On August 29, Spirit Airlines’ parent company, Spirit Aviation Holdings Inc., announced that it filed for Chapter 11 bankruptcy for the second time within a year.
According to the company, it filed its latest Chapter 11 bankruptcy through the United States Bankruptcy Court for the Southern District of New York. The popular low-budget airline is still trying to bounce back post-COVID, which was rough on the aviation and air travel industries, as well as several failed mergers in recent years. Additionally, Spirit Airlines filed for Chapter 11 bankruptcy in November 2024 and emerged from that restructuring process in March of this year.
The company’s restructuring plans include shrinking its fleet, cutting costs, and adding more premium travel options.
What Else Is There To Know About Spirit Airlines’ Bankruptcy?
In the August 29 statement about its latest bankruptcy filing, the company said the latest restructuring is an effort to transition toward a “sustainable future.” Also, it believes “the Chapter 11 process will provide Spirit the tools, time, and flexibility to continue ongoing discussions with all of its lessors, financial creditors, and other parties to implement a financial and operational transformation of the company.”
The carrier’s travelers should know that, as of now, nothing much will change on their end. Spirit Airlines’ ticket sales, flights, loyalty point system, and operations will continue as normal. The press release noted the restructuring will cut flights in some markets while boosting connectivity in key ones.
In mid-August, Spirit Airlines’ quarterly earnings report revealed that leadership was uncertain about the company’s vitality even through another year. In July, the carrier announced plans to downsize, including a reduced pilot force.
The company’s president and chief executive officer, Dave Davis, addressed the latest bankruptcy filing in the August 29 press release.
“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,” Davis said in part.
“As we move forward, guests can continue to rely on Spirit to provide high-value travel options and connect them with the people and places that matter most,” he added.
