Plans 2017 European Expansion

By: Kathryn B. Creedy

Wheels Up is not resting on its accomplishments in democratizing business aviation. With more than 3,000 members, CEO Kenny Dichter sees a need for up to 200 more aircraft and expects to launch European operations in 2017, again using Gama Aviation as its Part 135 partner. Dichter said 90% of the top European city pairs are within range of its fleet. Indeed, his goal is to triple Wheels Up members in three years and noted every 50 to 60 new members requires a new aircraft.

“If you look at business aviation from the OEM perspective, the market looks flattish,” said Dichter (pictured, left). “But in other areas where there are a lot of growth stories. When we started in 2013 we thought this was a 100-aircraft market, but today we think it is far more than that. We think that the two million people now engaged with business aviation could be multiplied 10 times and that is what Wheels Up is all about, democratizing private aviation. We are all about making business aviation more accessible to people. We feel a tremendous responsibility to disrupt and lead the industry. Our job is to make the pyramid bigger.”

Dichter, who noted that 35% of new members have never had a relationship with private aviation, indicated that Wheels Up has an 85% retention rate and is working on growing that to 95% in 2017. Gama, he said, is now the number two Part 135 operator in the world and predicted it would earn the top status shortly.

Wheels Up is also expanding service to members by establishing Flight Desk to accommodate members who need larger and longer-range equipment beyond the company’s new King Aire 350i and pre-owned Citation Excel. Dichter said Flight Desk represented a $100 million opportunity within the next few years, noting demand tripled since it launched Flight Desk six months ago. Flight Desk vets various operators and crews to provide members with the same quality assurance of Wheels Up. Indeed, the company is now working with 80 of the 2000 operators in the US.

Wheels Up is a subscription service that generally halves the hourly price at $3950, which has never changed. It is now offering members “Hot Flights” to fly empty legs for $295 for the entire plane. It is also organizing weekend shuttles to increase aircraft utilization.

“We examine what was going on Saturdays which is a low day for business aviation and targeted sports,” he explained. “College football is very popular so we worked with ESPN to get the word out to stimulate demand. We created Same Day Game Day fan-favorite shuttles during the fall. With the app we aggregate eight people to fly to the games. In vacation markets we do the same thing to say Nantucket.”

About 25% of membership is corporations flying at two times the rate of individual members. “Corporate aviation sees value in this model and they can’t find it anywhere else,” he said. “Most of our member fly less than 200 hours per year and don’t want to own.”

Earlier this year it introduced its new $5,950 8760 Membership, a low cost entry offering access to its shuttles, Hot Flights as well as the Flight Desk. Its corporate level is priced at $29,500 annually and for individuals the subscription from $17,500 per year. 

In September, Wheels Up completed a capital infusion of $115 million from such financial institutions as T. Rowe Price, Fidelity Management and NEA, bringing the company's valuation to more than $500 million. The funding will fuel the company’s US expansion as well as set up bases in Europe and enhance its technology platform.

(Image from file)

FMI: www.wheelsup.com