Equipment cost per hour is the total of owning costs, operating costs, and business overhead — calculated per hour of machine use. TRUEHOUR applies the industry-standard USACE method to calculate this number for any piece of construction equipment so contractors and owner-operators can price every job with confidence.
Based on the industry-standard method used by the U.S. Army Corps of Engineers and adopted across professional construction organizations. If you're not using the full method, your hourly rate is incomplete.
$20/hr off = $800/week = $40,000+/year. This often happens without being obvious. Common causes: overhead not fully allocated, utilization overestimated, ownership costs simplified, rates based on market instead of full cost.
The correct calculation includes three pillars:
This framework is established by the U.S. Army Corps of Engineers and used across professional construction organizations including Caterpillar.
No spreadsheets. No missed components. No guesswork. The same methodology used by major contractors — simplified into an app. Available on iOS and Android. Free to download with no credit card required.
Equipment cost per hour is calculated by combining three categories: owning costs (depreciation, financing, insurance, taxes), operating costs (fuel, maintenance, repairs, wear items), and overhead allocation (shop, admin, compliance). TRUEHOUR walks you through each category using the industry-standard methodology established by the U.S. Army Corps of Engineers.
Owning costs are the expenses you incur simply by possessing the equipment — depreciation, insurance, financing, and taxes. Operating costs are incurred when the machine runs — fuel, oil, filters, tires, undercarriage, and repairs. Together they form the O&O cost, the baseline number every contractor needs to know before setting an hourly rate.
The U.S. Army Corps of Engineers (USACE) publishes the Equipment Ownership and Operating Expense Schedule (EP 1110-1-8), which has been the professional standard for construction equipment costing for over 70 years. TRUEHOUR applies this same methodology in a mobile app.
Contractors should start by calculating their full equipment cost per hour — including owning, operating, and overhead costs. This gives you a break-even number. From there, you add your desired profit margin. Setting rates based on 'what the market charges' without knowing your actual cost is the most common cause of underpricing in the industry.