Five months after emerging from Chapter 11 bankruptcy protection, Spirit Airlines — via parent company Spirit Aviation Holdings, Inc. — is again turning to the restructuring vehicle as it ‘doubles down’ on efforts to address costs, redesign its network and optimize its fleet.
The struggling US low-cost carrier, which in mid-August issued a ‘going concern’ warning as part of a routine financial filing for investors, says in a 29 August statement that it has filed voluntary petitions for Chapter 11 in the U.S. Bankruptcy Court for the Southern District of New York.
Today, Spirit took a proactive step to build a stronger foundation and future for our company. We have voluntarily entered the Chapter 11 restructuring process to ensure the long-term success of our airline.
Chapter 11 is a court-supervised legal process that allows companies to restructure their businesses while continuing operations. Virtually every major U.S. airline has used these tools to improve their businesses and position them for long-term success.
Spirit stresses that it will “continue to operate normally” during the restructuring process.
The airline had previously hoped to be acquired by and merge with JetBlue Airways, but the Justice Department thwarted the move. In January 2024, the U.S. District Court for the District of Massachusetts formally blocked the transaction saying it violated “the core principle of antitrust law: to protect the United States’ markets — and its market participants — from anticompetitive harm.” Spirit entered Chapter 11 bankruptcy protection in November 2024 and exited in March 2025.
“Since emerging from our previous restructuring, which was targeted exclusively on reducing Spirit’s funded debt and raising equity capital, it has become clear that there is much more work to be done and many more tools are available to best position Spirit for the future,” says company president and CEO Dave Davis.
“After thoroughly evaluating our options and considering recent events and the market pressures facing our industry, our Board of Directors decided that a court-supervised process is the best path forward to make the changes needed to ensure our long-term success. We have evaluated every corner of our business and are proceeding with a comprehensive approach in which we will be far more strategic about our fleet, markets and opportunities in order to best serve our guests, team members and other stakeholders.”
As part of its restructuring, Spirit will redesign its network, including providing more destinations, frequencies and enhanced connectivity to its focus cities, whilst also reducing its presence in certain markets.
Additionally, Spirit says it intends to “rightsize its fleet to match capacity with profitable demand in line with the redesigned network.” It has been actively engaged with some of its largest lessors, secured noteholders and key stakeholders, with the aim of significantly lowering debt and lease obligations.
To further address its cost structure, Spirit says it will be seeking further “efficiencies” across the business.
In the United States, several airlines are bolstering their premium propositions, and Spirit, traditionally a no-frills carrier, is no exception. The airline now offers three travel options — Spirit First, Premium Economy (a blocked middle seat offering) and Value.
It believes it can stay true to its original mission of making travel more accessible for everyone whilst ensuring its guests have the freedom to choose premium options.
Related Articles:
- Spirit issues ‘going concern’ warning, capping painful period
- Spirit Wi-Fi impresses in nearly every way, except price
- Spirit serves up blocked middle and Go Big fare bundles
Featured image credited to Mary Kirby
