Spirit Airlines Secures $475 Million Bankruptcy Loan as Future Remains Uncertain
WILMINGTON,Del. - Spirit Airlines has received court approval for a $475 million debtor-in-possession (DIP) financing package, providing a critical lifeline as the ultra-low-cost carrier navigates Chapter 11 bankruptcy proceedings. The loan, approved Tuesday by Judge Judith K. McMahon of the U.S. Bankruptcy Court for the District of Delaware, will allow Spirit too continue operating and meet its financial obligations while restructuring its debt.
Spirit filed for bankruptcy in January, citing ongoing financial pressures stemming from an engine recall, a blocked merger with JetBlue, rising costs, and shifting consumer preferences. The airline has struggled for years, and United CEO Scott Kirby recently predicted Spirit would ultimately “go out of business.” Despite these challenges, Spirit is attempting a strategic shift, recently introducing higher-end products like extra legroom seats in an effort to attract a broader customer base.
The DIP financing is provided by JetBlue Airways, wich previously attempted to acquire Spirit. The agreement allows JetBlue to potentially acquire SpiritS assets if the airline successfully reorganizes. Other airlines, including Frontier Airlines, JetBlue Airways, and Allegiant Airlines, have announced new routes in an attempt to capture Spirit’s customer base as its future remains in question.
Spirit’s bankruptcy filing listed assets and liabilities in the range of $3.5 billion to $5 billion. The airline intends to use the DIP financing to fund its operations during the restructuring process, pay employee wages and benefits, and maintain essential services for its customers. The case is In re Spirit Airlines, Inc., case number 24-10186, in the U.S. Bankruptcy Court for the District of Delaware.
