Spirit Airlines has made a deal with most its lenders that it says should allow it to emerge from bankruptcy sometime early this summer. If successful, it would lead to a much smaller airline with focused operations at four airports, including its home base of the Fort Lauderdale-Hollywood International Airport.
The South Florida-based airline declared bankruptcy last August for the second time in under a year. It has remained operating during its bankruptcy reorganization.
The airline’s plan is to continue auctioning off planes and not renewing leases in order to reduce its fleet. It expects to have about a third of the number of planes this summer compared to a year earlier. It reduced its network last year by cutting 200 routes while it cut costs and furloughed employees.
The company has called back hundreds of pilots and flight attendants it furloughed over the past two years to replace employees who have left the airline while it's in bankruptcy. Spirit ended last year with 9,700 employees, down almost 20% from the previous year.
Spirit expects its fleet will be further reduced as it works toward coming out of bankruptcy. It plans on having no more than 80 planes, down from 131 at the end of last year. Two years ago, Spirit was flying over 200 planes. Shrinking the number of planes it owns or leases will reduce the airline's fixed cost structure. It hopes to add more planes through the end of this decade “commensurate with profitable growth opportunities.”
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“The smaller airline minimizes operating cash requirements, improves margins and significantly reduces aircraft debt,” the company wrote in “Project Soar,” the title of Spirit’s post-bankruptcy plan.
Revenue dropped 23% last year to $3.8 billion. Coupled with a similar fall-off in expenses, Spirit narrowed its operating loss for the year. It lost $768 million, an improvement from more than $1 billion in losses in 2024. Spirit has not had an annual operating profit for several years.
Spirit projects it will return to an operating profit next year. The airline predicts $55 million in net income in 2027. It expects to carry about $2 billion in debt when it emerges, down from more than $7 billion before it filed for protection.
One unknown is the price of jet fuel. Spirit’s financial forecast expects its fuel cost to drop throughout this year and be stable next year. The U.S.-Israel military action in Iran has pushed crude oil prices up to around $100 a barrel. Jet fuel prices have spiked and the longer they stay elevated the more they impact the airline industry. Fuel is one of the largest expenses for an airline after labor costs.
Spirit was responsible for one out of every four flights in January at FLL, making it the largest carrier. However, it saw its Fort Lauderdale passenger count fall 13%. The only other carrier to experience a drop in passengers in January through FLL was Air Canada.
