Wheels Up founder Kenny Dichter is out as CEO. A pioneer in on-demand private jet services, Dichter created the company in 2013 and led it to be the first private-aviation service firm to be traded on the New York Stock Exchange.
The move came on Tuesday just ahead of the company's first-quarter earnings report, which met Wall Street expectations of a loss of 31 cents per share. After gaining as much as 6% in pre-market trading, the stock swung wildly, down more than 17% as of 11 a.m. Tuesday at 41 cents a share, while all the major U.S. indexes had slid only a fraction of a percent on the day. After going public in 2021 in a SPAC deal, the stock peaked shortly after at just over $11 per share. Wheels Up stock was down nearly 85% over the past year as of late Tuesday morning.
Chief Financial Officer Todd Smith has been named interim CEO, reporting to Ravi Thakran, former Group Chairman, Asia for LVMH and former Chairman and Founding Partner, L Catterton Asia, who will now serve as Executive Chairman.
Smith joined Wheels Up last year after 25 years at General Electric where he worked in a number of senior divisional CFO roles. He will continue to serve as the Wheels Up CFO, the company said.
"The changes we are making position Wheels Up to deliver attractive returns and profitability for shareholders and an amazing experience for members," Smith said. "I am excited to be working even closer with Ravi and Board, as well as the talented Wheels Up team, on our exciting next chapter. I would also like to thank Kenny for his vision, leadership and all of his contributions to Wheels Up."
Dichter will continue to be a member of the Board of Directors, the company said in a statement.
"I'd like to congratulate Ravi Thakran on his new role," Dichter said in the statement. "Having worked closely with Ravi, I know he brings a sharp focus on the customer and a deep appreciation for what it means to deliver a premium experience.
"I would like to take this opportunity to thank our 12,000+ loyal members and customers - and the incredible Wheels Up team - who have made the company what it is today. 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. I am looking forward to supporting Wheels Up as a shareholder, member of the board, founder and a strong advocate for our brand and mission."
Wheels Up has retained a leading executive search firm to identify a permanent CEO, the company said.PREVIOUS STORIES:Wheels Up and AirMed partner to provide medical-transport services to members Wheels Up acquires Air Partner in move to expand globally"I am honored to take on this new role at the head of one of the foremost global companies in private aviation," Thakran said. "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.
"I'd like to thank our founder Kenny Dichter for his vision and work to make Wheels Up what it is today - the leading on-demand charter operator in the United States with more than $1.5 billion in revenue, more than 12,000 loyal members and customers and an iconic brand. I look forward to building on this foundation as we embark on the next phase for the company and its stakeholders."
In addition to building Wheels Up, Dichter effectively created the concept of a fractional jet card as he led Marquis Jet, which was sold to Berkshire Hathaway-owned NetJets in 2010.Wheels Up also announced on Tuesday, plans to restructure its services areas into two blocks - one that focuses on areas east of the Mississippi and parts of Texas - and the other focused on the rest of the U.S. that together with the eastern block makes up 80% of the company's flights.Almost all of its King Air aircraft will now be positioned in the east. "These new programs represent a fundamental shift in how we are bringing our products and services to market to best serve our members and bolster our path to profitability," Chief Commercial Officer Mark Briffa said. "As Wheels Up has grown, we've seen that a one-size-fits-all pricing and geographic service model doesn't reflect how our customers actually utilize Wheels Up or allow us to truly capture the operational and financial benefits of our scale."