Wendover’s $10 Airline Profit Is Built on a Full Plane and a Corporate-Jet Cost Sheet
Wendover Productions promises to explain why an $80 airline ticket costs so much. Its conclusion is remarkably precise: approximately $70 pays for the flight, leaving the airline with $10 in profit.
There is a serious problem with that calculation. Several of its largest expenses are not established commercial-airline costs. They are borrowed from a different type of aircraft, estimated using questionable assumptions, or simply guessed.
The creator does acknowledge that the numbers are rough estimates and that the calculation assumes every seat is occupied. That qualification matters. But acknowledging uncertainty does not turn an illustrative calculation into a reliable account of airline profitability.
The $10 profit figure is the weakest part of the entire presentation.
The maintenance bill comes from a corporate jet
The most revealing problem is hiding in the video's maintenance figures.
Wendover assigns a one-hour flight four maintenance expenses:
- $646 in maintenance labor.
- $276 in parts.
- $603 in inspections and component overhauls.
- $596 in engine restoration.
The total is $2,121, or approximately $14 per passenger.
These figures are not independent estimates of what an airline spends maintaining an A320neo. They match the figures in a June/July 2012 Business Jet Traveler cost sheet for a 2002 Airbus ACJ320.
The source identifies the maintenance figures as hourly direct operating costs and attributes its cost data to Conklin & de Decker. Its annual operating budget assumes 438 flight hours and 175,000 nautical miles.
The distinction matters. An ACJ320 is an Airbus Corporate Jet, designed for private and executive aviation. It is not the same operating proposition as an A320neo carrying 154 paying passengers on scheduled commercial services.
The difference is independently confirmed by AOPA's October 2016 publication of Conklin & de Decker aircraft operating costs. It classifies the ACJ320 as an ultra-long-range, large-cabin business jet, lists 19 executive seats and identifies its engines as CFM56-5B4s.
Sources: Business Jet Traveler's A320 cost sheet and AOPA's aircraft operating-cost comparison.
Wendover transfers the corporate-jet maintenance figures into its commercial-airline calculation without establishing that they represent the costs of operating the aircraft it describes.
The ACJ320 shares its underlying aircraft family with the commercial A320. That does not make its maintenance assumptions interchangeable with those of an A320neo airline operation.
Different engine configurations, maintenance programmes and operating patterns matter. A cost estimate from one operating environment cannot simply be presented as the cost of another.
The video gives viewers four precise maintenance figures. What it does not give them is evidence that those figures describe the commercial flight being modelled.
Dulles was not charging JFK prices
The airport calculation contains another avoidable problem.
Wendover calculates JFK's departure charge using $6.33 per 1,000 pounds of aircraft weight. It then estimates Washington Dulles's landing charge at approximately $1,005, acknowledging that it does not have the airport's published fee.
The narrator explains:
"we’ll assume it’s about the same as JFK’s landing fees"
That assumption materially affects the calculation.
A subsequent Metropolitan Washington Airports Authority financial disclosure, dated June 14, 2016, reported that Dulles's 2015 landing fee for signatory airlines was $2.93 per 1,000 pounds, down from $3.86 in 2014.
Applying that documented 2015 rate to the video's 170,000-pound landing weight produces approximately $498, rather than $1,005.
That is a difference of approximately $507 per flight, or $3.29 per passenger across 154 seats.
The disclosure came after the video was published, so it does not establish that the creator ignored information already available. It does establish that assuming Dulles charged approximately the same as JFK was not a reliable basis for the calculation.
There is another distinction worth making. The Airports Authority reports airline rents, landing fees, passenger conveyance charges and international-arrival fees as separate revenue categories. A weight-based landing fee is not an all-inclusive payment for gates, terminals and other airport services.
The video's airport calculation therefore combines an assumed landing fee with an incomplete explanation of what airport charges actually cover.
The full plane does most of the accounting
Wendover divides almost every major flight expense by 154 passengers.
That is the aircraft's assumed passenger capacity, not an independently established passenger count.
The video eventually admits this:
"it’s all assuming a fully loaded airplane."
This is an important qualification, but it is also the foundation of the claimed $10 profit.
The Bureau of Transportation Statistics reported that U.S. domestic scheduled airlines had an average passenger load factor of 84.6% in 2016. Load factor measures occupied passenger capacity against available seat capacity.
Applying that percentage as a rough occupancy proxy to the video's 154-seat aircraft gives approximately 130 passengers, not 154.
Consider the expenses that the video allocates across the entire aircraft:
Expense Cost per flight Crew $240 Airport charges $2,094 Aircraft purchase allocation $1,783 Maintenance $2,121 Insurance $36 Total $6,274At 154 passengers, these expenses amount to approximately $40.74 per person.
At 130 passengers, they amount to approximately $48.16.
That is an increase of $7.42 per passenger, before changing any other assumptions.
The video's $10 profit cushion would consequently shrink to approximately $2.60 under this simple sensitivity test.
This is not a reconstruction of the actual New York–Washington route's passenger numbers. The national load factor is a benchmark, not a route-specific occupancy figure. But it demonstrates how heavily the claimed profit depends on selling every seat.
A plane does not stop paying for its pilots, airport access, aircraft ownership or scheduled maintenance when a seat goes empty.
The creator knows this. He says so himself. Yet the $10 figure is presented as the profit left by the ticket calculation, not as a result that only holds under an unusually favourable occupancy assumption.
The aircraft purchase calculation is not depreciation accounting
Wendover assigns the A320 a purchase price of $107 million and a maximum service life of 60,000 flight cycles.
It divides one by the other to produce an aircraft cost of $1,783 per flight.
The arithmetic is correct. The accounting model is incomplete.
A real airline must account for the aircraft's useful life, expected resale value, age, utilization and acquisition cost.
Southwest Airlines' 2015 Form 10-K provides a useful example of actual airline accounting.
The company reported estimated useful lives of 23–25 years for airframes and engines, with expected residual values of 2–20% of their original cost. It also explained that aircraft life estimates incorporate flight cycles and aircraft age, converted into years using historical and anticipated utilization.
Southwest further disclosed that these estimates can change as maintenance programmes, utilization and used-aircraft market prices change.
Source: Southwest Airlines, 2015 Form 10-K, February 3, 2016.
This does not mean Wendover's $1,783 allocation is necessarily wildly inaccurate. It means that dividing an assumed purchase price by a maximum cycle count is not the same as calculating an airline's actual aircraft depreciation expense.
The video never establishes the actual transaction price paid by an airline, the residual value, the financing arrangement or the relevant accounting life.
It presents a simplified allocation as though it were an established operating cost.
A guessed overhead expense cannot establish profit
The most important admission comes when the video reaches airline administration.
The narrator lists executives, administrators, software engineers, marketers, consultants, customer service personnel, public-relations staff, janitors, rent, benefits, travel and utilities.
Then comes the explanation:
"it’s hard to put an exact number on how much per person this works out to"
The solution is to allocate $10 per passenger.
No airline financial statement, cost allocation or calculation is supplied to establish that figure.
This matters because the overhead estimate directly affects the final profit calculation.
The Bureau of Transportation Statistics reported that U.S. scheduled passenger airlines recorded $49.7 billion in labour expenses in 2016, representing 34.7% of operating expenses. Fuel accounted for $22.4 billion, or 15.6%.
Airline labour is not simply the salary of the two pilots and four flight attendants on a particular aircraft. It includes the much wider workforce required to operate an airline.
The video's $10 allocation is supposed to cover a substantial collection of those costs, but its methodology is never explained.
Source: BTS, 2016 Annual and 4th Quarter Airline Financial Data.
The final profit claim has an even more fundamental problem: it does not distinguish between operating profit and net profit.
BTS reported that the 25 US scheduled passenger airlines generated $168.2 billion in operating revenue in 2016, against $143.3 billion in operating expenses.
Their combined operating profit was $24.8 billion, while their after-tax net profit was $13.5 billion.
The distinction is substantial. The industry's 2016 operating margin was 14.8%, while its net margin was 8.1%.
Furthermore, passenger fares accounted for only 74.5% of total operating revenue. Cargo, baggage fees, reservation changes, transport-related services and other activities contributed the rest.
These figures establish that airlines were profitable as an industry. They do not establish that an individual $80 ticket generated exactly $10 in profit.
Airline profitability is measured using the company's complete revenues and expenses. It cannot be reliably reconstructed by subtracting a handful of estimated expenses from one hypothetical ticket.
The video's $10 is an arithmetic remainder, not a measured airline profit.
The driving comparison also favours the airplane
The video also argues that flying from New York to Los Angeles is cheaper than driving.
Its comparison uses a $340 round-trip airfare against $640 in estimated driving costs.
But the driving calculation covers a 40-hour journey from New York to Los Angeles, while the airfare explicitly covers a round trip.
The comparison also treats the car's total cost as though it were a per-person expense, despite previously explaining that a Toyota Camry seats five.
Using the video's own numbers, the $640 driving estimate amounts to $128 per person for a one-way journey with five occupants.
That is not directly comparable with a $340 round-trip airfare per passenger.
Tolls, accommodation and other road expenses would also need to be considered before reaching a complete conclusion. But the original comparison does not do that work.
The conclusion that flying is cheaper for every traveller is therefore not established by the example.
The verdict: An explanation is not an audit
There are important truths in this video.
Fuel is only one component of airline operating expenses. Aircraft maintenance is expensive. Aircraft efficiency has improved. Competition can produce substantial differences in fares between routes.
The problem is not its central educational message.
The problem is the apparent precision of its financial conclusion.
The $70 cost figure combines a corporate-jet maintenance estimate, an assumed Dulles airport charge, a fully occupied aircraft, a simplified aircraft purchase allocation and an unexplained overhead estimate.
The creator acknowledges that the numbers are rough. That is not evidence of deliberate deception, and there is no basis to accuse him of concealing the assumptions.
But a qualification at the end cannot transform an unsupported calculation into a reliable statement of airline profitability.
The $10 profit figure is particularly misleading because it sounds like something an airline's accounts have established.
They have not.
Wendover explains why flying costs more than fuel. It does not establish what an airline actually spends to operate this flight, or what it earns from each passenger.
That distinction is the difference between an entertaining financial illustration and an independently defensible economic analysis.
References
- Why Flying is So Expensive — Wendover Productions, May 10, 2016. The original video and primary source for the $70 cost calculation, $10 profit claim and stated assumptions.
- A320 BJT 0612 — Business Jet Traveler, June/July 2012. The cost sheet containing the exact maintenance figures reused in the video; it identifies the aircraft as a 2002 Airbus ACJ320 and attributes its operating-cost data to Conklin & de Decker.
- Operating Costs of Jets, Turboprops Detailed — AOPA, October 31, 2016. Independently identifies the ACJ320 as a business jet with 19 executive seats and CFM56-5B4 engines.
- Southwest Airlines 2015 Form 10-K, February 3, 2016. Documents actual airline depreciation policies, aircraft residual values and the use of both flight cycles and aircraft age in estimating useful lives.
- Supplement to Official Statement — Metropolitan Washington Airports Authority, June 14, 2016. Records Dulles's 2015 signatory landing fee of $2.93 per 1,000 pounds and distinguishes landing fees from other airport charges.
- 2016 Annual and December U.S. Airline Traffic Data — Bureau of Transportation Statistics, March 16, 2017. Establishes the 84.6% domestic passenger load factor used to test the video's full-capacity assumption.
- 2016 Annual and 4th Quarter Airline Financial Data — Bureau of Transportation Statistics, May 16, 2018. Provides actual airline revenues, expenses, operating and net profits, profit margins, and the contribution of non-fare revenue.
Tighten the opening argumentReconcile the maintenance-aircraft terminology