Spirit Airlines, one of the largest budget airlines in the United States, today announced that it has filed for Chapter 11 bankruptcy protection.
The company is following in the footsteps of American Airlines, which took a similar step more than a decade ago. With flights to 47 domestic destinations and 28 international destinations, including popular locations in the Caribbean and Latin America, the airline remains operational despite financial troubles. The Chapter 11 filing was filed in Bankruptcy Court for the Southern District of New York.
Court documents show that Spirit Airlines estimates its assets and liabilities to be worth between €930 million and €9,3 billion, depending on the exchange rate. The process will allow the company to restructure its debt while continuing its daily operations.
securing operations
Spirit Airlines has reached a pre-agreed agreement with bondholders, which includes a credit line of 279 million euros. This financing should ensure that the airline can continue its operations and maintain customer confidence. The company expects to complete the restructuring in the first quarter of 2025 and emerge stronger from the process.
According to the airline, the move will reduce its overall debt and increase financial flexibility. In an open letter to customers, Spirit Airlines emphasized that existing tickets, loyalty points and club benefits will remain valid. “Our great team members are ready to provide you with excellent service. We remain committed to improving your travel experience,” the statement said.
The decision to file for bankruptcy protection comes after a series of setbacks. Spirit Airlines has been struggling with persistent quarterly losses and large debt payments for some time. Attempts to turn the tide through mergers with Frontier Airlines and JetBlue Airways have failed. These failed negotiations, combined with rising operating costs and a challenging economic environment, have led to the current situation.
In addition, plans to raise additional capital through staff cuts and aircraft sales have failed, forcing the company to take drastic measures, including delaying Airbus orders and laying off pilots.
outlook
In its letter to customers, Spirit Airlines tries to maintain confidence. “We want to assure you that you can continue to book and fly now and in the future,” the company writes. Spirit Airlines emphasizes that other airlines, such as Delta Air Lines and United Airlines, have successfully gone through similar restructuring processes in the past. The company is determined to emerge stronger from this period and maintain a competitive position in the ultra-low-cost airline sector.
However, the airline will be delisted from the New York Stock Exchange, further underscoring the financial uncertainty. Still, Spirit remains optimistic and is focused on a future where it can offer customers more value and improved services.
