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The low-cost U.S. carrier Spirit Airlines has canceled all flights and started winding down its operations after efforts to secure financial support from the U.S. government collapsed, the company announced Saturday.
The carrier moved to shut down immediately, telling passengers not to head to airports as customer service systems were also taken offline. Refunds for booked flights are expected to be processed, according to the company.
The decision came after a proposed rescue effort, previously discussed at the White House, failed to materialize. Spirit’s parent company confirmed that without fresh liquidity, continuing operations was no longer possible.
CEO Dave Davis pointed to rising fuel costs as the decisive blow, explaining that the company had been working on a restructuring plan with bondholders earlier this year. That plan could have allowed Spirit to continue operating, he noted, but conditions shifted rapidly.
"Sustaining the business required hundreds of millions of additional dollars of liquidity that Spirit simply does not have and could not procure," Davis said, calling the outcome disappointing.
A sharp increase in jet fuel prices following the Iran war and the closure of the Strait of Hormuz added pressure to an already fragile financial position.
Industry figures show fuel prices have nearly doubled since February to above $200 per barrel, placing intense strain on budget airlines that rely on low fares and tight margins.
Spirit, which filed for bankruptcy twice in 2025, had earlier signaled plans to emerge from restructuring by early summer. However, the worsening cost environment derailed those expectations.
The airline employed more than 11,000 people as of 2024 and had operated for over three decades, building a reputation around its no-frills, low-cost model.
Talks had also been underway for potential government-backed financing, including a loan of up to $500 million that could have given the government a stake in the airline. Those discussions did not lead to a deal.
A White House spokesman said the administration is monitoring the situation, but no direct intervention has been confirmed.
U.S. President Donald Trump said Friday that Spirit had received a "final proposal" for a bailout package, adding that the administration would consider it only if it made financial sense.
American Airlines said early Saturday it was working with U.S. authorities to help ease the disruption for affected communities and passengers, offering "rescue fares" on Spirit routes, while United Airlines introduced price-capped one-way tickets from most cities previously served by Spirit.
Airlines for America (A4A) indicated that its members are stepping in to support passengers affected by Spirit’s shutdown while cutting costs and adjusting operations to cope with rising fuel prices, as the group opposed government aid for ultra low-cost carriers, warning it would distort competition.
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