Liquidity

6 Months Ended

Jun. 30, 2023

Text Block [Abstract]

Liquidity and Management's Plan, COVID-19

2. Liquidity

The Company’s ability to meet its liquidity needs is dependent upon its cash, cash equivalents and marketable securities balances and its ability to generate cash flows from operations in the future in amounts sufficient to meet its obligations and repay its liabilities arising from normal business operations when they come due. The Company currently believes its available working capital and anticipated cash flows from operations will be sufficient to meet the Company’s liquidity requirements for at least the next 12 months from the date of this filing. However, there can be no assurance that the Company will be able to generate sufficient cash flows from operations, or that additional funds will be available, to meet its future liquidity needs, particularly if Air Wisconsin receives an adverse determination in the arbitration with United.

Reduced Block Hours

Since the beginning of the COVID-19 pandemic, Air Wisconsin has experienced significantly reduced block hours relative to historical levels, both as a result of the pandemic and the prevailing industry-wide pilot shortage. Although the disruption in passenger demand due to the pandemic has largely subsided, the pilot shortage is expected to continue for the foreseeable future and is currently the leading factor preventing Air Wisconsin from consistently achieving block hours in line with pre-pandemic levels.

In addition, Air Wisconsin’s block hours have been temporarily reduced as a result of the transition from flying for United to flying for American. Before any Air Wisconsin aircraft was available to operate flights for American, that aircraft had to be removed from service under the United capacity purchase agreement, painted to meet the livery requirements of the American capacity purchase agreement and otherwise modified to meet such requirements. During the period from the withdrawal of an aircraft from service under the United capacity purchase agreement until it is placed into service under the American capacity purchase agreement, that aircraft did not generate revenues from either United or American. As of June 30, 2023, Air Wisconsin had 32 aircraft in service for American under the American capacity purchase agreement.

For additional information, refer to Part I, Item 1, “Business—American Capacity Purchase Agreement” within the 2022 Annual Report.