Equipment cost per hour calculator
What a machine costs for every hour it works: depreciation, financing, insurance, fuel, maintenance and the operator, divided by the hours it runs in a year.
Your numbers
OwningOperatingUseResult
Cost per hour $63.39 Owning per year $41,867depreciation $26,667 + interest $10,200 + insurance $5,000 Operating per year $34,200 Owning per hour / operating per hour $34.89 / $28.50The formula
Cost per hour = (Owning cost per year + Operating cost per year) ÷ Operating hours per year
Depreciation is (price − resale) ÷ years; interest is charged on the average investment, (price + resale) ÷ 2, a common estimating method. The cost per hour guide walks through each line and the mistakes that skew it.
Using the numberWhat to do with it
- Compare it with what renting the same machine costs per hour you’d actually use it. Low hours per year push the owning share up fast.
- Use it to price jobs and internal charge-out rates, and update it once a year with real maintenance cost from your records.
- Watch the operating share climb as the machine ages: that trend, not the age alone, is the signal to replace.
Guides behind this calculator
Heavy equipment cost per hour Equipment lifecycle costFleetZap Maintenance Pro (full CMMS)
Everything a maintenance team needs in one place: work orders and PM plus a parts store with purchasing, compliance and certificate tracking, multi-location assets with a full lifecycle, and the KPIs that prove it’s working.
- Parts & purchasing
- Compliance
- Assets & lifecycle
- Reports & KPIs
Good to know
How do you calculate equipment cost per hour?Add the yearly cost of owning the machine (depreciation, interest, insurance and taxes) to the yearly cost of running it (fuel, maintenance, repairs, wear parts and, if you include it, the operator), then divide by the hours it works in a year.
How is depreciation worked out per year?A simple way is purchase price minus expected resale value, divided by the years you keep the machine. A $250,000 machine sold for $90,000 after 6 years depreciates about $26,667 a year.
Why does cost per hour go up when a machine is used less?Most owning costs are fixed per year. Spread over fewer hours, each hour carries more of them, which is why low-use machines are often cheaper to rent than to own.
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