Delta is partnering with a private-jet startup, and the move reveals how the airline giant is looking to cash in by investing in unexpected spaces

Delta Private Jets

Delta Air Lines said on Thursday that it would take a minority stake in private jet startup Wheels Up, establishing a partnership that would create one of the world's largest fleet of corporate aircraft.

The partnership will see Delta Private Jets - a wholly owned subsidiary of Delta that focuses on charter operations - effectively combine with Wheels Up. Together, the Delta-Wheels Up entity will operate a fleet of around 190 private planes with more than 8,000 customers, Delta said in a statement.

Wheels Up provides a range of services offering access to private jets, including seats on empty legs - where a jet would otherwise fly empty from dropping off its last passenger to picking up its second - shared charters, and private charters with guaranteed availability with 24-hours notice.

Delta Private Jets is a private-jet charter service that functions separately from the commercial airline. Its fleet ranges from short-range light jets to longer range Gulfstreams. Delta announced a program in 2015 offering access to inexpensive private jet upgrades, but when the jet was scheduled to fly an empty leg, it was unclear whether that ever actually happened.

"This groundbreaking partnership will democratize private aviation - making the convenience of private-jet travel accessible to more consumers," Delta CEO Ed Bastian said in a statement. "Wheels Up's lifestyle experiences and innovative digital platform, combined with the scale and service of Delta Private Jets, helps further Delta's mission of connecting people and communities worldwide through travel."

"This agreement is the latest step in Delta's ongoing effort to build partnerships that extend Delta's brand beyond its core business," Bastian added.

In recent years, Delta has aggressively invested outside of its core US commercial aviation market, which is relatively mature. It has acquired minority stakes in a variety of international airlines, such as AeroMexico, Virgin Atlantic, Korean Air, China Eastern, and most recently, LATAM.

The investment in its private aviation business, and the acquisition of Wheels Up, suggests an effort to continue its streak of positive financial results by looking outside of its typical wheelhouse. The diversified investments could present Delta an opportunity to achieve high growth even if the US airline market lags.

"It's a way for us to extend our brand and extend our ability into a new space," Bastian said about the deal on CNBC's Squwak Box.

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