With its fleet geographically concentrated, Wheels Up is rolling out lower capped hourly rates and daily minimums effective June 26, 2023
Under Kenny Dichter, Wheels Up wanted to be the Amazon of private aviation, offering something for everyone. Under Interim CEO Todd Smith, the goal is to be highly efficient and focused. Like Walmart, the plan is to stack them high and sell them cheap.
Wall Street analyst Jefferies puts it this way: “Q1 marks the next chapter for UP, shifting from a high growth one-size-fits-all strategy to a more profitable, targeted approach in high-density markets.”
In an industry that has seen jet card charter rates increase by 25% since the end of 2020, the new Wheels Up pricing and policies should generate consideration despite the company’s ongoing challenges.
The new Flight Services Agreement, sent to members today, reveals lower capped rates and smaller daily minimums.
Looking at pricing for members who deposit $200,000, hourly rates will drop between 2.8% (light jet) and 8.2% (super midsize), excluding fuel surcharge and FET.
Wheels Up 2023 New vs. Old Capped Hourly Rates ($200,000 Fund)
|Aircraft Category||Current Hourly Rates||New Hourly Rates||Change|
|King Air 350i||$ 5,295||$ 4,895||– 7.6%|
|Light Jet||$ 7,095||$ 6,895||– 2.8%|
|Midsize Jet||$ 8,395||$ 8,095||– 3.6%|
|Super-Mid Jet||$ 9,795||$ 8,995||– 8.2%|
|Large Cabin Jet||$ 13,995||Dynamic||NA|
However, as jet card buyers know, hourly rates, capped or fixed, are only part of the story.
Wheels Up is also cutting daily minimums.
In some cases, depending on deposit levels – $100,000, $200,000, or $400,000, members will see daily minimums drop by 30 minutes.
For example, daily minimums on super midsize jets go from 150 to 120 minutes.
New vs. Old Daily Minimums ($200,000 Fund)
|Aircraft Category||Current Daily Miniums|
(including taxi time)
|New Daily Minimums|
(including taxi time)
|King Air 350i||66 minutes||60 minutes||– 6 minutes|
|Light Jet||102||90||– 12 minutes|
|Midsize Jet||102||102||No change|
|Super-Mid Jet||150||120||– 30 minutes|
|Large Cabin Jet||180||NA||NA|
For a member who deposits $200,000, the result is flight cost savings ranging as high as 26.1% for a 60-minute flight on a super-midsize aircraft with an eight-passenger guarantee.
A 60-minute flight on a King Air will drop 7.1% from a maximum of $7,282 to $6,766, according to QUICK COMPARE FLIGHT PRICING from Private Jet Card Comparisons, which takes into account hourly rates, daily minimums, FET, fuel surcharges, taxi time, and amortized annual membership fees by flight hours.
A one-hour flight from Van Nuys to Napa on a light jet with the new capped hourly rates and a slimmer daily minimum will generate a savings of 13.8% over the current capped hourly rates.
The cost of a 60-minute flight on a super-midsize jet will fall 26.1% from $27,033 to $19,980,
Wheels Up – Flight Cost Comparison (60-minute flight – $200,000 fund)
|Aircraft Category||Flight Cost – 60 minutes (Current)||Flight Cost – 60 minutes (New)||Change|
|King Air 350i||$ 7,282||$ 6,766||(7.1%)|
|Light Jet||$ 13,517||$ 11,648||(13.8%)|
|Midsize Jet||$ 15,893||$ 15,344||(3.4%)|
|Super-Mid Jet||$ 27,033||$ 19,980||(26.1%)|
For flyers making 90-minute flights, the savings range between 2.7% and 25.9% (see table below).
Flyers needing eight seats can choose a King Air and see the maximum cost drop from $10,347 to $9,616.
For those who don’t want to fly a turboprop, a super-midsize jet with an eight-seat guarantee will drop 25.9% to a cap of $20,165, a per-trip savings of just under $15,000 out and back.
Wheels Up – Flight Cost Comparison (90-minute flights – $200,000 fund)
|Aircraft Category||Flight Cost – 90 minutes |
|Flight Cost – 90 minutes|
|King Air 350i||$ 10,347||$ 9,616||(7.1%)|
|Light Jet||$ 13,702||$ 13,336||(2.7%)|
|Midsize Jet||$ 16,078||$ 15,529||(3.4%)|
|Super-Mid Jet||$ 27,218||$ 20,165||(25.9%)|
For the typical two-hour flights, the new pricing offers savings as well.
Capped flight prices will drop between 2.7% and 18.6%
The maximum flight cost for a 120-minute flight on a super-mid jet will fall 18.6% to $22,311.
Wheels Up – Flight Cost Comparison (120-minute flights – $200,000 fund)
|Aircraft Category||Flight Cost – 120 minutes |
|Flight Cost – 120 minutes|
|King Air 350i||$ 13,411||$ 12,465||(7.1%)|
|Light Jet||$ 17,754||$ 17,281||(2.7%)|
|Midsize Jet||$ 20,828||$ 20,119||(3.4%)|
|Super-Mid Jet||$ 27,402||$ 22,311||(18.6%)|
The new pricing structure takes effect on June 26, 2023.
Even lower rates
However, members could see even lower prices since the capped rates are just that, the most you will pay on an hourly basis.
Yesterday, Smith told a Goldman Sachs investor conference that the company is testing demand for even lower light jet pricing.
It ran a similar test earlier this year with its King Air fleet on a regional basis.
Targeted members were offered lower rates for specific low-demand dates. Targeted members were in high-density areas designed to cut repositioning.
Smith said the test generated a double-digit increase in bookings.
It led to the launch of a new King Air Connect membership, which reduced capped hourly rates to as low as $4,495.
Other Wheels Up changes
Another nice change is for folks who join on a pay-as-you-go basis or deposit $100,000 in funds.
You can now get a King Air or Light Jet guaranteed at the capped rates.
Previously, it was either or, at Wheels Up’s discretion, unless you were flexible to move your flying.
As previously reported, the other big change in addition to geography is that there is no longer capped pricing for large-cabin jets.
You can use funds, but large cabin flights will be priced dynamically.
Also, as previously reported, the King Air program is no longer available in the West region, with details on the new regions below.
Not changing will be the long flight discounts for nonstop super midsize flights over 3.5 hours. The discounts, however, will be restricted for flights starting or ending in the East or West zone.
New Primary Service Areas
The good news will be limited to those of you flying between or within the two Wheels Up primary service areas.
The new East Primary Service Area includes Alabama, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Vermont, Virginia, West Virginia; plus these U.S. airports or cities: KMSN (Dane County, WI); KMKE (Milwaukee, WI); Dallas, TX; Houston, TX; Austin, TX; San Antonio, TX; Fort Worth, TX; College Station, TX; Sugar Land, TX; Waco, TX; McKinney, TX; KSUS (Chesterfield, MO) and KSTL (St. Louis, MO); and these international airports: MYNN (Lynden Pindling International Airport, Nassau, The Bahamas); MYAM (Leonard M. Thompson International Airport, Marsh Harbor, The Bahamas); and these airports in Canada: CYTZ (Billy Bishop Toronto City Airport), CYHM (John C. Munro Hamilton International Airport), CYYZ (Toronto Pearson International Airport), CYHU (Montreal Saint-Hubert Longueuil Airport), CYMX (Montréal-Mirabel International Airport), CYOW (Ottawa Macdonald-Cartier International Airport), and CYUL (Montréal-Pierre Elliott Trudeau International Airport).
The West Region where the new terms apply includes Arizona, California, Colorado, Nevada, and Utah, plus KJAC (Jackson Hole Airport, Teton County, WY); KBZN (Bozeman Yellowstone International Airport, Belgrade, MO); and SUN (Friedman Memorial Airport, Hailey, ID).
Blue Light specials
Whereas in the past, Wheels Up announced higher pricing and more restrictive terms and then gave customers and prospects up to a month to lock in the old terms for up to 30 months, Smith wants to incentivize flyers to move to the new Flight Services Agreement.
Through June 25, 2023, it will offer flight credit incentives from $2,500 to $7,500.
Wheels Up Flight Credit Incentives (through June 25, 2023)
|Fund Level||Flight Credit Incentive|
|Core 100||$ 2,500 flight credit|
|Core 200||$ 4,500 flight credit|
|Core 400||$ 7,500 flight credit|
Smith told the Goldman Sachs confab the new strategy in pricing, fleet, and customers are “in the areas we want to win, and we will do so profitability.”
Wheels Up intends to still serve customers in the areas of the country that are not covered by capped hourly pricing via Air Partner.
However, it will price those flights dynamically on a cost plus basis.
Of course, low rates mean nothing if your airplane is delayed.
Competitors wasted no time in targeting Wheels Up after this week’s turmoil.
However, Smith is also promising improvements.
He believes with the smaller capped rate PSA, the concentration of its fleet will mean shorter times for recovery flights when there is a mechanical.
While Wheels Up is still digesting its half-dozen acquisitions, Chairman of Operations Dave Holtz says improvements in performance metrics are already being realized.
Paid subscribers of Private Jet Card Comparisons can compare all levels of the new Wheels Up pricing and policies and request a custom analysis to identify which providers and programs offer the best options based on more than 65 variables.