{
  "slug": "part135-charter-rate",
  "title": "Part 135 Charter Hourly Rate Calculator",
  "heading": "Part 135 Charter Hourly Rate Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/part135-charter-rate",
  "summary": "Build a defensible charter rate from direct operating cost, overhead, and margin.",
  "description": "Charter operators price off direct operating cost per hour (fuel, maintenance reserves, crew pay allocated per flight hour) plus a markup that covers fixed overhead (insurance, hangar, dispatch, management fees, Part 135 certificate compliance costs) and target profit margin. Undercharging is common among new operators trying to compete on price, which erodes margin needed to fund reserves for engine overhauls and unscheduled maintenance. This calculator builds the rate up from real cost components so you can see what margin you're actually running at a given quoted rate.",
  "formula": "Direct cost/hr = fuel + maintenance reserve + crew cost/hr. Rate = (direct cost/hr + overhead/hr) ÷ (1 − target margin %).",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=part135-charter-rate",
  "inputs": [
    {
      "id": "fuelCost",
      "label": "Fuel cost per hour",
      "kind": "number",
      "hint": null,
      "default": 450,
      "unit": "$/hr",
      "min": 0,
      "max": null
    },
    {
      "id": "maintReserve",
      "label": "Maintenance/engine reserve",
      "kind": "number",
      "hint": null,
      "default": 220,
      "unit": "$/hr",
      "min": 0,
      "max": null
    },
    {
      "id": "crewCost",
      "label": "Crew cost per flight hour",
      "kind": "number",
      "hint": null,
      "default": 180,
      "unit": "$/hr",
      "min": 0,
      "max": null
    },
    {
      "id": "annualOverhead",
      "label": "Annual fixed overhead",
      "kind": "number",
      "hint": null,
      "default": 260000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "annualHours",
      "label": "Expected annual flight hours",
      "kind": "number",
      "hint": null,
      "default": 400,
      "unit": null,
      "min": 1,
      "max": null
    },
    {
      "id": "targetMargin",
      "label": "Target profit margin",
      "kind": "number",
      "hint": null,
      "default": 15,
      "unit": "%",
      "min": 0,
      "max": 50
    }
  ],
  "outputs": [
    {
      "id": "rate",
      "label": "Charter rate to quote",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "directCost",
      "label": "Direct operating cost per hour",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "overheadPerHour",
      "label": "Overhead allocated per hour",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "costPerHour",
      "label": "Total cost per hour",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "profitPerHour",
      "label": "Profit per hour at this rate",
      "format": "currency",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Fuel cost per hour: 450 $/hr",
      "Maintenance/engine reserve: 220 $/hr",
      "Crew cost per flight hour: 180 $/hr",
      "Annual fixed overhead: 260000 $",
      "Expected annual flight hours: 400",
      "Target profit margin: 15 %"
    ],
    "outputs": [
      "Charter rate to quote: $1,765",
      "Direct operating cost per hour: $850",
      "Overhead allocated per hour: $650",
      "Total cost per hour: $1,500",
      "Profit per hour at this rate: $265"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter fuel cost per hour ($/hr).",
      "Enter maintenance/engine reserve ($/hr).",
      "Enter crew cost per flight hour ($/hr).",
      "Enter annual fixed overhead ($).",
      "Enter expected annual flight hours.",
      "Enter target profit margin (%).",
      "Read your charter rate to quote on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "fuelCost": 270,
        "maintReserve": 130,
        "crewCost": 110,
        "annualOverhead": 155000,
        "annualHours": 240,
        "targetMargin": 9
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "fuelCost": 450,
        "maintReserve": 220,
        "crewCost": 180,
        "annualOverhead": 260000,
        "annualHours": 400,
        "targetMargin": 15
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "fuelCost": 720,
        "maintReserve": 350,
        "crewCost": 290,
        "annualOverhead": 415000,
        "annualHours": 640,
        "targetMargin": 24
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "Why does annual hours flown swing the rate so much?",
      "a": "Overhead is fixed regardless of hours flown, so a $260,000 annual overhead spread over 400 hours adds $650/hr, but the same overhead spread over 800 hours only adds $325/hr. Operators with strong utilization can profitably quote lower rates than low-utilization operators carrying the same fixed cost base, which is why charter pricing varies so much between operators flying the same aircraft type."
    },
    {
      "q": "What typically sits inside 'annual fixed overhead' for a Part 135 operator?",
      "a": "Certificate management and compliance costs, hangar/ramp fees, base insurance premium (liability plus hull), management/dispatch salaries, training costs for currency and recurrent checks, and administrative/back-office costs. For a single light jet operation this commonly runs $200,000-400,000/year depending on crew structure and base location."
    },
    {
      "q": "Is 15% margin realistic for charter?",
      "a": "It's a reasonable target for an established operator with good utilization; new entrants sometimes run thinner (5-10%) to win market share, which leaves little cushion for unscheduled maintenance or a slow season. Well-run charter operations with premium positioning can command 20-25%+ margins on high-demand routes or aircraft types."
    },
    {
      "q": "Does this rate include repositioning (deadhead) legs?",
      "a": "No — this calculates a straightforward billed flight-hour rate. Real charter quotes typically add a repositioning charge or build an average deadhead factor into the quoted trip price, since the aircraft and crew cost money whether or not a paying passenger is aboard on the return or positioning leg."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/aircraft-ownership-cost-per-hour",
    "https://www.revenuelab.fyi/toolbox/engine-reserve-fund"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Part 135 Charter Hourly Rate Calculator (https://www.revenuelab.fyi/toolbox/part135-charter-rate)"
}