Spirit Airlines looks like it’s getting spirited away.
The airline is preparing to shut down after attempts to establish a $500 million bailout from the Trump administration fell through, according to reporting from The Wall Street Journal. Negotiations for the government lifeline had been underway for weeks as Spirit’s cash reserves dwindled, but investors have reportedly balked at the prospect of the federal government becoming a majority owner of the company.
Despite reports saying that the company is prepping to cease operations, a company spokesperson declined to comment when asked by Fast Company, and said that “Spirit is operating as usual.”
On Friday, President Trump said that the government would bail out the airline. “If we could do it, we’d do it, but only if it’s a good deal,” he stated, adding that “we gave them a final proposal.” Trump didn’t completely shut the door, however, saying that he’d like to “save the jobs” and telling reporters that he would “have something for you today or tomorrow.”
Unsurprisingly, shares of Spirit Aviation Holdings took a nosedive, falling from $1.30 per share to $0.40 shortly after 11 a.m. ET. But as of around 1 p.m. ET, shares had gone back up to $1.30. Over the past five days, shares have been down almost 35%.
Though a Spirit attorney told a bankruptcy court during an April 23 hearing in New York that the company was going to run out of money, Spirit has not announced or formalized plans to liquidate or shut down. But it has been slowing down its operations. Last year, the carrier cut departures significantly compared with the previous year, and it discontinued service to several destinations.
The budget airline has been struggling for years and has declared bankruptcy twice since 2024. It appears that the recent spike in fuel prices is the straw that’s breaking the camel’s back. Airlines across the spectrum are scrambling to find solutions to handle increased costs—something that’s not going over well with a potentially price-sensitive market segment that Spirit aims to serve.
