Spirit Airlines Files for Chapter 11 Bankruptcy Protection

Spirit Airlines, the largest U.S. budget carrier, has filed for Chapter 11 bankruptcy protection due to financial struggles exacerbated by failed merger attempts, the COVID-19 pandemic, and increased competition. The airline has experienced over $2.5 billion in losses since 2020 and faces significant debt obligations due in the coming years. Despite the bankruptcy filing, Spirit plans to continue operations uninterrupted, maintaining flight schedules, and honoring tickets and loyalty points. To restructure its finances, Spirit has arranged for a $350 million equity investment and a debt-to-equity swap with bondholders, aiming to emerge from bankruptcy by early 2025. The bankruptcy process includes steps to strengthen the balance sheet and address operational challenges, such as grounded aircraft due to manufacturing defects. This move, coming just before the busy holiday travel season, aims to secure the airline's future while potentially affecting staff and operations post-holiday.