Spirit Airlines faces potential liquidation after filing for bankruptcy twice and struggling with rising jet fuel costs due to the Middle East conflict. Experts warn that these challenges could hinder its plans to emerge from bankruptcy this summer.
Key points
Spirit Airlines filed for bankruptcy twice since late 2024
The airline's merger with another airline was blocked
Rising jet fuel costs are a concern due to the Middle East conflict
Spirit plans to emerge from bankruptcy this summer
Experts warn that fuel costs could threaten the airline's future
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Spirit Airlines planes parked at the closed George Bush Intercontinental Airport, Jan. 21, 2025, in Houston.
Spirit Airlines planes parked at the closed George Bush Intercontinental Airport, Jan. 21, 2025, in Houston.
David J. Phillip/AP
David J. Phillip/AP
For the past few years, Spirit Airlines has been in trouble: It has filed for bankruptcy twice since late 2024 and had a merger with another airline blocked. Now, like all carriers, it faces rising jet fuel costs because of the ongoing war in the Middle East.
Spirit has said it plans to emerge from bankruptcy protections this summer. But experts say the rising cost of fuel due to the war in Iran could throw a wrench in those plans — and shut the company's doors for good.
Department of Transportation Secretary Sean Duffy said at a Tuesday press conference that he is "taking a look" at the airline at President Trump's request.
"[Spirit has] just declined to the point now where they'll have to shrink to survive. And no airline can shrink to survive," said Mike Boyd, the CEO of Boyd Group International, an aviation forecasting company. "So it's a matter of time with or without fuel costs. This just accelerates things."
Spirit Airlines told NPR in a statement it does not "comment on market rumors and speculation. Our operations continue as normal."
But if experts' projections pan out, what could the loss of Spirit mean for the airline industry — and consumers? Opinions vary.
Jan Brueckner, a retired economics professor who taught at the University of California, Irvine, says Spirit's competitors would benefit greatly from the airline's closure, but consumers would be left in a bad spot.
In the airline industry, Spirit is considered an ultra low-cost carrier. Tickets are usually cheaper than major airlines, but passengers have to pay separately for things such as carry-on luggage, snacks and Wi-Fi, depending on the type of ticket they book.
Other ultra low-cost carriers include Frontier, Breeze and Avelo. Their business models have encouraged major network airlines like Delta, American and United to respond with lower-cost offerings like basic economy seats, Brueckner said.
But if Spirit goes away, those basic economy fares could start to creep back up, since the airlines would have fewer competitors in the ultra low-cost space, Brueckner said.
"The alternatives won't be there," he said. "So Spirit's troubles are not good for the traveling public, both because Spirit itself may disappear, and because the discipline it imposes on the other carriers will disappear as well."
On the other hand, Boyd predicts Spirit closing down wouldn't move the needle very much, as its competitors take up so much more of the market.
From February 2025 to January 2026, Spirit had 3.4% of the airline industry's domestic market share, compared to 16% to 18% each for Delta, American, Southwest and United, according to the Bureau of Transportation Statistics.
"Take this one to the bank. If Spirit went down, within a fortnight, it won't be missed," Boyd said.
If it does cause a shakeup anywhere, it would likely be in Fort Lauderdale, Fla., Boyd said. Spirit Airlines had a market share of about 27% there in January, according to the Bureau of Transportation Statistics.
"So don't worry about fares going up. They're just not big enough," he said.
Competition from major airlines is just one of the factors contributing to Spirit's woes, Brueckner said.
Spirit filed for bankruptcy protection twice in less than a year, in November 2024 and August 2025. However, Spirit said in a March statement that it expects to emerge from Chapter 11 bankruptcy protection by "early summer" by prioritizing its strongest markets and offering more premium selections.
It also has had to ground many of its planes due to engine issues. Additionally, the airline might have trouble affording the cost of fuel, which has been rising since the start of the U.S. war against Iran, Brueckner said.
A merger could have helped the airline out, he said.
Spirit announced in 2022 it had agreed to merge with JetBlue. But a judge blocked the merger in 2024 due to concerns that the companies joining forces would monopolize the industry. Merrick Garland, the attorney general at the time, said there would be "tens of millions of travelers who would have faced higher fares and fewer choices" if the merger went through.
But Brueckner thinks it would have been a win-win for consumers and Spirit. It could have given Spirit more financial resources and market share, he said. "In other words, having big players that are charging low fares, that's good for everybody. Not good for United, American, Delta — but it's good for the traveling public."
It's hard to know what the long-term future is for Spirit Airlines. Boyd says he doubts the company will be able to reemerge, while Brueckner hasn't totally counted them out.
"Airlines keep coming and going…so we'll see," he said.
