The High Cost of Renting

In 1971, the cost of renting airplanes was expensive.  The sad truth about aircraft rental today is that it still remains too expensive.  Relatively speaking, it is more expensive than 35 years ago.  In 1971, a Cessna 150 cost $15 per hour.  Divided by the minimum wage at that time of $1.60, the exchange was 9.4 hours of work per hour of flight.  Today the very same Cessna 150, now old and tired, rents for about $80 per hour.  At today’s minimum wage of $7.25, that equals 11.0 work hours per flight hour.  This begs the question of how in the world can young kids afford flight training. 

Assuming the average private pilot spends 30 hours dual and 25 hours solo at $109.00 dual and $80.00 solo respectively, students will pay $5,270 in rental and instructional fees.  Tacked onto this will follow other charges for ground instruction, textbooks, navigation plotters, computers, testing fees, and the bill for the checkride.  All told, the final cost for earning a private pilot certificate can easily exceed $6000 or $7000, sometimes more than $10,000.

Six or seven thousand dollars is a lot of money.  Young people, especially those with dreams right out of high school, don’t have that kind of money.  Consequently, they spend their money on things more within their grasp, putting off flying lessons until later.  Sometimes a whole lifetime later; sometimes forever.  And who suffers?  They do and so do those of us in the aviation industry.  Eventually, the flying public will also suffer—airlines have already canceled flights for lack of aircrew.

In aviation training today, dual rates average $95 to $150 per hour or more.  Students have grumbled about the high cost of flight training while assuming flight instructors and flight school owners are getting rich.  Unfortunately, as those of us in the business know, such is not the case.

While it would seem flight school operators enjoy a high degree of profit, in most cases this is untrue.  Those who reap the rewards of high rental rates are the gas companies, parts manufacturers, insurance carriers, and local governments.  Oh by the way, those rewards are relatively small.  In short, everyone is profiting from the high costs except the owner of the flight school and the flight instructors.  Unfortunately, many suppliers and vendors have their fingers in the money bucket.

Assuming a small flight school has five aircraft and a small operation at a municipal airport, the numbers might stack up something like this for an operation of 2500 hours per year:

This is a rather conservative estimate.  As you can see, the cost of operation is at $113.20 per hour for the aircraft.  That’s cost.  Tack on 15 percent for profit—again, a rather conservative estimate—and the rental rate comes out to be $130 per hour.  At a 15 percent markup, the owner of the flight school nets only $42,450.  After taxes, take home is about $29,000. 

No one is getting rich at that rate.

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© 2011 J. Clark

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