Spirit Airlines tumbles on report it’s considering filing for bankruptcy | Wilnesh News

spirit airlines The company’s shares fell to a record low after a report Friday that the company was exploring Chapter 11 bankruptcy protection. The airline faces a deadline this month to renegotiate more than $1 billion in debt.

A bankruptcy filing would mark a dramatic shift for an airline that caters to budget-conscious travelers with its signature yellow planes.

Before the pandemic, Spirit’s cheap service was already profitable and on time, the butt of jokes among late-night comedians and a thorn in the side of big network operators, charging double-digit fares and fees for everything from seat assignments to carry-ons. Attract customer luggage.

But the major airlines soon succeeded in replicating much of the business model with the lowest base fares. Earlier this year, a federal judge blocked Spirit’s planned acquisition JetBlue Airways Citing antitrust grounds, it halted what the two companies saw as a key way to compete with larger rivals. broken deal Leave the spirit alone with one Pratt & Whitney Engine recalls, shifts in consumer travel patterns and higher costs.

Spirit Airlines said in January it was considering options to refinance its debt after its deal with JetBlue Airways collapsed.

Spirit has $1.1 billion in loyalty program-backed debt due next September. It has until Oct. 21 to refinance or extend those terms secured note.

The airline has been losing money since 2020 and reported disappointing results this year, including a second-quarter loss of nearly $193 million. The company has spent much of the year trying to cut costs, including furloughing pilots, cutting flights and delaying orders for Airbus jets.

Barclays aviation analyst Brandon Oglenski said earlier this week that Spirit Airlines was reducing capacity growth plans for November and December by about 17%.

“As we speak, Spirit has been implementing a comprehensive plan to help us compete better, strengthen our balance sheet and return to profitability,” Chief Executive Ted Christie said in a statement on Friday. said an employee report. “We remain in productive dialogue with our bondholders and we are committed to delivering the best outcome for the business as quickly as possible.”

A spokesman for Spirit Airlines declined to comment for this story. The Wall Street Journal reports The carrier is considering filing for bankruptcy. Spiritual consultant Perella Weinberg Partners declined to comment.

Spirit’s shares fell more than 24% on Friday, hitting a record low of $1.69. Shares are down nearly 90% so far this year.

shares Frontier Airlines, The company had planned to merge with low-cost carrier Spirit Airlines in 2022 before JetBlue suddenly stepped in, and its shares soared 16% on Friday. Shares of other airlines also rose.