Spirit Airlines is considering a Chapter 11 bankruptcy filing following a failed merger with JetBlue and ongoing financial difficulties, as reported by the Wall Street Journal.
The budget carrier is negotiating with bondholders about a potential restructuring deal and has shifted focus toward securing support for a Chapter 11 filing, with no set timeline for action.
With losses, declining revenues, and a significant debt of $3.3bn and losses of which $1.1bn in secured bonds is maturing soon—Spirit is under pressure to refinance or extend these notes by October 21.
Operational challenges have led to route cuts and plans to reduce capacity by nearly 20% in late 2024, alongside furloughing 186 pilots as part of cost-cutting measures amidst the recall of Pratt & Whitney engines.
