Private-flight provider Wheels Up has raised concerns about its ongoing operations, even after receiving a short-term capital infusion of 20 percent from equity partner Delta Air Lines. The company announced today (July 9) that there is now "substantial doubt" regarding its ability to continue operating, leading to the postponement of its second-quarter earnings call, originally scheduled for this morning.
In addition to Delta's financial support, Wheels Up has disclosed its decision to sell its aircraft management assets to charter and management firm Airshare. This move comes as part of Wheels Up's strategy to divest non-core business units. The transaction's details have not been revealed, but the deal is expected to be finalized in the third quarter of this year.
Wheels Up, previously holding the third-largest charter, management, and fractional portfolio in the United States, had recently announced its intention to streamline its operations. The partnership with Delta Air Lines was seen as a significant step towards enhancing its services. Delta CEO Ed Bastian emphasized the strength of their relationship and Wheels Up's reputation for providing a high-quality experience.
Despite the uncertain outlook, Wheels Up experienced an 8.3 percent increase in premarket trading, with shares reaching $2.60, as reported by Reuters.
