If you missed all the different announcements, I started a new podcast called Extremities about a month ago. It's all about how and why the world's most isolated human settlements exist, with the first season being on Pitcairn--the 50 person British territory in the South Pacific. You can listen to the podcast here: ExtremitiesPodcast.com
Wendover Productions oh I did not miss the announcement, and I LOVE THE PODCAST! Just one request; can you push out like an episode a day? Can’t get enough ;)
Many big corporations have a policy of not allowing multiple upper management people on the same flight, to reduce the hit in case of an accident. A friend in upper management at Snap-On Tools says it's the policy there. A 1993 corporate jet crash took out the president and upper management of In N Out Burger, and almost sunk the company.
Can't believe how far I had to scroll to see this point. I used to run a data management system for a corporate travel agency, and one of the reports you could do was to see if x number of execs were booked on the same flight. Just like you said, companies generally want to avoid clumping a bunch of execs on the same flight.
There was a real estate firm interested in purchasing a mall near me. On final approach to the airport, the jet went down killing everyone on board. The two owners and five other executives were the passengers on board and made up nearly half the company's staff. Amazingly, the company stayed afloat and has since tripled in size (both number of employees and portfolio size) in just four years.
What happens in a minute: 70K Hours of Netflix watched 3M videos watched on Snapchat 2.4M questions are asked to Google Wendover Productions uploads a plane-related video
Yes, I remember the first time my CEO got really mad at me. I had taken an economy seat with a 4 hour layover instead of spending $5,000 more for a direct flight that only had first class seats available. I was young and he had to remind me that my time was far more valuable to the company that the $5k used for the first class ticket so I could arrive a half day earlier.
I agree with his assertion. However, with WIFI connectivity available everywhere and on planes I wonder about the value proposition of taking a private jet nowadays (I know you weren't taking a private jet). I think a lot of private jet usage is due to vanity and comfort. Nothing wrong with that, of course.
@@davidm8351 the real value of the private jet comes from being able to choose airports that are not available on commercial lines so that you can save time. Example: I once had to visit a potential client HQ that was in the middle of nowhere on the Great Plains. It took me 3 flights the last a prop puddle jumper to get to the small airport close enough to use a taxi. I wasted 8 hours (counting trip in both directions) compared to if I had used a private jet to fly direct.
How many corporation headquarters need to move to Bentonville for make private jets not cost justified. Move Walmart corporate offices to Chicago like Boeing.
Walmart/the walton family have poured tens of billions into the local city and state, they plan on staying there long term and are doing the opposite of tax cuts, and instead investing in their state.
@Literally Shaking yea its really cool ! Its called A Squidman of a few words and its by SpineBender i found it on google images but he posted it on what i believe is a site called DeviantArt
I work as a flight instructor at a smaller airport in Florida. When I got hired I was amazed at the amount of private jet and turboprop jet traffic that comes through on a regular basis. Even random companies like miraclegro, belk and bread companies have jets.
It may be more expensive, but short haul it makes sense. I was fortunate to fly private once with a friend to Mallorca, the turn around at the airport was what matters, in and out in 30 minutes. Time is the only thing that’s priceless to the wealthy.
Also, in vdo they only talk about time vs salary, which roughly mean how much company lose money per time but in reality. Company will also consider how much those CEO will make money for company per time. Which when consider both, larger company with larger profit will easily justify flying their CEO or upper management a private jet.
I have flown in a private jet many times. I can easily say that I've been in and out of the airport in less that 5 minutes. In fact, there were a few times I walked right off the jet and into a taxi, no time spent in the airport at all.
@@Saugaverse yes, same here. My friend has taken me on a few trips in a jet and it’s crazy. You get to the airport and your on the plane in 10 mins. You get off the plane and hop into the car. It is an insane difference vs commercial
@@ccecchini8355 I totally agree, that was the best part. And let's say that you're 10 minutes late, they will wait for you. There is no point in the plane taking off if all of its passengers aren't on board, cause that is what private flights are catering to.
Avery The Cuban-American that’s like saying “it’s great when another gaming channel uploads another video...about rainbow six siege”. Besides aviation being an amazing topic, there’s so much economics and logistics that go into it. Thus, Wendover will upload a lot of videos about it. Really his first popular video was about aviation. So it’s nothing new at all.
I work at an FBO (fixed based operator, which provides services for private jets and small aircraft), and let me tell you, I've never seen more personal and family travel on private jets than this year! Private charter traffic is up nearly 40% compared to before the pandemic because more people are realizing that flying with private charters saves much more time compared to going on commercial aircraft (and companies are figuring out ways to lower charter costs). The private charter industry is in its golden age right now, thanks to the pandemic.
I did exactly this math last year. To flight my entire family (including brother's family and my parents) business class would be way more expensive than charter a private flight to our vacation destination.
As someone who works at Walmart home office, very interesting to learn. The Jets aren't used by just VPs and exec's, buyers and merch ops people use them as well for Friday trips where they do store visits to targeted stores. Most are regional, within 1 hr of Home Office, so they aren't long trips. They give people who opperate a category to see a stores problems first hand and prescribe changes. The money generated by the stores from improvements typically outweighs the cost of actually flying there.
I think this is the correct answer. It’s not about how much the employee/exec is taking home in pay, it’s about how much their time brings in for the company
I make similar videos on my channel, I spend a lot of time on my videos but it's hard getting recognized. Could someone check it out and tell me if it's good or not? Thanks
A buddy of mine took me on a ski trip on his private jet. Is was the most amazing trip ever. To be able to pull up 15 feet away from the plane and then board with no wait was amazing. We landed and his rental car was waiting 20 feet from the plane. Soooo cool!
dannydaw59 they do, when flying international, you must fly to an airport with a customs office. The custom officers then come on the plane and do a thorough check, they do a good job.
I work for a company with a pretty large corporate fleet that I've flown on a bunch of times. I think corporate did the math and found it's basically a wash in terms of cost where you can take day trips vs. having overnight with hotel and rental car, but the upside is you can show up 5 minutes before the flight time and go....no TSA or whatever.
@@SebastianPeitsch That's not so much the problem. It's people don't want to waste their time with public transport. If I hope in my car I can get downtown in 10 minutes. By bus is like 45minutes. I also have to dedicate the time to walk to and wait for the bus.
@@MrJaaaaake Yeah but the thing is once you do it and get to know all the bus routes and when they leave, how long it takes you to walk, and how much time you save during rush hour, you find out that you can get there just as fast and without the hassle. I know it sounds weird but I am so much more relaxed when I get home when I don't have to drive everywhere all day. I did 25000 miles/40000km a year in the past and let me tell you - I don't mind taking twice as long as long as I don't have to deal with people who cut me off and stop-and-go traffic
@@SebastianPeitsch Public transportation takes much longer. There is a bus stop every 2 minutes. You end up at every red light. Old people and disabled people taking 2-5 minutes to get on the bus. You don't save anytime. You lose time. Buses are on a fixed route. I know when certain areas are congested so I can take a faster route. The nearest bus stop is 10 minutes away. It literally takes me 10 minutes to get to most places after going 20 seconds to my parked car.
I flew corporate jets for several years. We did some crazy and ridiculous things just because we could. I remember flying veal sausages into the Indy500 on race day, because the corporate suite had run out, using a helicopter to land on the infield during the race. Or flying a sail to a sailboat race because one had been damaged. We often flew 2 Lear-jets, 5 minutes apart, to the same destination, because of company policy that 2 VIPs could not fly on the same plane. I even remember flying an empty Lear-jet to the east coast to pick up a piece of furniture, because the CEO was on the BOD of the local museum. Amazing how hard some people work to make money just so they can waste it.
Don’t envy these people. They are loaded, but they pledge their souls to a company. I’ve seen senior management at big companies I’ve worked at. They’re rich people, but not happy people. Long hours, the weight of the world constantly on your shoulders. Big money is great if you win or inherit it. Working for big money is seldom worth it.
@@Jimboy1611 "Big money is great if you win or inherit it. Working for big money is seldom worth it. " This more than likely isn't true and is probably a lot more valid for the former than it is the latter.
Money can buy you a jetski. Have you ever seen someone sad on a jetski before? I think not. Money can make you happy if you know how to use it to make you happy.
You skipped one point, people who can afford to fly private are buying time and convenience. After a certain point on the economic scale money starts to lose it value when compared to time and hassle. This applies to all of us just on different scales. Example: Many of us will stop at a convenience store instead of Walmart for a quick, minor purchase. We pay more at a convenience store but in return we get a quick, easy visit. The uber-wealthy pay more for a quick point to point flight for the same reasons. We all like to save time and hassle to them the cost is worth the savings in time and hassle.
Plus when he visited towns where one of his stores was being built, he'd fly over head to see how construction was going. Then land, and he'd visit said site, and shoot the breeze with us workers.
@@alilabeebalkoka "more money than cents" What the heck is that supposed to mean? Not only are you mixing an uncountable noun (money) with a countable noun (cents) causing a grammatical inconsistency, but they refer to the same thing, meaning you are saying he has more than he has, a grammatical paradox.
Private jets are also often justified using a reason that can't fully be quantified - productivity. In most first- or business-class cabins, to say nothing of economy class, it's not possible to engage with others flying alongside you and have business discussions while in flight. However, this is exactly what private jets are designed for in many cases. Connectivity options, like phones and internet, can be made available on every flight instead of hoping you fly a carrier with Wi-Fi. This particular reason is why most national leaders have their own private jets - they need to be able to get down to business and talk with advisors 24/7, and you just can't do that flying commercially. Many companies have grown so large that the stresses and responsibilities on their leaders are similar enough to make private jets worth it for the same reasons.
I agree with your point, however most long-haul carriers in first have seriously stepped up their game in that regard. You may still not be that fast with commercial, but if you fly First, you lose very few productive minutes.
BottomFragger yes, but you won’t be able to discuss everything as you would on a private plane. For example a new product or strategy which could be sensitive to competition.
That's a fair point. I don't see many company executives flying together in first class or business class even. The process of security and the general public is still there, which is unhelpful to facilitste intelligent and meaningful discussion. Having been on a few (stationary, unfortunately) private jets, you can instantly recognize that flying on one would be a truly incredible experience.
During his time at HSBC in the 90’s, a family friend was involved in evaluating the business case for the company’s corporate jet. He told me that the most important factor in his evaluation was not the economics, but rather the effect on his career if he’d have nixed it!
Most CEOs can't afford to own a private jet. Their companies provide the corporate jet. $1m-$15m a year salary isn't enough to buy and maintain a private jet.
Yeah, private jets are expensive. $6 million is about the cheapest I've seen in terms of purchase price. (ignoring Cirrus's weird jet here, which is basically in the size and performance range of a mid-size turboprop) And that's only the purchase price. Maintenance and operation of such a jet, considering it requires dedicated flight crew, special maintenance contracts (jets are mostly in a different category legally from private prop aircraft, which forces you to use much more expensive maintenance services) And 6 million is if you're lucky. Realistically the starting price is closer to $12 million, and can be as much as $50 million for the larger private jets. (then again at that price you're talking something like an A318 - the smallest variant of the A320 family) Owning an aircraft generally is expensive though. Let's say you're a pilot with a basic private license like me. You want a plane, obviously, because what's the point in being a pilot if you can never fly anything? You're not too fussed about what you fly... But you'd rather not get second-hand or kit-built. So, let's take a really tiny aircraft that meets the LSA classification - 2 seats, 600 kg or less MTOW. Say, a Tecnam Sierra: en.wikipedia.org/wiki/Tecnam_P2002_Sierra This thing will set you back about $250,000 Australian. (I'm using Australian dollars for familiarities sake - but values in other currencies would be comparable. Slightly lower or higher depending on the currency) It's fuel usage is extremely reasonable at about 20 litres per hour, and it's cruising speed is about 110 knots. (~203 km/h) It also has an engine that can run both off AVGAS, but also regular high octane petrol used by cars. (only criteria is it has to be 98 octane) The fuel usage is about twice that of a large car (station wagon, 4wd, that kind of thing.) But, it's also going about twice as fast. So per unit distance travelled, fuel costs are about the same. So what other costs are there? Well, you'll probably need engine oil. Estimates for that size aircraft would be about 0.1 litres an hour. Oil costing about $14 a litre. With fuel at about $1.50 a litre... You're looking at about $30/hr in fuel. $1.4 in oil. Direct cost: $31.40 /hr So, what other costs are there? Well, the engine will need an overhaul after 1000 flight hours. New/overhauled engine will cost about $15,000 You'll need an inspection every 100 hours or so. Cost about $1500 The propeller will need an overhaul every 1000 hours. - $1000 Insurance: $3500 a year Hangar space rental (unless you're lucky enough to own one, obviously): $200 a month. (relatively cheap, but not trivial.) So, we can break the maintenance and inspection costs down to about $31 / hr Add that to the fuel costs, and your cost per hour flown goes to $61.40 Given fuel price fluctuations and the like let's just say $65 / hr But that's assuming you own the aircraft outright and don't need to pay a loan related to it. Your fixed yearly costs related to owning the plane are then $5900 Is that affordable on a moderate wage? Sure. Assuming you can afford to buy the thing in the first place of course. But this aircraft is useless for doing any kind of work with; it's purely for fun. And you can see if you're flying it only $100 hours a year, you're paying roughly $125 for every hour you fly. (relatively more if you fly it less, and relatively less if you fly it more, but still quite a lot.) And costs escalate rapidly. More typical smaller GA aircraft like a Cessna 172 use easily twice the fuel. Something like an SR-22 costs you about 3 times as much to buy, uses about 4 times as much fuel, and has vastly more expensive components (and thus higher maintenance related costs.) If you go up to the extreme end of private ownership you're looking at things that cost 20 times as much to buy, and probably 40 times the per hour operating costs... And the cheapest private jets are still vastly more expensive...
A European elevator/escalator company found small jets practical because of the small airfield capability opened up much more connectivity. They consolidated 5 warehouses and operating centers to a single facility and still maintained their servicing ability. It was the elimination of supporting duplicated facilities that made the rationale
I think you missed an important cost savings: instead of having 12 regions, they can have fewer executives managing more stores. The math is hard, but that alone could save millions more a year.
I would add to that the increased productivity of someone who got a full night's sleep in their own bed and skipped all the stress of airport rigamarole. Plus, commercial flights are regularly overbooked and delayed, whereas a private flight is more predictable and leaves when you say.
For the record, I used to fly to work on a private jet. I was not an executive or a CEO. So don't assume it is only the top Execs who fly on private jets.
My dad is the director of engineering of that airport near bentonville, Walmart private flights make up %30 of the flights that go in and out of that airport
@@mhc3200 the city is basically run by it. they have a hand in all businesses around the area, a majority of the city's population works for wal-mart, they effectively own the place, sam walton's children have HUGE impacts around town, they pay for parks, they improve things, but they also change stuff that people don't agree with all of the time. it's really strange to see the intertwined business and politics.
I though a flex was impractical by definition... But yeah, a plane can be a flex. I have also talked to a few executives who use them for tax write off
I’ve been in IT for a long time, and back before we had architectural redundancy, outages would potentially cost companies millions of dollars per hour. Back in the 90s you could walk up to the counter at an airport and buy a plane ticket to/from any major market very easily, and be on your way within the hour, but where our offices/datacenters were situated were typically much closer to smaller municipal airfields than to major hubs with regular shuttle service. That is the major justification for private jets in a lot of industries. If you want to fly “private”, as in strictly meaning not open to the public, often, and at no charge to you, join the military. You may not choose where you get to go…but sometimes you get more leg room.
Walmart doesn't just fly one exec. More likely a team of 5 gets on board. That makes those trips super competitive vs flying commercial business class.
@@aidenhenrie4736 It might not be particularly friendly to the environment, but at that point, it definitely makes sense for the company. They probably don't even care about that part, and it hardly factors into whether or not it "makes sense".
One thing missed is a employee will add more value to a company than their salary. If an employee is being paid $100k/year they may be adding easily $200k+ to the company. That makes their time even more valuable and any days waisted would impact the company negatively.
Did they ever make the runway long enough so it can take off full of fuel? The old global couldn't. They made the mistake once and almost didn't make it off the runway in time.
@@shotelco Indeed, Dassault has about an 8% market share, so there must be some of their jets around :-) Gulfstream, Bombardier and Textron are way ahead of them in terms of $ sales.
because doing the research made him realise that private jets are little more than obscene displays of callous disregard for climate change and economic inequality... yet he still had to try and justify them. this means he's not devoid of empathy or suffering from cognitive dissonance, which is great.
As a private jet pilot. I would like to thank you for finally explaining this to a large audience. I don't think most people realize how hard a CEO works and how valuable their time is unless you see it first hand. I'm shocked any fortune 500 CEO gets more than 3 hours of sleep a day.
there's an article I've read on the French version of GQ couple of years back about flying private. They were talking about the French petrol company Total and they were saying that private jets have a real "negociating power". The example given was when of their businessmen had to go Africa to negociate. Some cities have one flight per day. Meaning that sometimes, them businessmen had to rush things in order to catch their flight and thus, lose some negotiating power. The businessmen on the other side of the table knew that and played the clock. But if you're flying private then you have all the time in the world.
Sounds awfully dubious to me. If your negotiation is so important, stay the extra day. Or you know, don't plan on leaving until the day after business concludes.
@@babyhuey6342 still, if you have a fixed scheduce and the other party knows that they can draw things out in order to come close to the deadline and gain power
@@babyhuey6342 I agree, but as the person after you says, the other guys might know you're on a tight schedule. Specially if you negotiate on a Friday for instance. And the article (I should have mentionned) talked about special destinations where there's less than 7 flights a week. Of course it wouldn't work on a NY-Paris Flight or a London-Dubaï.
Fun fact: Airbus has two flights on every business day from Hamburg to Toulouse and back - one in the morning and one in the evening. And it's not a small private jet, it's quite a big plane (I think it's an A319 or A320). And it is almost always pretty much booked out by workers.
Since Walmart pays for the flight, the salary is not relevant, it's the value of getting done much quicker. What they pay him doesnt change, their effective work changes as they become a much more efficient employee.
@@Septimus_ii that is incorrect. They always value his time more than what they pay him, as the employees are profitable investments, not a break even expense. If they pay $1m, likely he brings back a whole lot more than $1m to Walmart.
Except that you can’t fly the 19 top manager in the same airplane ... It would represent a great risk in the eventuality of a crash :/ Really nice job dude !
Love your videos! Especially on planes! Would it be possible to do a video on explaining how regional airlines work (such as Skywest, Expressjet, and Compass airlines flying for Delta connection, American eagle, and United express)? I think it would be a great video and clarify a confusing topic
People often forget to include that those hours saved are used to make decisions that makes billions of profit for the company(walmart as the example given). If one considers private air travel then costs is more or less irrelevant. I don't know about other industries but for retail real time data is an edge that put walmart and other large retailers ahead of the industry. It is one of the reasons why people could buy very affordable goods at walmart.
I think you may have done the economic evaluation backwards. From the perspective of a company, the company would evaluate whether or not it's worth it to fly a jet by looking at how much net value an individual adds to the company. That would be the gross value added LESS the person's salary/benefits/etc. Your analysis only makes sense for an individual with a salary paying their own way without a company paying for them.
No Wendovers system makes sense. If you work out that in 3 hours someone earns 15,000 dollars. A private jet says let's saves 3 hours but costs 20,000 dollars. So technically it is not worth it.
Your model is closer to reality but the question is how do you compute for "the net value an individual adds to the company"? The value of a company is in itself speculative in nature. Remember, valuation is more of an art than science. Especially if the company is private, there's no market cap to rely on. The salary model eliminates the speculative aspect of valuation because it's an actual cost, thus, imo it's superior for documentary purposes. Companies would also prefer the salary model because its cost-to-cost, without speculative valuation w/c makes decision making more objective.
Barney Garcia Also, the jet itself generates value. Being able to fly potential clients to you for meetings makes them much more likely to buy whatever you are selling.
Couple of things to add to this great video. 1. As you noted, the aircraft are almost never flying a single executive. They are almost always carrying at least a couple of senior leaders, and usually a few executive leaders as well as the requisite support staff who are essential to enable the types of meetings that typically require in-person presence of such senior leaders. 2. However it is unlikely that all or even a majority of c-suite leaders would be on a flight (especially over water as in the example) due to business continuity planning.
A small critique: wouldn't the number you're calculating need to be the value that said VP/employee is bringing to the company (as opposed to how much they are actually getting paid)? Walmart (or any free market entity) would seek to get more value from an employee than what the employee he/her-self it worth. I may be splitting hairs here but I think it's a distinction worth making! Like your vids!
The idea is that since during all those extra days the VP is traveling he's not working, the company loses in productivity per hour. Cut that 4 day trip to a 1 day, and now you have 3 extra days of the VP doing work that they don't have to hire another VP to do.
@@thelight3112 He's not talking about that, the value of an employee exceeds their salary, else there would be no point in hiring them, so that is the real figure that matters.
Exactly what I also thought. You've to consider 3 things which is Time, Salary and how much money that person make for company. If they(Board) believed company success is mostly due to this CEO. It's mean that CEO worth a lot to company and they'll pay a crazy sum to maximize that CEO's time.
Always made me laugh how the emphasis is on us regular folk to get electric cars while a few hundred miles of one Exec. in his private jet out does a years worth of polution saving.
basically impossible with current tech to get the benefits of private jets without pollution, so most CEOs use private jets anyway whether the general public use ICE or electric cars, might as well start the transition to clean energy with everyday vehicles, and once the tech is developed then switch our air travel to electric
My friend is a pilot and he currently is doing surveying work and was looking at buying a car. When he started talking about wanting a hybrid to help the environment we all busted up laughing and asked him how much gas his plane burns, and then he shut up lol.
@@onlinealias622 a hybrid car, unlike an electric car which uses coal power, refills its own battery. I'm so glad you mocked your friend out of making a good environmental choice. You must use no coal/oil at all, right? 🙄
@@NadiaSeesIt There are plug in hybrids which still use "coal power" and inefficiently burn fossil fuels. Coal is also used much less nowadays for large scale energy production, especially in Europe, so it still is often better fully electric.
Great video, I also want to add. A business CEO could have a meeting in the DRC for $500 million and the only way to get him there is by private jet because there aren't any public flights available in that part of the world. Therefore the cost to profit ratio is tilted to the private jets favour.
For the Walmart scenario, there's also the fact that many stores aren't in a town service by a commercial airport. Many stores, such as Spearfish SD would require some drive time after landing at the "nearest" commercial facility.
Reasons to use a private jet: 1. Leave at whatever time you want. 2. Only fly with people you know. If anyone. 3. Eat food you want, when you want. 4. If you are flying from NYC to St Louis and you realise you need to do something in Detroit, quick chat with the pilots, problem solved. 5. You can use pretty much any airport you want. 6. You dont have to wait for (possibly) hundreds of other people with their screaming kids to get on and off. 7. If you get stuck in traffic on the way to the airport, the plane will wait for you. I could probably list another 10 or 15 things but you get the idea. Its safer, easier, less stressful and, let's be honest, more fun. If I had the money I'd fly private all the time.
Two pro-private-jet arguments that I wouldn't agree with, but which I was surprised to see Sam decide not to make, are that the time on the plane can be used much more productively as opposed to even a first class suite on commercial flights, and the appeal of a private jet fleet could tip the recruiting balance in a company's favor when looking for and hiring the most talented executive staff.
That's cause this video was rushed. Flexibility and added security are other factors that can't be measured as to why corporations use private jets over commercial first class or business for their execs.
Yup, nailed it. This is exactly why investors don't care about these major companies using private aircraft for business trips instead of demanding commercial - the point is that the time savings will create more than enough profit to compensate. Never mind the fixed schedule of commercial flights no doubt wasting some variable amount of time each trip, not to mention last minute changes in plans that commercial obviously won't be flexible with in any way. Frankly, the real question is how can a large global company justify NOT having at least some form of available on call private transport - the value of a single business deal made in one trip alone can potentially justify the cost, nevermind the ACTUAL value to the company of the staff that may use it throughout the year
sucks that employees have to be paid less than their labour is worth to the company to be employed it'd be neat if we came up with some communal idea to stop this, we could call it communalism or something? idk just a suggestion, the name might need some work
I don't believe that was meant to be taken literally as these employees aren't actually paid by the hour. It's just a way to compare costs for the company. I think that's more useful than comparing to the actual value an employee adds to the company, a plane ride should be considerably less than this or it wouldn't be worth it. You know what I mean, if travel costs were that much higher than salary they could just hire more employees to divide up the regions and add that much more value to the company.
Like I said in another comment thread, you're literally just repeating Karl Marx's *disproved and obsolete* Labor Theory of Value; yet this comment is getting so many thumbs up. People today are absolutely retarded regarding Economics, YET it's the main thing they complain about. Baffling. If you truly believe a person isn't paid according to value, then you not only don't know how Economics works, but you have no comprehension of how the abstract concept of "Value" works either. It's like believing 2+2=1, the very fundamentals are fucked up here.
My dad was an executive at Kodak, this about sums it up. They preferred 4 executives, or CEO per flight. With restrictions on certain people flying together in case of crash.
@Yama Fanboy It was probably a joke, just to spite pilots. Of course pilots and bus drivers have vastly different requirements, but you don't need to be a "physics genius" or mathematician to become a pilot. I think you really exaggerate the skills needed. You probably need a basic to intermediate (at most) understanding of all these subjects, but not really an expert level understanding. I really doubt an airline pilot is better at meteorology than an actual meteorologist who has a degree in the field. Most calculations needed are done by plotting the data into a computer, at least on most modern aircrafts. Also, multilingual? You just need to be able to speak english, so not really.
You left out a few more important considerations, for example, the amount of time that it takes in either alternative to resolve a problem and make a decision, which might be much more valuable.
Maybe he took a class on broadcast and he’s learning to use his diaphragm to talk so he sounds more professional. Or maybe he had a cold last week. Who knows?
I've flow both private business (as a guest) and regular air. Having all those layovers and missed connections sure makes me pine for the private jet again. But the private jet costs 60 million...
A small jet can be an order of magnitude less costly. A Honda HA-420 Hondajet for example costs about $5.3 million and is relatively fuel efficient. An Embraer EMB-500 Phenom 100EV costs about $4.5 million. Many of these small jets also only require a single pilot instead of two on many of the larger jets.
You forgot that one saves more time by landing at smaller airports, which are closer to the final destination. Thus, you do not only save time during check-in and check-out, but also during commuting to the final site...
As some other commenters have tried to say, the salaries are irrelevant. They are, at the time of the flight, a fixed cost to the business. Economically speaking the business is trying to make sure that the marginal utility of the activity exceeds the marginal cost. The marginal utility is the value of each extra hour's work to the company that private jets enable (which should be many times their salary). The marginal cost is the extra cost of the activity - over and above the fixed costs. In effect, these things just make private jets a more compelling activity. An executive will also travel with an assistant - at the very least. He/she will also be able to perform valuable work aboard the private jet - so the extra utility should now include those hours.
I'm an ACC service tech at a Walmart, and I'm literally sitting outside the shop on my lunch watching the beginning of this video thinking "I bet the winery CEO owns 20 private Jets".... I didn't think I was right lmao
@@ReptilianLepton Yeah. This is Africa bro. That $3 is not a must. Depends on how many heads get a cut. Sometimes it is just lunch and you walk home. But am not complaining. I know guys who cannot afford rent for lack of job. They sleep on polythene paper! To them am almost like those CEOs over there.
Great video, something to add: the value the passenger adds to the company per hour should always be more than the hourly rate of the employee. A private jet might allow productivity on the passenger to remain high both on the trip and on arrival. When this is factored in it makes a little more sense.
@@mergg3365 Bull shit, I live next to the largest general aviation airport in Virginia which is also next to Jiffy Lube Live (a massive stadium-style concert venue). Every artist that performs at that venue flies into the airport on a private jet, from Tailor Swift to Wiz Khalifa. Maybe it is the label flying them around for the tour, but that doesn't change the fact that they're using private jets more per year than the average American takes flights in their lifetime while lecturing the rest of us. I'm not even against private jet use because I understand the economics behind it for people whose time is valuable, but the hypocrisy needs to stop. I have friends filling their jets up with fuel and emptying the waste tank every day who could only dream of that kind of luxury, but they gotta listen to those same assholes lecture them on TV at night. Fuck celebrities.
@@MrMattumbo So they fly in a private jet while working. That's what Mergg said. Despite the economics for a stage tour that needs you to be in a different place nearly every day far away from the last one and with enough rest to do a 3 hour concert and preparation before.
that's making the weird assumption that you can't do any work in the plane, that the entirety of the time spent in the plane is lost to the void. Perhaps it wasn't the case 30 years ago but today most things a CEO could do can be done aboard. Nowadays it feels like its often a non monetary compensation of the job rather than a way for companies to save money
I came here to say this. They can work on the plane and when they get where they are going. And so what if they have to eat and stay at a hotel. It wouldn’t be a sin if they actually contributed to the local economy of their stores.
You don't consider the possibility that passenger in private jet could actually do (confidential) office work while in flight. Such as video conferences.
Some aircraft (particularly low-capacity prop planes) are very much worth it. Diamond DA62s burn 1 gallon every 19.32 miles, which is about the same rate of fuel consumption as the standard SUV. Since the DA62 can go up to 228 mph, you can shave up to 80% off your trip time without needing to step through TSA. While the DA62 isn't very luxurious, it has Garmin Avionics, autopilot, and two engines for additional safety and stability. God, I sound like a Diamond commercial...
It's worth more than the CEO's salary if there is a hold up. Elon Musk once sent his private jet to deliver one part to the launch site of the falcon 1 instead of just mailing it, because the entire team was waiting on that part.
@@jakeyocum5361 Turboprops don’t need a ton of range for short hops, and speed is not a huge consideration due to the small distance also. Many turboprops, like the Daher TBM series go nearly as fast as light jets anyway. They can also land in much shorter distances, opening up even more airports.
Just graduated from the University of Arkansas, about 20 minutes from Bentonville. Walmart, Tyson, and JB Hunt are all headquartered in NW Arkansas and because of that, that region of the state is exponentially more developed than the rest of the largely agricultural state
You are missing some key details 1. Private jets of the majority are fast 2. They require less fuel than airlines 3.It is easier to train private jet pilots than airline pilots. 4. Some executives don’t use jets they use turboprops and twin engine planes And 5. Some executive can place there jets in management companies where they companies/executives share the costs with other. 6. Also private PLANE trips are not everyday they can happen every week or simple at irregular times I would recommend you read about king airs, PC 12s, and Textron private aircraft.
It wasn't mentioned but I can also see the lack of a private jet fleet being the deciding factor in a CEO not taking a job with someone. And when you're a multi-million-a-year CEO on the job market, corporations are selling themselves on you, not the other way around.
Great video. I work in this space and corporate aviation is often misunderstood. Clearly there is a climate challenge with all aviation but many people don’t appreciate the issues raised here. Good job.
Munden : you tell the truth... I provide US$1.00M value into the business; but, I will receive the salary US$ 2500.00; with a good “advisable Order” - “next time you should do better, cheer up !!!”
"Half the Fortune 500 companies in America are getting rid of their private jets. Not me: I'm flying that sumbitch straight into Bankruptcyyyyyyy!" - Ron 'tater salad' White
normally i'd say that stock footage latte guy wasn't a good fit for someone watching a documentary.. but i'd be damned if that shit wasn't me watchin this video.
Also figure some companies split the work between their fleet, and commercial. Like the trip to the Philippines, you could fly the company jet to LAX or San Francisco just in time to catch the commercial flight to Manila. The flight is short enough to allow a company plane to fly it (with a single crew based in Bentonville), it has the greatest time savings, minimizing layovers, without the expense of chartering a long range jet, paying two crews, and a reset at an outstation.
Other (better) reason: During contract negotiations time pressure (to make the airline return connection) often gets leveraged. With corporate aviation that contract negotiation delay tactic, is simply solved with a mere call to the pilots to postpone the departure a couple of hours.