Spirit Airlines Files Chapter 11 Bankruptcy Again, Continues Operations Amid Financial Restructuring

Spirit Airlines has filed for Chapter 11 bankruptcy protection for the second time within a year, citing ongoing financial struggles despite a prior debt restructuring that reduced liabilities by about $800 million. The airline continues to operate normally, maintaining flights, ticket sales, and employee payments during the restructuring process. CEO Dave Davis emphasized that more comprehensive restructuring efforts are needed to rightsize the fleet, reorganize routes, and reduce operational costs, as the company faces a cash crunch and mounting losses totaling approximately $246 million in the most recent quarter. Operating expenses remain high, reaching $1.2 billion, which has hampered Spirit's efforts to stabilize financially. The airline’s stock plummeted nearly 47% following the bankruptcy announcement, with concerns about its NYSE listing potentially ending and shares possibly becoming worthless. Industry analysts note that Spirit’s failure to fix its inflated cost structure during the first bankruptcy contributed significantly to its ongoing difficulties, while competitors like Frontier and Southwest may benefit from Spirit’s weakened position.