By Tom Ozimek
Budget carrier Spirit Airlines said Saturday it will halt all operations immediately, canceling all flights and beginning an orderly wind-down after a last-minute rescue plan failed to get traction.
“It is with great disappointment that on May 2, 2026, Spirit Airlines started an orderly wind-down of our operations,” the company said in an announcement, adding that all flights are canceled and customer service is being discontinued.
The Florida-based airline said passengers should not go to the airport and that refunds will be issued automatically for tickets purchased by card.
The shutdown follows months of restructuring efforts, as the company struggled with mounting financial pressures and a sharp rise in fuel costs that undermined its path out of bankruptcy.
“In March 2026, we reached an agreement with our bondholders on a restructuring plan that would have allowed us to emerge as a go-forward business,” Dave Davis, Spirit’s president and chief executive officer, said in a statement. “However, the sudden and sustained rise in fuel prices in recent weeks ultimately has left us with no alternative but to pursue an orderly wind-down.”
President Donald Trump said Friday that the White House had presented a final proposal aimed at keeping the airline operating and preserving roughly 14,000 jobs, but indicated any intervention would proceed only if it met government terms.
“If we can help them, we will, but we have to come first,” Trump told reporters before departing for Florida. “If we could do it, we’d do it, but only if it’s a good deal.”
Transportation Secretary Sean Duffy said on May 2 that Trump was like a “dog on a bone trying to figure out a way to keep Spirit afloat” and denied that the Iran war contributed to the airline’s collapse.
“Long before the war with Iran, multiple times, Spirit had filed for bankruptcy,” Duffy told reporters during a press conference.
“Their model wasn’t working. They couldn’t get the fiscal health. So this … this was not the impetus. The war was not the impetus for Spirit shutting down.”
The airline, once responsible for about 5 percent of U.S. flights, is the first of its size to liquidate in roughly two decades.
Restructuring Plan Collapses
Spirit Airlines had spent months trying to stabilize its finances under Chapter 11 bankruptcy, working on a plan to cut costs and continue operating on a smaller scale. Earlier this year, the airline reached a preliminary agreement with key lenders that would have allowed it to exit bankruptcy by early summer while focusing on its strongest routes.
That plan unraveled as fuel prices surged, driving up costs for a business built on low fares and thin margins. Company executives said Spirit needed hundreds of millions of dollars in additional funding to keep operating, but was unable to secure it.
“This is tremendously disappointing and not the outcome any of us wanted,” Davis said in the May 2 announcement. “We are grateful to our relentless Spirit team for their tremendous effort during our restructuring.”
The airline had also explored selling aircraft and scaling back operations, but those steps were not enough to offset the rapid increase in expenses, with Spirit blaming “the recent material increase in oil prices and other pressures on the business” for having a significant impact on the company’s finances.
The shutdown marks the end of a 34-year run for Spirit, which built its brand on ultra-low fares. At its peak, the airline operated hundreds of daily flights and employed roughly 17,000 people.
The carrier said Saturday that customers can expect automatic refunds for flights purchased directly through Spirit with a credit or debit card, but that refunds for flights booked by any other method would be determined at a later date through the bankruptcy process.
Spirit’s financial struggles date back years, with losses mounting after the COVID-19 pandemic amid rising costs and growing debt. By late 2024, the airline had lost more than $2.5 billion since 2020 and filed for bankruptcy protection. It sought Chapter 11 protection again in August 2025, reporting about $8.1 billion in debt against $8.6 billion in assets, according to court filings.
Transportation Secretary Sean Duffy said he had approached multiple airlines about buying Spirit Airlines but found no interest.
“What would someone buy?” he told Reuters. “If no one else wants to buy them, why would we?”
Jacki Thrapp and Reuters contributed to this report.
