Spirit Airlines is once again entering bankruptcy protection less than a year after its last filing, underscoring the challenges facing the struggling discount carrier. The airline announced Friday that it will undergo another Chapter 11 restructuring after a failed attempt to reorganize its business and steady operations.
In an open letter to customers, President and CEO Dave Davis framed the move as necessary to secure the airline’s future. He stressed that the bankruptcy process is intended to “ensure the long-term success of our company so we can continue to serve our Guests well into the future.” Spirit also noted that “virtually every major airline has used these tools to improve their businesses and position them for long-term success.”
This latest setback follows Spirit’s initial bankruptcy filing in November, which came on the heels of two failed merger attempts with Frontier and JetBlue. The low-cost carrier has struggled to compete against larger airlines that offer more destinations, higher levels of service, and bundled perks that Spirit’s bare-bones model does not provide.
The airline reassured travelers that it will continue operating flights as normal during the restructuring process. Tickets, credits, and loyalty points will remain valid, and Spirit pledged that its employees remain committed to offering “a safe journey, with excellent service and an elevated experience.”
Spirit has been attempting to reposition itself as more premium in response to changing customer expectations, but ongoing economic pressures and tight budgets have hampered those efforts. Despite reducing debt and raising capital during its last restructuring, Davis admitted earlier this month that “much more work” remains to stabilize the airline and strengthen its future.
According to an SEC filing, Spirit continues to face weak demand for domestic leisure travel and a “challenging pricing environment” that has pressured revenues. The Wall Street Journal reported the company may need to cut destinations and reduce its fleet as part of the new restructuring plan.
In its statement Friday, Spirit called the move a “comprehensive restructuring” designed to better position the business for the long haul. The company has filed voluntary petitions for Chapter 11 in the U.S. Bankruptcy Court for the Southern District of New York, marking another chapter in its turbulent fight for survival.