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RotorGypsy

Air Time Vs. Flight Time

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Its the same thing with sampling

 

You are on the ground for 5 min at a time and its often less than 2 minutes to get to the next spot. If you charged them a .2 for every flight it would end up costing them more. They dont want you to shut down and they expect to pay for you to sit on the ground becuase its actually cheaper.

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Vortex:

 

Example: 10 A/C operation with a manufacturers operating costs for component replacement etc. (always bs) $500/hr

 

When you are renting a helicopter the hourly rate is what it costs the company to operate that helicopter + profit and overhead which includes your salary.

 

For non mgt types I should of stated the obvious, you are in the business of selling hours of helicopter use. So, what you are selling has to give you a return to cover your cost of doing business.

 

The obvious is the cost of running that helicopter for one hour, lets say $500/hr.

 

The whole company overhead, including every bodies salary to run the operation becomes a percentage of the estimated income($3M), lets say 15% for overhead.

 

Estimated profit at 20%.(day dreaming) Also known as return on investment.

 

10 machines x $500/hr x 600hr/yr/machine = $3,000,000

15% overhead per a/c 450,000

20% return on investment 690,000

 

Hourly rate for the one machine is $690/hr.

 

Cheers, Don

 

PS: Another way is the hourly rate is usually 10% of the purchase price, new.

 

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For non mgt types I should of stated the obvious, you are in the business of selling hours of helicopter use. So, what you are selling has to give you a return to cover your cost of doing business.

 

 

Cheers, Don

 

PS: Another way is the hourly rate is usually 10% of the purchase price, new.

Don, I see billing flight time or air time as just a different way to skin the cat. If a customer only pays air time then it is up to the operator if they want to work for that. If they pay minimums is another factor in the equation which sends the flight time / air time math right out the window...Heliskiing is a great example of customers that only pay air time...the pilot sits in the seat while the aircraft is running for 6+ hours a day doing one of the most demanding jobs we can do with a helicopter and can only bill 3.5. If the operator or the pilot doesn't like that math, they don't have to do it.

As for the old 10% thing in my opinion it doesn't work anymore...A used Jetranger can be bought for $500k USD and the rate is $1000/hr. and a used AS350B3 is in the $2.5m USD area and it only fetches around $1900/hr.

And just as an aside, the average profit for a helicopter company according Conklin & DeDeker is somewhere in the 4% area.

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Votex, I don't disagree with what you are saying, I was using imaginary numbers.

 

If what you are saying is fact, you are basically saying that the industry is f__up.

 

Imagine that, but wait, SMS will cure that, or is it ISM.

 

Cheers, Don

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Some good advice Don. Everyone does things a bit different, it seems.

 

It sounds like your entering ground running time, while getting crews in and out, as airtime to the a/c total airframe time. Thus making it identical to the billing, to insure there isn't the appearance of ripping off the client.

 

We'll have to agree to disagree on this practice.

Just some food for thought: If you just Ground Idled your machine for 5000 hours and never pulled collective once. (came up with 5000 hours just for Sh**s and giggles) And your journey log air time got 0.0 hours air time, your telling me that there would be no wear and tear on any rotating parts? :unsure:

 

I believe if your customer wants the machine running he/she should pay for it.

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Just some food for thought: If you just Ground Idled your machine for 5000 hours and never pulled collective once. (came up with 5000 hours just for Sh**s and giggles) And your journey log air time got 0.0 hours air time, your telling me that there would be no wear and tear on any rotating parts? :unsure:

 

I believe if your customer wants the machine running he/she should pay for it.

 

The rotating components replacement times are based on time in the air. There is no requirement to add ground running time to the airframe time in the journey log, and yes if you ran for 5000 hours on the ground, legally it is zero time.

 

Realistically speaking, of course there is wear and tear and I suspect manufacturers calculate a certain amount of running time into the overhaul time equation. (As well as cycles) There is also a tolerance built into the times to allow for variation in operating environments, and no doubt time recording practice, among other factors.

A component on extension is not uncommon.

 

The customer paying if they want it running topic has been beat to death, but yes that should be the goal for all contracts if possible. As one poster pointed out, the client should be aware however, that the billing clock is running. In some cases this practice actually saves the client money and his time is not wasted waiting for the repeated start procedure. It helps keep the bugs away in the summer, the cab warm in the winter, and the battery charged up!

 

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