Spirit Airlines Files for Bankruptcy Amid Financial Struggles

US budget airline Spirit Airlines has filed for bankruptcy protection, citing prolonged financial losses and failed merger attempts. The Florida-based carrier announced on Monday that it has secured an agreement to restructure its debt and raise funds during a Chapter 11 bankruptcy process, expected to conclude by early 2025.

Spirit assured customers that its operations will continue as normal throughout the process, with no impact on passenger travel, employee wages, or payments to aircraft leasing firms.

This marks the first bankruptcy filing by a US airline in over a decade, with the last major case being American Airlines’ 2011 filing to address labor costs and high fuel prices. Spirit, however, has faced unique challenges, including intensified competition in the budget travel sector and engine-related mechanical issues that have grounded aircraft and increased operating expenses.

The airline has not posted a full-year profit since the onset of the COVID-19 pandemic and reported losses of approximately $360 million (£285 million) in the first half of 2024, despite strong demand for budget travel.

As part of its restructuring, Spirit will be delisted from the New York Stock Exchange in the near future, and its stock shares will be canceled without value.

The airline remains optimistic that the Chapter 11 process will help it emerge more financially stable, ensuring continued service to its customers and support for its employees.