Spirit Airlines Officially Files for Chapter 11 Bankruptcy, Says Operations Will Continue

After rumors last week that the news was imminent, Spirit Airlines officially filed for Chapter 11 bankruptcy protection on Monday in the U.S. Bankruptcy Court for the Southern District of New York. The move makes Spirit the first major U.S. airline to file for bankruptcy since American Airlines in 2013.

In a letter to customers, Spirit called the move a “proactive step” to position the airline for future success. Spirit said all operations would continue as normal, including honoring all tickets, credits, and loyalty points.

“We’re grateful you continue to choose Spirit for your travel needs. As we head into the holiday season and beyond, we look forward to welcoming you on board again soon,” Christie said in the letter.

Spirit reached agreements with its bondholders for $300 million in debtor-in-possession financing, $350 million in equity, and a plan to equitize $795 million in debt. It expects to emerge from bankruptcy by the first quarter of next year.

The Florida-based airline has faced mounting challenges, including an engine recall grounding dozens of jets, rising costs after the pandemic, and increased competition driving down fares.

The airline had attempted two mergers in recent years in order to to secure its future. Its planned acquisition by JetBlue was terminated in March 2024, after being blocked by a federal judge on antitrust grounds. A proposed merger with Frontier Airlines also failed.

According to its annual reports, Spirit has not posted a net profit since 2019, despite growing its passenger numbers, fleet, and workforce. Other low-cost carriers, like Frontier, have managed to grow earnings and revenue over that same period.