Wheels Up Founder Steps Down as CEO

Kenny Dichter, the founder of Wheels Up, has stepped down from his role as CEO of the company immediately amid mounting losses. The decision was announced on May 9, 2023.

Dichter, who founded Wheels Up in 2013, will continue to be a member of the Board of Directors. CFO Todd Smith has been named interim CEO, and current board member Ravi Thakran has been elevated to Executive Chairman. The company has hired a leading executive search firm to find a new permanent CEO.

“As we continue our path to profitability, this is the right time to take on a new role where I will support Ravi and Todd and the business,” Dichter said.

The changes in leadership come as Wheels Up faces increasing losses. In its first quarter financial results, the company reported an increased net loss of USD$101 million, which is USD$12 million more compared with 2021.

In a separate announcement made on the same day, the company stated that it was updating its membership programs and creating two focus areas which it says accounted for more than 80% of its customer flights in 2022.

Those two areas are described as ‘East of the Mississippi River with parts of Texas’ and the ‘Western Region of the country’. It will concentrate its sizable King Air fleet in the first of the regions, whilst the jet fleet will be split across both regions, which it says will reduce costs across almost all aircraft classes.

“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,” said Smith.

The US charter company recently posted an overdue 2022 annual report that showed a USD$555 million loss on revenues of USD$1.58 billion. The loss was a 157% increase from USD$197 million in 2021, due to high non-cash impairment charges.

In March 2023, the company announced a restructuring plan and decided to reduce around US$30 million in annual staff costs in order to get the company profitable in 2024. In April, the company proposed a reverse stock split to increase its per-share price in a bid to stall its financial losses and decreasing share price. 

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