Just a few hours ago, Spirit execs were saying everything is just fine. At noon yesterday,
Trump was saying that a bailout was still likely. (The first time I read about Trump saying that "we" were going to buy Spirit, I thought he meant him personally, or The Trump Organization. Spirit only needed about $500 million, and Trump could afford that.) That nobody wanted to buy a major airline for $500M means it was a really bad deal and not worth saving.
They were already in Chapter 11 bankruptcy, the "debtor in possession" reorganization mode. Not yet clear if they just went to Chapter 7, liquidation, but that's probably happening within days.
Still, a zero-notice shutdown is a bit much. Some people who have tickets for tomorrow probably went to bed already.
There's still the mechanics of winding down. All the planes have to be flown to suitable storage locations. With such an abrupt shutdown, they'll have mis-positioned aircraft all over their route
system.
Many planes are probably leased, so the lessor may have to arrange to take custody of the aircraft.
It's probably better if the aircraft are leased - there's some lessor with funds to take care of the job and the knowledge of how to arrange it, since a handover and move happens at the end of each aircraft lease.
Aircraft Spirit actually owns will have to be moved by a bankruptcy receiver, which is a lawyer trying to run what's left of an airline.
Most major airports charge very high parking fees. LAX charges $1000 for the first day, and that goes up to $5000 a day on day four. They're not in the storage business.
There are probably a lot of middle of the night phone calls and meetings going on right now.
It’s strange to see so many commenters celebrating the death of a company and the loss of so many jobs.
I flew Spirit a few times. The first time sucked because it was an emergency and I had no other option. The last few flights were great. We got the large seats up front for $75 extra. That plus parking at SJC was still cheaper than flying Southwest out of OAK.
The staff were friendly, and the gate was conveniently across from a lounge, so we had a truly great experience for those couple flights to Dallas.
Low cost carrier. Think Ryanair. Competition from the rest of the market and bad management put them in a bad position, with the most recent war causing unsustainable fuel issues.
Other airlines may be able to double/triple their prices in the short term. Spirit's customers may simply choose to not fly.
Good. They treated their customers terribly and actions have consequences. I was double charged for a flight and they just refused to acknowledge it until I charged back, after which I assume they banned me.
The immediate cause was rising fuel prices. The other issue sounds like it was poorly ran.
More generally, it is also a low cost carrier at a time when, after years of competing on price, airlines are seeing people willing to pay more for a better experience. All other carriers are expanding their premium options, catering to the affluent part of the K economy (for the first time ever the majority of Delta revenue came from premium cabins over main). Meanwhile, Spirit was dealing on the other side of the K who is also most impacted by increasing inflation, etc... giving Spirit zero ability to raise prices.
Airlines are not great business. Margins are not great. Fuel is significant part of their operating costs. And if it goes up too much in too short time the whole model breaks. Less margins you have the more you will be impacted. So if you are operating at edge by default fast move in costs will destroy you.
The business model works fundamentally differently in the US and Europe due to geography. The US is big, meaning that flights are often longer, meaning that fuel is a bigger portion of the operating cost. And fuel is essentially something airlines can’t reduce the cost of compared to other operating costs where it might be possible to optimize for greater efficiency.
Calling Spirit a small regional just betrays the fact that you don't know anything about the airline industry.
You asked if this was caused by or related to bad customer service. This was 100% caused by the increase in jet fuel prices due to the war in Iran. So, once again, you clearly don't follow this area at all and probably shouldn't ask questions about it, especially if you're gonna try to be snarky.
That really sounds line the US is the only country in the world. Considering the world is bigger, I would call Spirit maybe regional, but not small. Ask some europeans, basically no one will know Spirit - as US people may not know e.g. Wizz.
No, that's not what a regional airline is. Many if not most countries have regional airlines. A good example in AU is Qantas vs Qantaslink (the latter being the regional subsidiary).
In the US a regional airline would be something like SkyWest.
It has nothing to do with jingoism or nationalism, but Europeans really will try to get offended about this sort of thing whenever they can lol. It's like if you said United Airlines is a regional airline; it's just factually incorrect, there's nothing more insidious or offensive than that. In this case United is a major carrier. You could try to argue that UnitedExpress is a regional airline, but they have such a large national geographic reach and so many routes/subsidiaries that I'd dispute that. Either way, it isn't about America being 'the only country in the world', it's just about a misunderstanding of what the word means in this context.
This process may seem ugly, but just like biological death is necessary for an ecosystem, this sort of death/restructuring is essential for capitalist economies. Assets and capital get reallocated to better uses. It's all part of the circle of life.
Bankcruptcy and corporate death in general are important. However, the details of how that is managed can vary wildly, and not all implementations are equal.
In this case, the bankcruptcy was handled by cancelling all flights with 1 day of notice. This level of ugliness is not necessary.
Thank God human beings who spend money on these resources are left to fend for themselves. Imagine if we spent good money on a flight, and now the company winds down its operations even as we are on route to our destination. Since we are just a number, I supposed we should simply cease to exist or occupy a liminal space. Or maybe... we could be treated as a human being?
Unfortunately continuing to burn money with no hope of recovery is not a popular strategy among judges and creditor's lawyers. Customers will either get refunds or join the back of the creditor line.
In addition to the human cost that others mention, the big problem is that in our current system, this doesn't lead to fresh blood coming in and being able to compete on an even footing: it leads to the giant incumbents schlorping up the pieces and becoming even bigger and stronger.
Your statement might be true in a system with healthy safeguards ands competition, but that isn't the system we have in the real world today.
Sure, for those not affected by these capitalist decisions, left stranded in the middle of nowhere, or having to look for a new job, while the owner party at their coffy houses.
While it's fair to criticize how this screwed up customers (and perhaps workers), airline shutdowns are often good things, route/airport slots gets freed for example, and airlines with better value (cost or quality wise) can take over.
I don't live in the US but spirit has been the butt of jokes for years.
I am so grateful for this announcement. In a time when gas prices are high, Spirit should be the kind of capitalist example that dominates. Instead, it goes bankrupt despite the President trying to nationalize it. Thanks be to the God of money.
Is this an actual question? I’ll answer it anyway: because they had nothing to do with financial market risk shenanigans and just wanted to get somewhere.
Aviation has stricter laws when it comes to customers. I don't have citations off the top of my head but it's not a normal customer-business relationship.
Also with secured claims. What are they secured against? That is what is the collateral defined. If it is not cash... Well they will get their claims when collateral is liquidated.
can't help but think of the deadweight loss to the US over lack of free market capitalism in terms of bailouts, price supports & subsidies, monopolies, etc. every day we stray further and further from this system we purport to have.
edit: do folks not think more competition would be better for consumers? i'm no stan of capitalism but surely it could be made better, sheesh.
> To our Guests: all flights have been cancelled, and customer service is no longer available
That seems quite a bit stronger than “winding down”!
Still, a zero-notice shutdown is a bit much. Some people who have tickets for tomorrow probably went to bed already.
There's still the mechanics of winding down. All the planes have to be flown to suitable storage locations. With such an abrupt shutdown, they'll have mis-positioned aircraft all over their route system. Many planes are probably leased, so the lessor may have to arrange to take custody of the aircraft. It's probably better if the aircraft are leased - there's some lessor with funds to take care of the job and the knowledge of how to arrange it, since a handover and move happens at the end of each aircraft lease. Aircraft Spirit actually owns will have to be moved by a bankruptcy receiver, which is a lawyer trying to run what's left of an airline. Most major airports charge very high parking fees. LAX charges $1000 for the first day, and that goes up to $5000 a day on day four. They're not in the storage business.
There are probably a lot of middle of the night phone calls and meetings going on right now.
I flew Spirit a few times. The first time sucked because it was an emergency and I had no other option. The last few flights were great. We got the large seats up front for $75 extra. That plus parking at SJC was still cheaper than flying Southwest out of OAK.
The staff were friendly, and the gate was conveniently across from a lounge, so we had a truly great experience for those couple flights to Dallas.
https://www.npr.org/2026/05/02/nx-s1-5807933/spirit-airlines... describes this in more detail.
More generally, it is also a low cost carrier at a time when, after years of competing on price, airlines are seeing people willing to pay more for a better experience. All other carriers are expanding their premium options, catering to the affluent part of the K economy (for the first time ever the majority of Delta revenue came from premium cabins over main). Meanwhile, Spirit was dealing on the other side of the K who is also most impacted by increasing inflation, etc... giving Spirit zero ability to raise prices.
Ryanair's gross profit margin for fiscal years ending March 2021 to 2025 averaged 19.1%.
Some are (were?) doing just fine - in Europe at least.
Sure, it's no Big Tech or banking, but it's not like the single low digit percentage of eg retail.
Perhaps some USA airlines need some advice from across the pond?
You asked if this was caused by or related to bad customer service. This was 100% caused by the increase in jet fuel prices due to the war in Iran. So, once again, you clearly don't follow this area at all and probably shouldn't ask questions about it, especially if you're gonna try to be snarky.
In the US a regional airline would be something like SkyWest.
It has nothing to do with jingoism or nationalism, but Europeans really will try to get offended about this sort of thing whenever they can lol. It's like if you said United Airlines is a regional airline; it's just factually incorrect, there's nothing more insidious or offensive than that. In this case United is a major carrier. You could try to argue that UnitedExpress is a regional airline, but they have such a large national geographic reach and so many routes/subsidiaries that I'd dispute that. Either way, it isn't about America being 'the only country in the world', it's just about a misunderstanding of what the word means in this context.
In this case, the bankcruptcy was handled by cancelling all flights with 1 day of notice. This level of ugliness is not necessary.
Sure.
Can you expand on this? How do you explain e.g. ecosystems around centuries-old redwoods?
https://en.wikipedia.org/wiki/Sequoia_sempervirens#Fire_adap...
Your statement might be true in a system with healthy safeguards ands competition, but that isn't the system we have in the real world today.
The capital will probably go to further the AI bubble, I really don't see how that would be more useful than enabling travel.
I don't live in the US but spirit has been the butt of jokes for years.
EDIT: 14 CFR Part 260.
The laws around bankruptcy define the priority of who gets paid and in what order:
- Secured Claims
- Unsecured Priority Claims
- Unsecured Non-Priority Claims (General Unsecured)
- Equity Security Interests
Each layer has to be paid in full before the next layer.
Unsecured Priority Claims - this includes customers who have paid for services.
The market should decide and determines winners and losers, not the government.
So compete.
That being said, I suspect many people had never heard about Lehman Brothers before 2008...
edit: do folks not think more competition would be better for consumers? i'm no stan of capitalism but surely it could be made better, sheesh.