Spirit Airlines planes taxi on the tarmac at New York’s Laguardia Airport in the Queens borough of New York, United States, November 7, 2025.
Ryan Murphy | Reuters
Spirit Airlines could liquidate as early as this week, according to people familiar with the matter.
They spoke on condition of anonymity to discuss matters that had not previously been made public.
The budget airline has been struggling to get back on its feet after its second bankruptcy in less than a year, but now faces the added challenge of soaring fuel prices. Fuel is the largest airline expense after labor.
“We do not comment on market rumors and speculation,” Spirit said in a statement.
The exact day the carrier might begin liquidation was not immediately clear. Bloomberg previously reported a possible liquidation.
The news comes just as the U.S. airline industry, including Florida-based Spirit, wraps up its busy spring break season.
Pilot and flight attendant unions have made concessions in recent months to try to help Spirit survive. The airline had planned to scale back operations and focus on high-demand periods and routes with the aim of emerging from bankruptcy as soon as this spring.
Spirit has enjoyed largely stable profitability for years and industry-enviable margins. But things changed after the pandemic, when wages and other costs climbed, customer preferences shifted and an oversupply of domestic flights drove down airfares, which was particularly punishing for U.S.-focused carriers that don’t enjoy the protection offered by luxurious first-class cabins and deep offers from credit cards and loyalty programs.
Its problems snowballed after a Pratt & Whitney engine recall grounded dozens of its Airbus planes starting in 2023 and its planned acquisition by JetBlue Airways was blocked two years ago by a federal judge who ruled it anticompetitive, leaving the two carriers to fend for themselves in a context where the largest carriers dominate.
Spirit projected it would generate net income of $252 million last year, according to a court filing in December 2024, but it said in an August report that it lost nearly $257 million in a few months, starting March 13, after exiting its first Chapter 11 bankruptcy, through the end of June. Less than a month later, she filed for Chapter 11 bankruptcy again.
The airline has tried in recent years to woo higher-spending customers by offering more spacious seats or bundled fares that include seat and baggage assignments to better compete with larger rivals whose profits have supported higher-spending customers after the pandemic.