Spirit Airlines nears deal for US government rescue

The Trump administration has neared a rescue package for Spirit Airlines.
The agreement has included up to $500m in financing.
The US government has received warrants for up to 90pc ownership.
Spirit Airlines has faced challenges from recent fuel price increases.
The carrier has continued operations under its second Chapter 11 procedure.

The Trump administration has neared a rescue package for Spirit Airlines that could give the US government the option to own as much as 90pc of the carrier. The agreement has offered as much as $500m in financing in exchange for warrants to purchase up to 90pc of the new entity. Spirit Airlines has operated under Chapter 11 bankruptcy with recent fuel price rises that have pushed it toward liquidation.

The ultra-low-cost carrier has generated around 14,000 jobs including at third-party companies. President Donald Trump has expressed concern over the possibility that Spirit could go out of business. The deal has involved discussions led by Commerce Secretary Howard Lutnick and Transportation Secretary Sean Duffy.

Spirit has previously reached an agreement with creditors to reduce debt and trim its Airbus fleet from over 200 aircraft to 75 to 80 narrowbodies. The rise in fuel prices has derailed the exit from bankruptcy scheduled for summer 2026. The current administration has criticised the previous decision that blocked the merger with JetBlue Airways.

White House spokesman Kush Desai shared “Spirit Airlines would be on a much firmer financial footing had the Biden administration not recklessly blocked the airline’s merger with JetBlue.”

President Donald Trump shared “Maybe the federal government should help that one out.”