Guide
Setting a club rate that actually covers the aeroplane
A club rate is not a price, it is a forecast. Get it wrong and nobody notices for two years, until the engine is due and the account has three thousand dollars in it.
Wet or dry, first
Wet means the hourly rate includes fuel. The member flies, the club buys the fuel, and the rate has to carry it. Dry means the member buys fuel themselves and the rate covers everything else.
Wet is simpler for members and makes the cost of a trip predictable. It also means the club carries fuel price risk, which in a year like the last few is a real risk. Dry pushes that risk to the member and makes fuel receipts a permanent administrative job, since somebody has to credit the member who filled up away from base.
Most clubs run wet, and handle away-from-base fuel as a credit against the member’s account. That is the model FlightWay assumes by default: a receipt photographed on the ramp becomes either a club expense or a credit to the member who paid. How receipts post.
The two buckets
Every cost the aeroplane generates lands in one of two buckets, and the decision that follows is which bucket dues cover and which the hourly rate covers.
Fixed, whether it flies or not
Insurance, hangar or tie-down, annual inspection labour, registration, database and software subscriptions, the accountant. These do not care about hours.
Variable, per hour flown
Fuel, oil, engine and prop reserves, tyres and brakes, unscheduled maintenance, the parts of the annual driven by wear.
The classic club structure covers fixed costs from monthly dues and variable costs from the hourly rate. Push more into dues and flying gets cheap, which encourages utilisation but charges the member who flies twice a year the same as the one who flies weekly. Push more into the rate and it is fairer per flight, but a quiet winter leaves the fixed costs uncovered. Clubs argue about this endlessly. There is no correct answer, only a decision your members should understand.
Building the hourly number
Work in dollars per hour, and be explicit that these figures are an example rather than current prices for your aeroplane. Replace every line with your own numbers.
| Line | How it is worked out | Example, per hour |
|---|---|---|
| Fuel | 9.0 gph at $6.50 a gallon | $58.50 |
| Oil and top-ups | Consumption plus changes, spread over the interval | $3.00 |
| Engine reserve | $35,000 overhaul divided by 2,000 hour TBO | $17.50 |
| Propeller reserve | $3,000 overhaul divided by 2,000 hours | $1.50 |
| Unscheduled maintenance | Last three years of actual spend, divided by hours flown | $18.00 |
| Tyres, brakes, consumables | Actual, divided by hours flown | $4.00 |
| Avionics and instrument reserve | Replacement over expected life | $3.00 |
| Variable subtotal | $105.50 | |
| Contingency | 10%, because the estimate is a forecast | $10.55 |
| Wet rate, before fixed costs | $116.05 |
If the club also recovers part of its fixed costs by the hour rather than through dues, add fixed costs divided by forecast annual hours, and be honest about that forecast.
The forecast that breaks clubs
Fixed costs divided by hours flown is the line that punishes optimism. A club that assumes 300 hours a year and flies 180 has under-recovered its insurance and hangar by 40%, and the shortfall is invisible until it is a reserve that is not there.
Two defences. First, cover fixed costs from dues, which do not care how much anyone flew. Second, look at actual hours against forecast every quarter, not every year, so a bad winter is a conversation in March rather than a discovery in December.
Reserves have to be real money
An engine reserve that exists only as a line in the rate is not a reserve. If it is not visible as an account with a balance, it is being spent on hangar rent by accident.
In a proper set of books, the reserve is an account, the hourly accrual is a journal entry into it, and the overhaul draws it down. That is one of the practical reasons FlightWay keeps a double-entry ledger rather than a billing table: a club can see what it has set aside and what it has quietly consumed. How the books work.
When to revisit
- Every year, deliberately, with the actual cost per hour from the last twelve months in front of you.
- Whenever fuel moves more than about 10%, if you are wet.
- After any large unscheduled event, because it changes the unscheduled maintenance line.
- Before, not after, the engine reaches TBO.
The number to check against is simple: what each aeroplane earned and what it cost over the same period. A club that can produce that per aircraft, from the same records that billed the flights, can set rates from evidence rather than from the last committee’s instinct.
Last updated 18 August 2026.