Rent vs lease vs buy

R 03 mHow it works

H = hours per month × months;  K = call-outs per month × months
Rent, hourly  = K × max(hours per call-out, minimum) × (rate + operator if bare + fuel) + K × mobilization
Rent, monthly = months × monthly rate + H × (operator + fuel) + K × mobilization
Lease = down + payment × min(months, term) + buyout if the term ends in the horizon
        + fixed per year × months ÷ 12 + H × (running + operator)
Buy   = price − resale + interest paid in the horizon
        + fixed per year × months ÷ 12 + H × (running + operator)
Per working hour = total ÷ H

Renting by the hour. Each call-out is billed for its hours or the minimum, whichever is more, so short jobs cost more per working hour than the rate suggests. A bare rate needs an operator on top; an operated rate already includes one. Mobilization is charged per call-out.

Renting by the month. The monthly rate covers the truck; your operator, fuel and mobilization are added.

Leasing. The down payment and the monthly payments for the months inside your horizon, plus the buyout if the term ends within it, plus your fixed and running costs. If the term runs past your horizon, the payments after it are not counted, because the calculator only looks at your horizon; read the lease for what ending early would cost.

Buying. The price less the resale value you expect at the end, plus the interest paid during the horizon on a loan for the full price (standard amortization, monthly payments), plus fixed and running costs. Leave the interest rate empty for a cash purchase.

Breakeven. The tool also finds the monthly hours at which renting and buying cost the same, between 1 and 744 hours a month (every hour of a 31-day month). Both costs rise in a straight line with the hours, except that a call-out minimum keeps the rental bill flat until the minimum is used up, so there can be two crossing points. The result says which side of each costs less.

R 06 mAssumptions and sources

Every figure in the result comes from what you enter. Nothing is pre-filled, because our research found no sourced Canadian purchase or lease prices for boom trucks, and a made-up default would end up in someone's budget. Two reference panels sit under the calculator instead: published hourly rates and operator wages.

Operated and bare are different prices. New Brunswick's rental rates cover ownership, fuel, overhead and profit but exclude operator wages, which are paid separately⁹. Prince Edward Island's are maximum hourly operated rates that include operator wages and fuel, with a 3-hour call-out minimum⁴. Newfoundland and Labrador's schedule is bare, and for operated rentals adds the operator's basic wage plus a 35% burden⁵. Vancouver Island's IEOA rates include the operator but not transportation⁷. Put each quote on the right basis before comparing it.

The operator. If you rent bare, lease or buy, you supply the operator, so enter your burdened cost per hour. For scale only, Job Bank lists a national median wage of $42.77 an hour for boom truck crane operators⁸. That is a wage, not what an operator costs an employer.

What owning adds. Ownership costs are more than the payment. In British Columbia, for example, a mobile crane or boom truck must be inspected at least once every 12 months and certified safe by a professional engineer before use¹⁰. Put inspection, insurance, registration and permits into the fixed cost per year.

R 09 mReading the result

The result gives the total for each option over your horizon and the cost per working hour. The per-hour figure is the fairer comparison when the options carry different extras, such as mobilization on a rental or fixed costs on a purchase. The breakeven line shows how sensitive the answer is to your hours: if your hours are close to it, a small change in workload flips the comparison.

The result names the option that costs least on the numbers you entered. It is arithmetic, not advice. It leaves out things that are real but hard to put a number on: the cash tied up in a purchase, the risk of the truck sitting idle, a supplier's availability in your busy season, and how a lease is treated on your books. Under ASPE, for example, a lessee classifies a lease as a capital lease when ownership is reasonably assured to transfer, the term is usually 75% or more of the asset's economic life, or the present value of the payments is usually 90% or more of its fair value¹¹. See the lease accounting guide and talk to your accountant.