Well, it finally happened. They begged for the help. When the help didn’t come, the writing was on the wall. And like that, Spirit Airlines is done. Kaput!!!!
They will shut down as a business after failing to secure a $500 million bailout from the Trump administration. The budget airline was in talks with the US government about a rescue deal, which would have saved it from collapse.
Unfortunately, the discussions collapsed, and the carrier announced on its website that with “great disappointment” the airline had “started an orderly wind-down of our operations, effective immediately”.
Spirit was trying to navigate through a second bankruptcy filing in recent years. But then came the US-Israel war in Iran, resulting in a surge in jet fuel costs that pushed them over the brink. Fuel costs can make up as much as 40% of an airline’s outgoings, and airlines have seen the cost of jet fuel double since the US and Israeli strikes began at the end of February.
The truly bad news is for the Spirit customers, as upcoming flights have been cancelled. The airline said it would automatically process refunds for any flights purchased through Spirit with a credit or debit card to the original form of payment, and guests who booked flights via a travel agent should contact the travel agent directly to request a refund.
Compensation for those who booked flights using a voucher, credit, airline points or any other method will be determined at a later date through the bankruptcy court process.
Spirit’s customer service is no longer available, but customers with questions can contact the carrier’s claims agent. The airline’s demise was so abrupt that it has left some ticket holders in the lurch.
Spirit had been in the process of making the changes it needed in its current bankruptcy process, scaling back the number of flights it was offering and aircraft it owned, but its ability to survive the year was in question even before the Iran war.
At the end of April, Spirit was confident that its rescue deal with the Trump administration was to be finalized imminently. But after that deal fell through, Trump said that the airline had been offered “a final proposal” to keep it in business.
The earlier plan, which would have seen the US government take effective ownership of as much as 90% of the airline, faced stiff opposition from Wall Street, Capitol Hill, and even a member of Trump’s own cabinet. Transportation Secretary Sean Duffy told Reuters a rescue would amount to tossing “good money after bad”.
And for what it’s worth, the government is going to do its best to help Spirit customers to not get totally “f*cked” by all of this. Duffy announced a series of measures to help Spirit Airlines customers who have been screwed. The policies would allow stranded customers to rebook tickets with other carriers at capped or reduced prices.
“We’ve activated our airline partners to ensure passengers are not stranded, communities maintain route access, fares do not skyrocket, and Spirit’s workforce is connected to new job opportunities,” Duffy said.
Spirit ticketholders can provide proof of purchase to qualify for special prices aboard JetBlue, Southwest, Delta, and United. The carriers are making the prices available for various time periods. But ticket-holders should hurry, with some offers expiring in three days.
Carriers are offering “spare jump seats” to Spirit pilots and flight attendants who are stuck away from home. The 34-year-old budget airline is the first US airline to fail for financial reasons in 25 years.
