Spirit Airlines files for bankruptcy amid mounting losses

U.S. budget airline Spirit Airlines has filed for bankruptcy protection and will try to reboot operations, the Associated Press reported Monday (Nov. 18).

Spirit has lost more than $2.5 billion since the start of 2020, the year the pandemic hit, and faces long-standing debt payments totaling more than $1 billion over the next year, reports say.

The airline is expecting to operate as normal as it works its way through a prearranged Chapter 11 bankruptcy process, saying that customers can continue to book and fly without interruption.

All tickets, credits and loyalty points remain valid, the airline said, as are affiliated credit cards and other membership perks.

Shares of Spirit Airlines Inc., which is based in Miramar, Florida, dropped 25 per cent on Friday, after The Wall Street Journal reported that the airline was discussing terms of a possible bankruptcy filing with its bondholders.

JetBlue inked a deal to acquire Spirit in July of 2022 for US$3.8 billion, a transaction that would have created the U.S.'s fifth largest airline.

In the end, the merger was blocked by a U.S. judge, saying it would drive up prices.

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