I can’t say that I’m surprised to hear this, though it certainly counters the narrative we’ve heard in recent weeks.
In this post:
Spirit Airlines reportedly may be days from liquidation
Bloomberg reports that Spirit Airlines could liquidate as early as this week, according to people familiar with the matter, who spoke on the condition of anonymity. For context, Spirit is currently in Chapter 11 bankruptcy, which it has now entered into twice within the past couple of years.
The ultra low cost carrier has had a very rough several years, as it has lost billions of dollars since the start of the pandemic, as the industry has evolved, and as it has gone through a failed merger with JetBlue.
As recently as mid-March 2026, Spirit insisted that it was planning on emerging from Chapter 11 bankruptcy in the coming months, by early summer. Even before the massive spike in oil prices, I couldn’t really make sense of that plan, since Spirit’s margins are among the worst in the industry, based on what we know, and that’s before factoring in the impact of a hike in fuel prices.
For that matter, Spirit’s turnaround plan is basically to shrink into profitability, which isn’t a great strategy when you’re trying to compete on cost (since growth contributes to better unit costs).
So we’ll see how this plays out, but liquidating within days is a very different narrative than emerging from bankruptcy shortly. I imagine that Spirit’s plan to emerge from bankruptcy was marginal at best, and high oil prices certainly don’t help.
While it’s entirely possible the airline doesn’t liquidate in the coming days, the fact that a reliable media source is reporting that it could happen within days suggests to me that it’s likely imminent. In fairness, we’ve heard rumors of Spirit liquidation before.
It would be sad to see Spirit disappear, but…
Fundamentally the US airline industry is kind of backwards, when you consider that the successful airlines aren’t those that fly passengers with good margins, but instead, the airlines that successfully cash in on their loyalty programs.
Spirit has for so long gotten the short end of the stick, and has had an unfairly negative reputation, when for the most part it has very friendly staff. I hate the thought of anyone losing their livelihood. That being said:
- Spirit just doesn’t have a business model that works in 2026, and keeping an uncompetitive airline alive only works for so long
- If Spirit goes out of business, at least it maybe improves the prospects of some other airlines, like JetBlue, staying in business, given their overlapping markets (and JetBlue could use some help right now)
In hindsight, it’s easy to look at Spirit and say “ugh, it shouldn’t have all happened that way.” But alas, this is where we are, and we have to be realistic about the situation.
Bottom line
While we’ll see what comes of this, reports suggest that Spirit Airlines could be just days (or hours) from liquidating, as it grapples with the reality of the current oil price situation. Spirit is currently in Chapter 11 bankruptcy (for the second time in a short period), and while the plan has been to emerge from bankruptcy in early summer, the Iran situation threw a wrench in that (and I question how realistic the plan was in the first place).
What do you make of the prospects of Spirit shutting down?
Hopefully they do survive, because less competition is bad for consumers and workers alike.
(The haters on here are ignorant.)
Good riddance.
Although perhaps not your choice of carrier, they did serve a market segment and helped keep prices lower.
Lufthansa Cityline was liquidated an hour ago or so…
Liquidation probably isn't the right term here. Lufthansa Cityline is being shut down, but presumably its assets will be reabsorbed by Lufthansa, either for itself or for one of its other subsidiaries. I would be surprised if those assets were sold off to appease creditors, which is what "liquidate" means.
Thanks for the clarification. You are most likely correct.
Interesting move from Lufthansa Group: the flight attendant union seems to be pretty pissed, so let’s see if mainline will just continue to strike.
It will be sad to see one of the best generators of police body camera videos go.
Yeah, I'm hoping Frontier will be able to successfully fill the void.
OPD (Orlando) is going to have to lay off some cops.
Unemployment and misery ahead for staff and high tickets for the rest of us. Thanks a lot Biden DOJ. It will be decades before we recover that disaster presidency.
Spirit can blame JetBlue for its demise. The idiotic attempts by B6 to disrupt the planned NK/F9 merger announced in February 2022 scuttled both F9 and NK's survival in an environment where the US3 have made ULCCs uncompetitive and marginal businesses. NK's pilots and mechanics will likely find jobs at other carriers who will pick up their jets. Sad to see employees lose their jobs.
that is true. and the irony is that B6 will likely follow NK into chapter 11. B6' outcome might be as the acquired rather than liquidated but there is no place for trying to do something out of spite or to engage in cowboy tactics
And all pilots, whether at freight-only, or passenger+freight or passenger-only, carriers, will necessarily, predictably, and unfairly be stapled at the bottom of the all-important-Godlike seniority list...
Boo hoo.
If a business can't make enough revenue to cover it's cost of operations it won't stay in business. Despite what Bernie Sanders and Elizabeth Warren want you to believe.
Other airlines have found a golden goose with credit card income. Without that there'd be far fewer planes and people in operation because they'd have to make a profit flying people from Point A to Point B. If the goose ever dies it's going to be...
If a business can't make enough revenue to cover it's cost of operations it won't stay in business. Despite what Bernie Sanders and Elizabeth Warren want you to believe.
Other airlines have found a golden goose with credit card income. Without that there'd be far fewer planes and people in operation because they'd have to make a profit flying people from Point A to Point B. If the goose ever dies it's going to be a dark day for many employed in the aviation industry.
ULCCs have no golden goose and ancillary fees are not enough to make up for lost money on fares. If oil prices stay elevated for a period of time the future of Frontier and Jetblue is also questionable.
Trump nearly doubled the cost of jet fuel but let's blame New England Democrats here.
Spirit going into bankruptcy had nothing to do with Trump. The business model was cooked even before Trump's moronic decision to do what Israel wanted. There's intellectual thinking, then there's TDS.
When we say
‘Successfully cash in on passengers with frequent flyer programs” - can we just acknowledge that it’s actually extorting interchange fees from sellers?
The US model wouldn't work in most of the world where fees are capped. But we have no other way to make the economics work for an overpaid union labor force except to use credit card fees to subsidize them.
Would be sad to see Spirit go, for sure. It should've been Frontier
word...
Agreed. I found the Spirit team to be much more professional and overall happier than Frontier’s team.
Bankruptcy and restructuring partners at top law firms are salivating right now.
If I were an associate at one of these firms, I’d be shopping on Amazon for sleeping bags. I’d be putting my Hinge on pause. I’d be getting ready to bill 500 hours in a month (the record set by an associate at Paul Weiss).
This was posted on Reddit earlier - someone caught a large number of Spirit flights with NK9*** flight numbers heading to Victorville (VCV) this week.
https://www.reddit.com/r/flightradar24/comments/1sm9s8t/i_dont_think_sprit_airlines_is_doing_too_well/
@ BrGr -- Interesting, though in fairness, they were going to downsize their fleet considerably anyway, so that might have been in the cards before this latest development. For that matter, I suppose it's logical that the spike in oil prices is causing some planes to be grounded (though it may soon be a whole airline!).
I'm booked on a flight to Florida in June. What are the chances that the airline would be around?
I have a flight with them tomorrow. Short flight - Burbank to Las Vegas.
If they cancel all flights, what are my options?
@ Boardingareaflukie -- Hopefully you're still good on such short notice. If your flight is canceled, you'll of course want to dispute the charge for the flight. In theory some airlines may offer special fares to Spirit customers, though I wouldn't count on it, given the complexity of such a program. If that doesn't happen, your only option would be to book a ticket on another airline.
Drive
a doubling of fuel prices will do it.
There will be a thinning of the herd. some carriers will slip into chapter 11 while others will be in a position to pick up assets.
NK just doesn't have much left of value but other carriers do.
If they did liquidate, what would happen to peoples "Free Spirit" miles? Would they evaporate into the ether, or would another airline pick them up?
@ DaveVail -- They would likely evaporate, sadly... some other airlines might have status match promotions, but I wouldn't expect much more than that.
Per contract of carriage and T&C of Free Spirit, Spirit owns the miles/points and "licenses" them to you. So you don't own them. They don't have an explicit cash value and cannot be transferred by operation of law. So you have basically no claim on them.
They are legally not a debt, they are more of a contractual obligation to offer you some services in the future. But that obligation disappears with the company.
...Per contract of carriage and T&C of Free Spirit, Spirit owns the miles/points and "licenses" them to you. So you don't own them. They don't have an explicit cash value and cannot be transferred by operation of law. So you have basically no claim on them.
They are legally not a debt, they are more of a contractual obligation to offer you some services in the future. But that obligation disappears with the company.
Don't hold big balances at any airline and make sure balance is 0 at airlines that don't have a secure future. As much as airlines want to make miles look like an alternative to cash they really are not.
This is like the 10th time this has been speculated in the last two years.
If so, no one should celebrate this at all. We would lose options; consolidation doesn’t help consumers or workers.
I feel most for the workers; pilots and maintenance will get scooped up quickly. The rest would need support at a time where our safety nets are being ripped away.
Safety nets don’t exist in the US because of Republicans.
What safety net do you propose? We the taxpayers cover Spirit's losses so that people can have cheap tickets? You really need to stop listening to Bernie Sanders and Elizabeth Warren. No business should be bailed out that can't cover their costs. That's called a failure. Yeah, the workers get hosed but it's not like they did not know this was a real possibility.
@Ben Who is likely to scoop up their aircraft?
@ johhny -- That's a great question! With current oil prices, I suspect no one. :p Of course we'll see how that situation evolves. Bigger picture, Spirit was already going to return most of its next generation A320neo-family aircraft to leasing companies, and focus on keeping previous generation aircraft. I imagine that at least among US airlines, that might limit interest.
Are those sources: Scott Kirby and his team? ha.
Oh well. I flew them three times in their Big seat. Great value. Lovely check-in and gate staff, amazing FA's and really good customer service. No gate or onboard fighting at all.
Even if you never flew them, this airline kept fares lower across the board. Watch what happens next.
United can pick up their narrowbodies and fly them to Inverness and Marseille
RIP Spirit!! Too bad the JetBlue/Spirit merger was axed.
It's the Bidenomics that killed it! What a terrible senile president he was. Now thousands of people will lose their jobs
Since President Trump is known to love having Americans well paid in the civilian sector, I think this is way UA leadership was feeling out the President about an AA merger.
An AA UA merger virtually guarantees longer term employment under generous AFA packages for the two airlines work groups which have gone through so much since the 9/11 attacks.
Who doesn’t want to insure AA and UA and their employees have success and solid...
Since President Trump is known to love having Americans well paid in the civilian sector, I think this is way UA leadership was feeling out the President about an AA merger.
An AA UA merger virtually guarantees longer term employment under generous AFA packages for the two airlines work groups which have gone through so much since the 9/11 attacks.
Who doesn’t want to insure AA and UA and their employees have success and solid retiree benefits after being the Chosen Instruments of the evil of Islamic Terrorism.
Still blaming Biden? How sad.
Projection much? Look at the creature you morons elected now.
Had they merged, the debt buying Spirit would have taken JetBlue down with them.
100% agreed.