .Aus$ 139.67
per Flight Hour
TOTAL OPERATING COST .Aus$ 1,213.94
..per Flight Hour
Thread Starter
No, I don't have Bras and Dash operating costs, but you should be able to get some idea of the costs and use the above matrix.
Beware of manufacturer claimed operating costs. Operators also tend to keep their costs confidential.
The only valid comparison between aircraft types is costs over the same specific sector, reduced to either "Revenue/Passenger/Kilometers" (RPK's) or "Revenue/Tonne/Kilometers" (RTK's), which allows for differing block times and differing payloads. I have an example of RPK/RTK calculations if you need it and a comparison between types (DHC6-300 versus C208 I think it is.)
But at a guess, I would think the DHC8-100 would have significantly higher cost RPK's/RTK's than the Bras. The difference would reduce if the E120ER was compared to the DHC8-200 (due to higher cruise speed and possibly greater payload), although I still think the E120ER would come out ahead.
Beware of manufacturer claimed operating costs. Operators also tend to keep their costs confidential.
The only valid comparison between aircraft types is costs over the same specific sector, reduced to either "Revenue/Passenger/Kilometers" (RPK's) or "Revenue/Tonne/Kilometers" (RTK's), which allows for differing block times and differing payloads. I have an example of RPK/RTK calculations if you need it and a comparison between types (DHC6-300 versus C208 I think it is.)
But at a guess, I would think the DHC8-100 would have significantly higher cost RPK's/RTK's than the Bras. The difference would reduce if the E120ER was compared to the DHC8-200 (due to higher cruise speed and possibly greater payload), although I still think the E120ER would come out ahead.
Last edited by Torres; 7th Oct 2003 at 06:54.
Join Date: Feb 2001
Location: OZ
Posts: 114
Likes: 0
Received 0 Likes
on
0 Posts
I read somewhere that in 2005 the E120 (early 90's built) will have a book value of $1.3 - $1.5M USD and by 2010 they will be scrap value. The Dash 8-100 would be valued at $1.8-$2.2 in 2005 and $800,000 - $1M in 2010.
The savings I see for the E120 will be,
1. Crew cost (due to it's lower MTOW), therefore based on the GA Award they are paid less than Dash 8 crews.
2. Fuel, E120 buring 1000Ibs/hr against 1200Ibs/hr in the Dash.
3. Landing fees and Enroute charges, due to the lower weight of the E120.
4. Debit Serviceing Cost, due to lower purchase price of the E120.
5. Insurance cost.
The savings I see for the E120 will be,
1. Crew cost (due to it's lower MTOW), therefore based on the GA Award they are paid less than Dash 8 crews.
2. Fuel, E120 buring 1000Ibs/hr against 1200Ibs/hr in the Dash.
3. Landing fees and Enroute charges, due to the lower weight of the E120.
4. Debit Serviceing Cost, due to lower purchase price of the E120.
5. Insurance cost.
Thread Starter
Your reasoning on EMB120 and DHC8 values may, or may not be correct. I remember a few years ago when EMB110 Bandeirantes were worth the remaining hours on the engines, the aircraft were being parted out and engines converted to -34AG's. Now Bandits have again risen in value. Supply and demand.....
I suspect the Bras may be about to become very popular due to it being the logical growth aircraft for GA companies developing into low capacity RPT operations, or smaller LCRPT operators requiring greater capacity.
1 All below DHC8 gross weight were exempt from en route charges(?) or subject to a lower charging regime(?), so the Braz should have significantly lower nav charges.
2 Rest of your points are valid, except the Bras has lower capacity payload. The only valid comparison will be RPK's or RTK's over your proposed operational sectors.
I suspect the Bras may be about to become very popular due to it being the logical growth aircraft for GA companies developing into low capacity RPT operations, or smaller LCRPT operators requiring greater capacity.
1 All below DHC8 gross weight were exempt from en route charges(?) or subject to a lower charging regime(?), so the Braz should have significantly lower nav charges.
2 Rest of your points are valid, except the Bras has lower capacity payload. The only valid comparison will be RPK's or RTK's over your proposed operational sectors.
Props are for boats!
Join Date: Oct 2000
Location: An Asian Hub
Age: 56
Posts: 994
Likes: 0
Received 0 Likes
on
0 Posts
Good thread Torres.
FL CH ,
Be Carefull with your Dash8-100 idea. These ships arent getting younger. Youll be looking at Air frames between late seventies and early eighties. The ones operated at my previous company are very average. They have umpteen problems with the ECU also Pressurisation faults. The list goes on. Also many dont have APUs which intern puts alot of pressure on Batteries and Aircon units. Most of ours the Aircon werent available on the ground and Ground packs had to be used. Plus youll get around 2000lbs in the luggage hold, which with 35-37 pax usually isnt feasable. Im not saying but EMB120 , dont think they are much better myself. I would try and get a atleats a -200 or -300 Dash 8 if you can lash out more. Try leasing the airframe and engines. Alot of European and US ops are doing this with results these days.
Oh I see youre fuel burn figures. I trust your 1200lbs/hr is for s -200? The das8-100s here were working on a 1000lbs/hr. But this is all relative to alttitude and your sector length guys. Both of these beasts on short sectors will burn it baby. I assure you.
Regards
Sheep
p.s Torres your comparison is based on a conversion rate of .57uscents. Well as you know its .66uscents at the moment. Which would make it look abit cheaper for maintenance parts atleast. Its really futile though that cost is reliant on currecny conversion. Crazy world we live in.
FL CH ,
Be Carefull with your Dash8-100 idea. These ships arent getting younger. Youll be looking at Air frames between late seventies and early eighties. The ones operated at my previous company are very average. They have umpteen problems with the ECU also Pressurisation faults. The list goes on. Also many dont have APUs which intern puts alot of pressure on Batteries and Aircon units. Most of ours the Aircon werent available on the ground and Ground packs had to be used. Plus youll get around 2000lbs in the luggage hold, which with 35-37 pax usually isnt feasable. Im not saying but EMB120 , dont think they are much better myself. I would try and get a atleats a -200 or -300 Dash 8 if you can lash out more. Try leasing the airframe and engines. Alot of European and US ops are doing this with results these days.
Oh I see youre fuel burn figures. I trust your 1200lbs/hr is for s -200? The das8-100s here were working on a 1000lbs/hr. But this is all relative to alttitude and your sector length guys. Both of these beasts on short sectors will burn it baby. I assure you.
Regards
Sheep
p.s Torres your comparison is based on a conversion rate of .57uscents. Well as you know its .66uscents at the moment. Which would make it look abit cheaper for maintenance parts atleast. Its really futile though that cost is reliant on currecny conversion. Crazy world we live in.
Last edited by Sheep Guts; 7th Oct 2003 at 21:05.
Join Date: Sep 2000
Posts: 14
Likes: 0
Received 0 Likes
on
0 Posts
Sheep Guts check your years, you can't get a Dash from the "late seventies" because the beast didn't fly until 1984. 1200 pounds per hour is the block fuel rate on the -100. Easy to remember for x-Bandit pilots, just double the Bandit rate. In OZ where all the -100s are fitted with 36 seats each pax can have 25kg of bags in the back.
Thread Starter
JetPack. You may be correct, but the Talair machines were Serial Nos 50-something and 150-something and I thought the first one came in 1985? (or was it '86?).
Sure the Dash has a bigger cabin, more seats etc. Asset if you can fill them, liability if you can't. 'Orses for courses!
Sheep. The Dash 8 100's are getting tired and I'm not convinced the Series 200 displays lower RPK's/RTK's. Certainly the Series 300 is far more cost efficient - provided you have the bums to fill it!
Don't remember when I compiled those costs but it must have been around 1999 when the Ozzie Peso was at 57 cents. This morning it was 69 cents, so there will be some savings in component overhaul and replacement costs, but I'm sure other costs would have risen.
I thought the Bandit burnt around 650 pound per hour? Also seem to recall the Bras burns around 900 pound/hour?
Sure the Dash has a bigger cabin, more seats etc. Asset if you can fill them, liability if you can't. 'Orses for courses!
Sheep. The Dash 8 100's are getting tired and I'm not convinced the Series 200 displays lower RPK's/RTK's. Certainly the Series 300 is far more cost efficient - provided you have the bums to fill it!
Don't remember when I compiled those costs but it must have been around 1999 when the Ozzie Peso was at 57 cents. This morning it was 69 cents, so there will be some savings in component overhaul and replacement costs, but I'm sure other costs would have risen.
I thought the Bandit burnt around 650 pound per hour? Also seem to recall the Bras burns around 900 pound/hour?
Props are for boats!
Join Date: Oct 2000
Location: An Asian Hub
Age: 56
Posts: 994
Likes: 0
Received 0 Likes
on
0 Posts
I stand corrected they were mid eighties. Irrespective the ones we had here are buckets......
Thanks for the heads up Jet Pack. I used 600lbs an hour on the Twoter Actually again depends what alt you operate. I can get 350lbs an Hour out of a A90 King Air, and still block TAS at 200KTS.
I ve copied your analysis Torres, hope theres no copyright
Regards
Sheep
P.S. Come to think of it -200 are still pricey, thats why people still going for EMB120s they are cheap and there are buckets parked in the Mojave. Just ask Air North theirs seem to be a sucess story.
Oh Jet Pack
Yes this works well. Try carrying Yank Tourists who carry half the Kitchen sink to go to an all inclusive resort.
Thanks for the heads up Jet Pack. I used 600lbs an hour on the Twoter Actually again depends what alt you operate. I can get 350lbs an Hour out of a A90 King Air, and still block TAS at 200KTS.
I ve copied your analysis Torres, hope theres no copyright
Regards
Sheep
P.S. Come to think of it -200 are still pricey, thats why people still going for EMB120s they are cheap and there are buckets parked in the Mojave. Just ask Air North theirs seem to be a sucess story.
Oh Jet Pack
In OZ where all the -100s are fitted with 36 seats each pax can have 25kg of bags in the back.
Last edited by Sheep Guts; 8th Oct 2003 at 10:13.
Just to clarify dates. Dash 8 prototype first flew in June 1983, and certified in late 1984. Entered service shortly after.
Bandits are usually planned on 600 lbs an hour to make it easy for calcs. Actual fuel burn is about 580 lbs/hr.
Bandits are usually planned on 600 lbs an hour to make it easy for calcs. Actual fuel burn is about 580 lbs/hr.
Thread Starter
Sheep. No copyright - fill ya boots! Should not be too hard to change costs from the Otter to a Beech A90.
An A90!! That would have to be older than most pilots that fly it. Only one I ever saw (in the Philippines) didn't even have reverse thrust!
GA Boy. My Bandit fuel burn was from memory only. I recall the DHC6 Series 200 Otter (-20 engines) block fuel burn was around 550 pounds per hour.
Talair must have received their first Dash 8 in 1986, although they had an earlier serial number on loan from Tyrolean Airlines. The two ex Talair Dash 8's are currently in West Australia I believe.
An A90!! That would have to be older than most pilots that fly it. Only one I ever saw (in the Philippines) didn't even have reverse thrust!
GA Boy. My Bandit fuel burn was from memory only. I recall the DHC6 Series 200 Otter (-20 engines) block fuel burn was around 550 pounds per hour.
Talair must have received their first Dash 8 in 1986, although they had an earlier serial number on loan from Tyrolean Airlines. The two ex Talair Dash 8's are currently in West Australia I believe.
Props are for boats!
Join Date: Oct 2000
Location: An Asian Hub
Age: 56
Posts: 994
Likes: 0
Received 0 Likes
on
0 Posts
Torres,
They are actually 65-A90s they were ex USARMY and have had all the mods along the way so they now have Reverse,Auto feather and a Modern King Stack with Multi-Crew Cockpit layout. One of Ours even has the new Garmin GPS530 Colour Display Gps comms+ Bendix Colour weather RADAR to boot. So they aint as old as prolly the one you remmember seeing ..
Sheep
They are actually 65-A90s they were ex USARMY and have had all the mods along the way so they now have Reverse,Auto feather and a Modern King Stack with Multi-Crew Cockpit layout. One of Ours even has the new Garmin GPS530 Colour Display Gps comms+ Bendix Colour weather RADAR to boot. So they aint as old as prolly the one you remmember seeing ..
Sheep
Join Date: Feb 2001
Location: OZ
Posts: 114
Likes: 0
Received 0 Likes
on
0 Posts
Torres
You are correct, both the Talair Dash 8's are in WA with Skippers.
VH-XFT: Serial number 052 built 1986.
VH-XFU: Serial number 151 built 1989.
A few queations for you, why did FWA go for more Brasilia's instead of purchasing more Dash 8's? When FWA first got their Brasilia they around had the Dash 8's from Talair.
How successful were the Brasilia flights between CG and CB, it's a long way in a turboprop?
You are correct, both the Talair Dash 8's are in WA with Skippers.
VH-XFT: Serial number 052 built 1986.
VH-XFU: Serial number 151 built 1989.
A few queations for you, why did FWA go for more Brasilia's instead of purchasing more Dash 8's? When FWA first got their Brasilia they around had the Dash 8's from Talair.
How successful were the Brasilia flights between CG and CB, it's a long way in a turboprop?
Last edited by FL CH; 9th Oct 2003 at 20:05.
Thread Starter
Don't know FL CH. I had left Flight West by the time the Dash 8's arrived from PNG.
But I would suspect:
1. Some of the routes could not support a 36 seat aircraft without reduction in frequency.
2. The Dash 8 seat/mile cost was significantly higher than the Brasilia seat/mile cost.
3. The Bras was quicker than the Dash 8.
Frequency is one of the secrets of success. The Bras was quicker and offered a similar cabin class aircraft as the Dash 8.
I would also think selling the two Dash 8 - 100's then would give a far better price than selling them today.
For interest, I seem to recall Serial No 052 cost around US$5.5 mill, new and the spare engine, around US$500,000. Very cheap by today's standards!
But I would suspect:
1. Some of the routes could not support a 36 seat aircraft without reduction in frequency.
2. The Dash 8 seat/mile cost was significantly higher than the Brasilia seat/mile cost.
3. The Bras was quicker than the Dash 8.
Frequency is one of the secrets of success. The Bras was quicker and offered a similar cabin class aircraft as the Dash 8.
I would also think selling the two Dash 8 - 100's then would give a far better price than selling them today.
For interest, I seem to recall Serial No 052 cost around US$5.5 mill, new and the spare engine, around US$500,000. Very cheap by today's standards!
