Volato to Drop 5 Leased Jets, Furlough Pilots

The move comes as the CEO of the fractional aircraft operator said the company is 'facing financial pressure.'

Caleb Revill

Monday, August 19, 2024 at 05:45 PM ET

Verified

Edited By:

Kimberly Johnson

In a company letter from Volato CEO Matt Liotta obtained by FLYING, he explains his decision to ‘rightsize’ the company’s fleet and crew by removing five leased planes and furloughing some of its pilots. [Courtesy: Volato]

Key Takeaways:

Volato is experiencing significant financial distress, reporting a $34.3 million net loss and negative working capital, leading to "substantial doubt about the company's ability to continue as a going concern" and a notice of non-compliance with NYSE listing standards.
In response, Volato is "rightsizing" its operations by removing five leased planes and furloughing pilots, attributing these actions to delayed HondaJet deliveries, slower-than-anticipated demand growth, and efforts to improve aircraft utilization.
The company has submitted a plan to the NYSE to regain compliance by December 2025, while management believes current cash allows operations for at least one year.
The article draws parallels between Volato's current challenges and the recent failure of Jet It, another fractional ownership charter jet operator that faced similar issues with aircraft availability and reliance on new fractional sales.

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Volato (NYSE: SOAR) has notified employees of plans to remove five leased planes from its fleet and furlough pilots in an attempt to lessen financial pressure gripping the fractional ownership charter jet operator.

A Form 10-Q—a quarterly financial report submitted to the Securities and Exchange Commission— filed by Volato on August 14 showed the company spiraling into the red, recording a net loss of $34.3 million for the six months ending June 30. The same form stated Volato has a negative working capital of $18.2 million and an accumulated deficit of $98 million as of June 30. Net cash used in operating activities for the six months was $7.4 million.