Shop rates and MX

people complain about hourly rates, but how about the overhead costs the A&P, IA has? why does the airport get a pass on tripling rents?
 
The one thing missing here is context to what drives each maintenance provider market. The big one is the Part 91 recreational market will never support the wages, and more importantly, the benefit packages the commercial side can offer. For example, on the wage side, the top-out figures I saw for 2025 put mechanics working at the 121 level topped out at $64 to $75 per hour in about 5-7 years depending on company. I think it was FEDEX or UPS at the top. At the Part 135 level it was $45-$65 top out over a longer period. With the Part 91 level at $25-$50. However, these figures do not include any COL adjustments, premium stipends like Lead pay, etc.

However, one of the detractors to chasing the 135/121 pay and benefits is 90% of the time you must move which a number of people do not what to do, so that smaller base is usually what the local mx providers pull from. At my old day job years ago, we were running 30-40 A&Ps per month through the company who only stayed to get their "6 months" of experience so they could get a job closer to home. Unfortunately, a lot has changed since the 80s-90s, so most do not move back now and with the slow decline in Part 91 mx providers since then that large talent pool no longer exists.

So while the consensus appears that a $75 wage or $200 shop rate would correct the mx provider situation at the Part 91 recreational level, in the big picture it unfortunately does not except maybe in a few unique locations. As I stated a few years ago, Part 91 mx will end up being closer to a boutique market model, so perhaps that should be one path to follow for owners wherever possible, as mechanics retire and shops close??
 
Lindberg said:
Tell me where you find these magical employees who do eight hours of customer-billable work every single weekday of the year without rest and don't expect a raise when you increase your rates.
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My original post? The shop is booked out 1 year. Even if you start with an assumption that there are only 1500 'billable' hours all that does is show that you need to increase the hourly rate MORE as you now have less hours to bill.

When I worked distribution the engineers said that an average worker-bee can move X cube an hour factoring in travel, breaks, prep, etc. That cube # was our basis for how much work we could allocate. Over 70% of the worker-bee's made 110% of performance (and got a bonus). So yes, workers can and do do more than expected.

I highly doubt that most shops are run that well (time allocation wise). And as always the best estimate is just that... a guess.
 
Bell206 said:
The one thing missing here is context to what drives each maintenance provider market. The big one is the Part 91 recreational market will never support the wages, and more importantly, the benefit packages the commercial side can offer. For example, on the wage side, the top-out figures I saw for 2025 put mechanics working at the 121 level topped out at $64 to $75 per hour in about 5-7 years depending on company. I think it was FEDEX or UPS at the top. At the Part 135 level it was $45-$65 top out over a longer period. With the Part 91 level at $25-$50. However, these figures do not include any COL adjustments, premium stipends like Lead pay, etc.

However, one of the detractors to chasing the 135/121 pay and benefits is 90% of the time you must move which a number of people do not what to do, so that smaller base is usually what the local mx providers pull from. At my old day job years ago, we were running 30-40 A&Ps per month through the company who only stayed to get their "6 months" of experience so they could get a job closer to home. Unfortunately, a lot has changed since the 80s-90s, so most do not move back now and with the slow decline in Part 91 mx providers since then that large talent pool no longer exists.

So while the consensus appears that a $75 wage or $200 shop rate would correct the mx provider situation at the Part 91 recreational level, in the big picture it unfortunately does not except maybe in a few unique locations. As I stated a few years ago, Part 91 mx will end up being closer to a boutique market model, so perhaps that should be one path to follow for owners wherever possible, as mechanics retire and shops close??
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Its the scale that matters, not the hourly rate. Last night I worked with another MX on 2 AC. So my 'work hours' was about 3 (yes, it was an easy night) for a total man hours of 6. But the result of my labor meant that two full commercial aircraft full of paying customers (225 ppls times say $550 ticket price) grossed $123,750 * 2 or just shy of a quarter million dollars. So my 'shop rate' was ($247,500 / 6 ) $41,250. Now multiply that by 20 (other teams working multiple airplanes).

That's how 121's can pay $65+/hr

Bob Airplane Fix-O-Rama has a staff of 1? 2? 3? and bills a meager $120. So even if all 3 are wrenching for 8 hours that not a lot of gross revenue. Bob can't just throw MX at his revenue issue as there are hard limits like hangar space, cash reserves for supplies and general overhead. The only real way Bob can increase revenue is to up the hourly rate. So instead of grossing $360/hr he bumps the rate to say $160 and those same workers are now grossing $480/hr. And pay can go up from $20 to $25/hr and his labor expense only increased $15/hr.
 
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Pugs said:
A shop out of CT (New England Aero Services) just bought the main side of our local FBO. I just got the bill yesterday for an oil change for the club Archer. $453.97 :oops: That's over $100 more than what the previous owners were charging. Filter price markup 25%, oil markup 50%, charged 2 hours at $130. Well, we're done with that. I'd prefer to do the changes ourselves but the club doesn't want to but another owner in our hangar row is an A&P (who flies his Mooney to work elsewhere) and says he'll do it for $200 including the filter with us providing the oil. We're going to be clear with the new owners why we're leaving.

So, we're now going to shop our annuals as well, unless they understand that NH is not CT and we'll not put up with such. Any shops folks like in the NH, ME, VT, MA area for annuals?
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You might want to be thoughtful and understanding. If that's the only MX at the field, you may need them sometime for AOG.
 
pfarber said:
But the result of my labor meant that two full commercial aircraft full of paying customers (225 ppls times say $550 ticket price) grossed $123,750 * 2 or just shy of a quarter million dollars. So my 'shop rate' was ($247,500 / 6 ) $41,250. Now multiply that by 20 (other teams working multiple airplanes).
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On what planet does that make sense?
 
pfarber said:
So my 'shop rate' was ($247,500 / 6 ) $41,250. Now multiply that by 20 (other teams working multiple airplanes).
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interesting. Do you also include the revenue they made from those same pax from baggage fees and credit card transactions into your shop rate? So you actually believe they expense out that $41k shop rate when calculating their bottom-line? I think its fair to state your airline is happier that you work on the aircraft and not in accounting...;)

pfarber said:
The only real way Bob can increase revenue is to up the hourly rate. So instead of grossing $360/hr he bumps the rate to say $160
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Again, interesting. So you have used this business model when providing aircraft mx services to customers? And while we're here, what target net profit are you looking at for the increase to $160/hr?
 
Pugs, I'm not defending NEAS, but consider the following.

Oil is about $100-$110 per case, dependent on what you want. Add $25 per case for shipping, that easily makes it $10/qt. Granted with most suppliers, purchase at least 4 cases (over $400) and shipping is free. Add cost of oil filter, about $40 retail, plus shipping. Remember any "shop markup" needs to cover shipping cost and overhead. Someone had to sit at a desk, place the order, process the order when received and ensure the accounting goes to the correct project. I would agree that 50% markup is high. Shop rates in the area are currently $135-$150 per hour. So for your oil change, 10qts of oil at $120 with shipping, oil filter at $40+shipping, 2hrs labor at $140, that's already at $440. Then there is the disposal fee to discard the old oil. The $453.97 charge seems pretty close to about right.

Ever consider that the previous owners were undercharging and not making $$ to stay in business, so they sold the business while they could? I do not know the details of the previous owner, aging out, wanting to move south. So many probable reasons.

I know one shop in Nashua is $140/hr. I also know most shops have more work available than hours in a week to complete it and its hard to find aircraft mechanics.

If you can find a place locally to purchase aircraft oil by the case, please let me know. Otherwise it's 4 cases at a time to get free shipping from $Aircraft$pruce$.
I had a distributor in Las Vegas that I could just go to the warehouse, but cannot find one in New England.

We just had to purchase 2 sheet metal parts from Europe. The factory would not deal with us, we had to use their "US Representative". Their "agent" tacked on a 30% Commission for ordering and handling the parts that were shipped to him, on top of the tariff, plus the cost of shipping from his FL location to us in NH.
 
I don’t begrudge a shop making the $140 per hour. But, when they decide to go up $10-15 per hour a year, well, I think that is above the inflation rate of 2-3% per year. Do the mechanics deserve a pay raise yes, but I wonder if the shops pass their increases on to the AnPs. The old theory of supply and demand will eventually take hold. Demand will drop as pilots age out or are priced out, this will probably keep pace with the drop in supply, so in the end, GA will either die or things will even out the supply and demand, along with pricing.
 
BillTIZ said:
Pugs, I'm not defending NEAS, but consider the following.

Oil is about $100-$110 per case, dependent on what you want. Add $25 per case for shipping, that easily makes it $10/qt. Granted with most suppliers, purchase at least 4 cases (over $400) and shipping is free. Add cost of oil filter, about $40 retail, plus shipping. Remember any "shop markup" needs to cover shipping cost and overhead. Someone had to sit at a desk, place the order, process the order when received and ensure the accounting goes to the correct project. I would agree that 50% markup is high. Shop rates in the area are currently $135-$150 per hour. So for your oil change, 10qts of oil at $120 with shipping, oil filter at $40+shipping, 2hrs labor at $140, that's already at $440. Then there is the disposal fee to discard the old oil. The $453.97 charge seems pretty close to about right.

Ever consider that the previous owners were undercharging and not making $$ to stay in business, so they sold the business while they could? I do not know the details of the previous owner, aging out, wanting to move south. So many probable reasons.

I know one shop in Nashua is $140/hr. I also know most shops have more work available than hours in a week to complete it and its hard to find aircraft mechanics.

If you can find a place locally to purchase aircraft oil by the case, please let me know. Otherwise it's 4 cases at a time to get free shipping from $Aircraft$pruce$.
I had a distributor in Las Vegas that I could just go to the warehouse, but cannot find one in New England.

We just had to purchase 2 sheet metal parts from Europe. The factory would not deal with us, we had to use their "US Representative". Their "agent" tacked on a 30% Commission for ordering and handling the parts that were shipped to him, on top of the tariff, plus the cost of shipping from his FL location to us in NH.
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I fully understand the logic and economics you're putting out but NEAS bought the business from Emerson and are using the same people and the same facilities, and one would assume at least some of the same supplies so seeing an oil change go from $350 to $450 in a month doesn't tell me the issue is costs. Since NEAS has two other facilities, you would also think they could do the larger buys of materials and get decent deals.
 
Pugs said:
I fully understand the logic and economics you're putting out but NEAS bought the business from Emerson and are using the same people and the same facilities, and one would assume at least some of the same supplies so seeing an oil change go from $350 to $450 in a month doesn't tell me the issue is costs. Since NEAS has two other facilities, you would also think they could do the larger buys of materials and get decent deals.
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Does NEAS provide the same identical services as Emerson did? Or do they provide a much wider variety of services across more types of aircraft?
 
Pugs said:
I fully understand the logic and economics you're putting out but NEAS bought the business from Emerson and are using the same people and the same facilities, and one would assume at least some of the same supplies so seeing an oil change go from $350 to $450 in a month doesn't tell me the issue is costs. Since NEAS has two other facilities, you would also think they could do the larger buys of materials and get decent deals.
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There's one other scenario, the previous owner sold because they were losing money and the new owner revised pricing to make money. You clearly don't have to patronize the new owner, but I don't see how they were making much money at $350 based on the math previously shown.
 
Bell206 said:
Does NEAS provide the same identical services as Emerson did? Or do they provide a much wider variety of services across more types of aircraft?
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https://newengland.aero/ Wider range of services. I understand they wanted the new facility because of the large hangar to work on Caravans. The word is the previous owner sold as a transition to retirement. He kept the flight training part.
 
the car dealer thing doesn’t work for most aircraft stuff, of that 200 how much does the guy turning the wrench get?

My IA get 100% of his rate and it’s cash.
 
Pugs said:
A shop out of CT (New England Aero Services) just bought the main side of our local FBO. I just got the bill yesterday for an oil change for the club Archer. $453.97 :oops: That's over $100 more than what the previous owners were charging. Filter price markup 25%, oil markup 50%, charged 2 hours at $130. Well, we're done with that. I'd prefer to do the changes ourselves but the club doesn't want to but another owner in our hangar row is an A&P (who flies his Mooney to work elsewhere) and says he'll do it for $200 including the filter with us providing the oil. We're going to be clear with the new owners why we're leaving.

So, we're now going to shop our annuals as well, unless they understand that NH is not CT and we'll not put up with such. Any shops folks like in the NH, ME, VT, MA area for annuals?
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On a archer?

Can I change your oil??!

Please tell me it didn’t have a spin off oil filter or a quick drain and the oil plug are cross threaded as was the oil screen filter, and they it took exotic oil that was delivered my unicycle carrier who held 3 PHDs ;)
 
Pugs said:
https://newengland.aero/ Wider range of services. I understand they wanted the new facility because of the large hangar to work on Caravans. The word is the previous owner sold as a transition to retirement. He kept the flight training part.
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The fact they work turbines, jets, heavy engine work, and major structural will easily account for the $100 increase as the rates and parts prices are set by the overall business structure than the specific job. So the comparison to the previous operator is basically unfounded. For example, if I had retained major engine work and structural repair my rates would have gone up 15% just to cover the additional insurance coverage let alone all the investment required to maintain such levels of service.

As I had mentioned in this thread or another, theres been a shift in the market toward this higher level of service and away from previous types you saw. Be thankful Signature didnt buy this place as they've been known to drop all private recip mx services, so there wouldnt even have been the higher cost option you mentioned earlier. Unfortunately, as shown here, a shop raising their rates is not a solution in most Part 91 markets as owners will not accept it regardless the reason and look elsewhere.
 
I have an A&P who's still billing at $80/hr... I talked to him about it once and he basically said he thinks if he raised his rates a lot of local pilots would just sell their planes and quit flying. I'm not sure about that, I almost wish he would raise it a little bit because I want him to stay around.
 
cowman said:
he thinks if he raised his rates a lot of local pilots would just sell their planes and quit flying. I'm not sure about that,
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Unfortunately that has been the sentiment at a number of small mx shops for 15 years or so. And I've personally seen it happen in different forms.

cowman said:
I almost wish he would raise it a little bit because I want him to stay around.
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Then dont wish and become more proactive. Go talk to him and your fellow owners at the airport and see where everyone is at and for how long. You may just surprise yourself and him. Wishing and hoping doesnt make the problem go away, and if done correctly might just help all concerned come up with a doable solution.
 
cowman said:
I have an A&P who's still billing at $80/hr... I talked to him about it once and he basically said he thinks if he raised his rates a lot of local pilots would just sell their planes and quit flying. I'm not sure about that, I almost wish he would raise it a little bit because I want him to stay around.
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anything stopping you from paying him more than he billed you for?

(not being snarky or snippy, just asking)
 
Bob Noel said:
anything stopping you from paying him more than he billed you for?

(not being snarky or snippy, just asking)
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Honestly while I knew he was on the cheaper side I don't think I realized by how much until I started listening to the podcast OP is mentioning. Haven't really had a new bill to pay recently either, it's something to think about for the next annual.
 
cowman said:
I have an A&P who's still billing at $80/hr... I talked to him about it once and he basically said he thinks if he raised his rates a lot of local pilots would just sell their planes and quit flying. I'm not sure about that, I almost wish he would raise it a little bit because I want him to stay around.
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Over pay. Get priority when something pops up
 
cowman said:
I have an A&P who's still billing at $80/hr... I talked to him about it once and he basically said he thinks if he raised his rates a lot of local pilots would just sell their planes and quit flying. I'm not sure about that, I almost wish he would raise it a little bit because I want him to stay around.
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Let me guess: this is the guy the FAA calls when they're surveying shops to come up with their near-mythical $85/hr rate for ADs, right? :D
 
AvNavCom said:
Let me guess: this is the guy the FAA calls when they're surveying shops to come up with their near-mythical $85/hr rate for ADs, right? :D
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Ha. But in a way yes. However, its the Bureau of Labor that would do the calling as they provide $85 figure to the FAA based on a national A-Z average. You'll see this explained at times during the AD NPRM phase when the public comments question that cost.
 
Bell206 said:
Ha. But in a way yes. However, its the Bureau of Labor that would do the calling as they provide $85 figure to the FAA based on a national A-Z average. You'll see this explained at times during the AD NPRM phase when the public comments question that cost.
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I wonder if the Bureau of Labor has done a survey since 1995? I have a hard time believing that the average is still anywhere near $85, since that would imply that all the shops charging $120-130/hr are balanced out by shops charging $50/hr.

Since I learned yesterday that it is apparently not customary to pay flight instructors, perhaps it is also not customary to pay A&Ps for their work? There's a cohort of A&Ps doing it for the love of wrenching, getting $0/hr, and skewing the mean? :D
 
AvNavCom said:
I wonder if the Bureau of Labor has done a survey since 1995?
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The BLS updates its statistics yearly, but that AD figure is only labor/hr cost and does not include things like incidental costs or indirect costs which would be impossible to average out on the national level. But what it actually shows is the mx labor only rate has been stagnate for a number of years. It’s the other business costs that have gone up. For example, my labor only rate has remained $75/hr for at least 12 years but I no longer any overhead. So when you average out those specific hourly labor costs across the country its $85.
 
Bell206 said:
The BLS updates its statistics yearly, but that AD figure is only labor/hr cost and does not include things like incidental costs or indirect costs which would be impossible to average out on the national level. But what it actually shows is the mx labor only rate has been stagnate for a number of years. It’s the other business costs that have gone up. For example, my labor only rate has remained $75/hr for at least 12 years but I no longer any overhead. So when you average out those specific hourly labor costs across the country its $85.
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Interesting. I'll bow to your superior knowledge on the subject, of course. I was under the impression that the FAA AD estimates are supposed to represent the cost to an owner to get the AD done, which in my experience at least has never come close to $85/hr as the guy writing the check. Seems somewhat disingenuous of the FAA to say "we estimate it's going to cost X dollars" when the reality is that it is more like X(labor) + 0.5X(overhead).
 
This conversation is going to see mx shops nationwide install POS terminals that include a suggested tip of 20% :)
 
Had a good conversation today with the owner of the shop. He admitted that it looks like they made 1/2 hour mistake between time card and invoicing and will re-invoice but that he is not going to have a mechanics helper rate just one as his timekeeping system won't do that so any work will be billed at his $130 A&P rate. The markup on parts wasn't discussed. So, off to do our own oil changes or the gent behind our hangar is finishing up his IA so is will do do owner assisted annuals for us. Whatever we have to do to keep things affordable. I'm sure we'll still use our local shops for some stuff.
 
My gripe is less with the rate per hour, and much more with the work product Im getting. Four hours labor for replacing the disc brake pads? I have done it in two and that includes drilling and riveting. Wrench left inside right wing root cover. Wrong screws used in inspection panel. Cable tension measurement set wrong. Food leftover in cockpit stinking it up.

If I am going to pay top tier labor, I dont want some trainee messing things up while the licensed guy looks in once in a while. People used to pay me a great deal of money to come get their systems out of a messy jam. And, they got ME, not some snotty tatted up douche nozzle with his pants around his thigh.

Same with my boat 'diesel mechanic'. He want $160 per hour. So I show up one day and there is some little 20YO Richard Cranium in my engine room with a PIPE WRENCH! trying to get a brass fitting off the engine. End of that service provider. So, raise rates, but get the guy with some gray hair and actual license in there to do a two hour job well in two hours. Happy to pay and not have to do the job over twice.
 
AvNavCom said:
I was under the impression that the FAA AD estimates are supposed to represent the cost to an owner to get the AD done, which in my experience at least has never come close to $85/hr as the guy writing the check.
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Keep in mind the cost of compliance data is a requirement of the APA act and not the FAA. Below is one example concerning an AD to replace the handheld fire extinguisher in certain helicopters. It uses the average $85 base rate but only shows a .25 work-hour to perform the task at $21. And since that base rate can fluctuate between $25 to $105+ the actual cost could range from $6 to $26. However, in the real world nobody will charge you for only a .25 hr of work. For example, I would charge you $150 as I have a 2 hour minimum and if I'm not back home in 2 hours then additional travel time to comply with the AD. So that printed AD cost was always just an estimate on a specific task to comply with the APA requirements.

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Dan Thomas said:
On what planet does that make sense?
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Do the math and tell my why it doesn't show a proper example of economy of scale in a general way.

also EARTH

If you have more workers billing more customers at a higher rate you make more money. Do I need to draw a MS PAINT flowchart on this?
 
Rcmutz said:
I don’t begrudge a shop making the $140 per hour. But, when they decide to go up $10-15 per hour a year, well, I think that is above the inflation rate of 2-3% per year
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Um, due to the previous administration INFLATION IS UP 20%. So your generous offer of 2% is just gonna put shops out of business.

There is a reason a Big Mac meal at BK used to be $6 and now is $13. For all those reasons and more this is a perfect example of why shops need to raise rates to:

1. Attract GA mechanics that are worth paying
2. Invest in their business
3. Survive
 
decalogue said:
the car dealer thing doesn’t work for most aircraft stuff, of that 200 how much does the guy turning the wrench get?

My IA get 100% of his rate and it’s cash.
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Ask you IA about his expenses:

Insurance ($6k to start is not unreasonable)
taxes / health insurance / 401k
Tools / calibration
AD software (he could hard core it and use the FAA web site but I would not use an IA that does)
sundries like shop towel, oil dry, gloves, hand cleaner, PPE

IAs do have a much more lucrative cash stream and can see a higher net profit but its not all going right into their pocket.... I wish it was.

I work with quite a few guys that started with GA, same story, interesting work, great hours, garbage pay. Me? I'll take my airline pay and bennies and work service checks and MELs for the next decade or two.
 
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