Spirit Airlines files for bankruptcy for 2nd time in less than a year
Spirit Airlines announced that it has voluntarily filed for Chapter 11 bankruptcy -- marking the second time the budget airline has filed for bankruptcy in less than a year.
"Since emerging from our previous restructuring, which was targeted exclusively on reducing Spirit's funded debt and raising equity capital, it has become clear that there is much more work to be done and many more tools are available to best position Spirit for the future," Spirit President and Chief Executive Officer Dave Davis said in a statement on Friday. "After thoroughly evaluating our options and considering recent events and the market pressures facing our industry, our Board of Directors decided that a court-supervised process is the best path forward to make the changes needed to ensure our long-term success."
"We have evaluated every corner of our business and are proceeding with a comprehensive approach in which we will be far more strategic about our fleet, markets and opportunities in order to best serve our Guests, Team Members and other stakeholders," the statement continued.
The airline said there will be no impact to Labor Day travel as flights will continue to operate normally and customers can still use their tickets, credits and loyalty points.
Spirit said it will use this process to implement a financial and operational transformation to redesign its network, optimize its fleet, address its cost structure and realign its strategy to effectively compete and meet evolving consumer preferences.
The Florida-based budget airline previously filed for Chapter 11 bankruptcy protection in November 2024, months after a federal judge blocked its proposed merger with JetBlue.
In a quarterly filing with the Securities and Exchange Commission earlier this month, its parent company, Spirit Aviation Holdings, stated that Spirit has "substantial doubt" about its ability to continue or sustain operations as it has struggled to regain profitability.
Per the filing, Spirit needs more cash or the airline could be at risk of potential default to creditors. The airline said it is considering options including selling off aircraft, real estate or some airport gate spots.
ABC News' Kelly McCarthy contributed to this report.
