Worrisome Move Attributed to Fleet Reduction and Lower Attrition

Private jet provider Wheels Up has laid off about 11% of its pilots. 

The Delta Air Lines-backed company says the layoffs were necessary because more crew members are choosing to stay with the company even as the company consolidates the number of its operating certificates to achieve more efficient management.

Prior to the investment by Delta, Wheels Up had scaled back its fleet and reduced its service area.

It also sold its aircraft management operation to Airshare, another fractional/charter and jet card provider.

Wheels Up had also acquired six other charter providers between 2019 and 2023 but the company faced difficult challenges integrating the operations.

Delta helped the struggling company avoid bankruptcy in 2023 by acquiring 95% of the company for $500 million after previously providing loans of $70 million as Wheels Up had been faced with climbing losses since 2021. The company reported losses in Q1 of 2024, but executives say they still expect to achieve a profitable EBITDA by the end of this year.

Delta board member George Mattson was appointed CEO of Wheels Up after closing the investment deal and he said, “We look forward to working closely with Delta and our other investors to deliver best-in-class operating performance and an exceptional customer experience, which, as we deepen our commercial partnership, will also enable us to provide a one-of-a-kind seamless connection between private and premium commercial travel.”

Delta’s CEO Ed Bastian spoke about his outlook at a members event at the 2024 Masters tournament, saying,“(Delta’s) strategy for the last 15 years has been to continue to rise above. Then you start building premium services, DeltaOne, the lounges. The thought (Wheels Up founder) Kenny (Dichter) and I had is that the next step of premium is private. No airline has ever had a private experience at scale, and this is what we’re building at Wheels Up.”

FMI: https://wheelsup.com