Wheels Up Reports Losses, Names New CEO

The on-demand private aviation company also announced program changes aimed at improving profitability.

The company said it hopes to be profitable by 2024 after cutting costs, streamlining operations and accelerating its digital infrastructure. [Courtesy: Wheels Up]

Wheels Up (NYSE: UP) founder Kenny Dichter has stepped down as CEO and a new slate of leadership installed, the on-demand private aviation company announced Tuesday.

The news comes as the company announced program changes and as it searches for profitability through cutting costs and streamlining operations. 

Dichter, who launched the company in 2013, will continue to serve on the board of directors. Chief financial officer Todd Smith will step into the role of interim CEO and report to board member Ravi Thakran, who will now serve as executive chairman, the company said. Thakran is the former group chairman, Asia for LVMH and former chairman and founding partner of L Catterton Asia.

“I am honored to take on this new role at the head of one of the foremost global companies in private aviation,” Thakran said in a statement. “As Wheels Up continues to scale and evolve, I am looking forward to leveraging my experience leading some of the world’s largest luxury brands to drive success in providing an extraordinary experience for our members while at the same time delivering on our commitments to profitable growth.”

In its first quarter 2023 earnings also issued Tuesday the company reported a $26 million revenue increase year over year to $352 million. During that same period, however, its roster of active members dipped by 1 percent to 12,285, and its tally of live flight legs shrank by 13 percent to 15,389. Net losses also increased $12 million to $101 million, it reported.

The company also announced Tuesday it is instituting program changes that will “align guaranteed service in regions where Wheels Up has a significant network density advantage and margins are highest.”

Wheels Up will now have two primary service areas: east of the Mississippi River including areas in Texas, and the western region of the U.S. It will concentrate its Beechcraft King Air fleet on the eastern region, while flying its light, mid and super-midsize aircraft in both regions, it said. Destinations outside of the two areas will be served by its Air Partner subsidiary.

“By focusing our fleet in the areas where we have substantial demand and resource density, we are able to offer superior pricing, better service and improve the efficiency and profitability of our operations—all while keeping the customer firmly at the center of everything we do,” said Mark Briffa, chief commercial officer.

The company is also evaluating the disposition of non-strategic assets as it sharpens its focus on its core charter business, it said.

“As we position Wheels Up for future success, we expect the program changes we announced today will allow us to continue to scale and evolve our product offering to deliver world-class service profitably,” Smith said.

Kimberly is managing editor of FLYING Digital.

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