Washington - Bankrupt discount carrier Spirit Airlines is preparing to cease operations around 3:00 a.m. Eastern Time Saturday, according to sources close to the discussions. A board meeting ended without a rescue agreement.
The collapse will result in thousands of lost jobs and marks the first US airline failure partially caused by a doubling in jet fuel prices during the two-month-old Iran war. Spirit once accounted for 5% of domestic flights and helped keep fares low in competitive markets.
Transportation Secretary Sean Duffy said he tried to find a buyer for Spirit but found no takers. “What would someone buy?” Duffy said. “If no one else wants to buy them, why would we buy them?”
The White House proposed $500 million in financing for warrants equivalent to 90% of Spirit’s equity, but not all bondholders agreed. A creditor stated, “The Trump Administration made an extraordinary effort to try and save Spirit, but you can’t breathe life into a corpse.”
Spirit’s over-the-counter stock fell 25% Friday, while rival Frontier rose 10% and JetBlue gained 4%. Major carriers including United, American, Frontier, and JetBlue said they are preparing to accommodate Spirit customers.
Spirit had built its bankruptcy turnaround on jet fuel costs averaging $2.24 per gallon in 2026, but prices surged to $4.51 by the end of April, doubling projections and derailing the plan.