Calculators · Machinery

Machine ownership and operating cost calculator

Knowing what a machine really costs per working hour is the basis for pricing jobs, deciding whether to buy or rent, and comparing machines. These calculators split the cost into ownership — depreciation, interest and insurance, which you pay whether the machine works or not — and operating costs such as fuel, maintenance and the operator. The results are planning estimates in any currency, not financial advice.

Total cost per operating hour

Spreads depreciation over the machine’s life and hours, charges interest and insurance on the average investment, and adds hourly running costs. Using fewer hours per year raises the ownership share sharply.

Results
Ownership cost—per hourDepreciation, interest and insurance per operating hour.
Operating cost—per hourFuel, maintenance and operator per hour.
Total cost—per hourWhat each working hour really costs.

Formula
depreciation/h = (price − resale) / (years × hours)
interest/h = (price + resale) / 2 × (rate + insurance) / hours
running/h = fuel × price + maintenance + operator

Buy or rent: break-even hours

Owning costs a fixed amount each year plus a running cost per hour; renting costs a rate per hour. Above the break-even number of hours a year, owning is cheaper. Compare like with like — rental rates usually exclude fuel and operator.

Results
Break-even use—hours/yearAbove this, buying is cheaper than renting.

Formula
break-even hours = fixed cost / ((rental + rental running) − owner running)

Remaining value by hours used

Estimates a machine’s book value from its hour meter, assuming value falls in a straight line with hours from purchase price to residual value. Used-machine buyers often value machinery on hours rather than age.

Results
Estimated value—currencyStraight-line value at the current hours.
Depreciation per hour—per hourValue lost per operating hour.

Formula
value = price − (price − residual) × hours used / life hours

Worked example: a 200,000 excavator

  1. Bought for 200,000, sold after 5 years at 30%: depreciation is 140,000 / 7,500 h = 18.67 per hour.
  2. Interest and insurance at 7.5% on an average investment of 130,000 add 9,750 a year, or 6.50 per hour.
  3. Fuel (18 L/h × 1.50), maintenance and operator add 74 per hour — about 99 per hour in total.
  4. Against a rental of 75 per hour plus 27 fuel, owning pays off above about 600 hours a year.

Typical useful life in operating hours

MachineUseful life
Compact excavatorabout 6,000 – 8,000 h
Mid-size excavator (20 t)about 10,000 – 12,000 h
Wheel loaderabout 10,000 – 15,000 h
Agricultural tractorabout 12,000 – 16,000 h
Articulated dump truckabout 15,000 – 20,000 h

Related

Excavator and loader productivity calculatorCar total cost of ownership and depreciation calculatorField capacity, work time and tractor power calculatorMachinery specifications

About these results

Results are theoretical estimates from standard engineering formulas. Real-world figures depend on conditions these formulas do not capture. Always follow the manufacturer's specifications for maintenance, loading and safety decisions.

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