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Wheels Up is closing down multiple maintenance operations as part of a larger plan to restructure and open a larger, state-of-the-art facility. The private aviation company is closing down operations in two cities and relocating mobile service units in several others to reallocate resources to a new maintenance center at the Palm Beach International Airport (PBI) that will open later this year.
A press release on Thursday revealed larger plans to open up a new maintenance facility at PBI as part of a strategic shift in the allocation of the company's maintenance facilities to better align with its geographic network and flight demand density. As part of the preparation, Wheels Up is reallocating from its underutilized facilities where it says there is less organic flow and flight traffic. This includes the immediate closure of the existing maintenance operations in Cincinnati and Broomfield, Colorado along with the reallocation of several mobile service units in Sacramento, Las Vegas, Salt Lake City and Burbank, California to the Eastern U.S. This is in addition to the reallocation of Fort Lauderdale's facility resources to the new location at PBI.
"We at Wheels Up are continuously evaluating and acting upon opportunities that will drive efficiencies and control costs, all in service of strengthening our business model and improving our member experience," Wheels Up CEO George Mattson said. "The opening of our new state-of-the-art maintenance facility at PBI is a key strategic step, leveraging our resources and locating our facilities in areas of high flight frequency. As a result of these measures, we are improving reliability and efficiency while reducing costs as we continue to drive toward Adjusted EBITDA profitability later this year."
Wheels Up is coordinating with MRO providers FEAM Aero and AVEX Aviation in Cincinnati and Broomfield to provide a path for placement opportunities for the staff. According to The Denver Post, ceasing operations at the Rocky Mountain Metropolitan Airport (BJC) will lay off 65 employees by June 16. This will affect all of the Wheels Up employees based at the airport except for select administrators and office employees who will remain due to their role in supporting other Wheels Up locations.
"The decision to close these facilities is not one that we made lightly," Wheels Up COO Dave Holtz said. "Our entire maintenance team is responsible for driving meaningful improvement across key customer experience indicators, particularly total completion rate and on-time performance metrics. Our people are absolutely crucial to our success, and we are highly appreciative of the MRO providers we have partnered with to ensure that we take care of the staff affected by these closures in every way we possibly can."
The closure of the Cincinnati and Broomfield locations will begin immediately and the Fort Lauderdale relocation will commence following the opening of the PBI facility later this year.RELATED STORIES:Wheels Up names new CEOWheels Up stock takes wild ride after $500m lifeline from Delta
The company has seen immense changes in the last year, with founder Kenny Dichter stepping down as CEO in May 2023 and taking a $500 million lifeline from Delta Airlines as the company took on 95 percent ownership. Wheels Up appointed Mattson as the new CEO in September, with over 25 years of aviation experience and a longstanding member of Delta's Board of Directors.