By John Q. Hosedrinker 
Spirit Airlines filed for bankruptcy protection again, just months after emerging from Chapter 11 in March, due to continued high costs and weak demand. The airline plans to reduce its network and fleet to cut costs, aiming to save “hundreds of millions of dollars” annually. Spirit’s previous restructuring focused on debt reduction, but this new filing indicates the need for more significant changes. Labor unions anticipate further adjustments, including potential furloughs and voluntary leave, while the carrier’s shares have plummeted.
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Spirit Airlines files for Chapter 11 bankruptcy protection for the second time in a year. Well, here we are again. It’s hard to believe, but Spirit Airlines has filed for Chapter 11 bankruptcy protection, and not just once, but twice in a single year! This is a significant development, to say the least, and it has a lot of people talking. What’s going on with this budget airline?
It’s fair to say, the company has a reputation. Many have described Spirit Airlines as having a consistently poor customer service experience, plagued by frequent flight delays and cancellations, and notoriously uncomfortable seating. It seems, in fact, it’s known. I’ve even heard stories of passengers stuck in the air due to cancellations, only to face days-long delays for alternative flights. I can only imagine the frustration.
Now, there’s a strong debate playing out. Some have a deep distaste for the company, and are celebrating its potential demise. Many feel that their experiences justify a complete shut down. On the other hand, some appreciate the role it plays in the market. It is a fact that Spirit offers incredibly cheap flights, often a fraction of the price of major airlines, particularly when going international. It is also agreed that, generally, the lower-cost airlines do bring down the cost of travel for everyone.
A recent experience highlights this. One person mentioned a Delta flight costing $2000, where a Spirit flight was only $600. Others note that Spirit’s domestic tickets often cost far less than those on other carriers. It is true. Their affordability is a key factor, especially for budget-conscious travelers who might not otherwise be able to fly. It’s a real issue if flying becomes exclusively for the wealthy.
Of course, the low prices come at a cost. Spirit’s business model often involves charging extra for everything – from carry-on bags to seat selection. There are plenty of stories about the experience of flying Spirit, especially about the uncomfortable seats and the nickel-and-diming of every aspect of the journey. But, for some, it’s a trade-off they’re willing to make. They know what they’re getting.
There’s considerable frustration with the way Spirit is run. Many feel that the company’s management hasn’t been up to par and that executive compensation needs serious reform. The point is, how do you make sure that executives aren’t draining the company dry while the business collapses? The focus should be on employees.
And then there was the missed merger with JetBlue. Some feel that the merger would have helped them both. It’s easy to say “hindsight is 20/20”. It’s pretty obvious that denied merger had a significant impact.
There are those who defend Spirit, saying it provides an essential service by offering affordable flights. It’s also been said that its presence helps to control the exorbitant prices of other airlines. They make the bigger companies have to compete. Without Spirit, the argument goes, the larger airlines could essentially price-gauge more.
There are those who have flown Spirit many times and had positive experiences. But there are also plenty of horror stories. Long delays, changes of airports, and unexpected costs are some of the more frequent complaints. Some people say they will never fly with them again. Scabies, anyone?
And let’s be clear, there are major issues at play. The failure of the JetBlue merger and the problems with the Pratt & Whitney GTF engines have severely impacted Spirit. Many of their new aircraft are grounded waiting for repairs. These factors have undoubtedly contributed to the airline’s financial woes. And it’s the combination of all of these issues that led to the current situation.
It appears that Frontier is in a similar situation, though perhaps not as dire. The future is very uncertain for these types of companies.