Today, the number one topic in perhaps all of the non-car transportation news is that one of everyone’s least favorite airlines — though a fan favorite of those trying to save money — has filed for bankruptcy. That’s right, Spirit Airlines, the operator of those eye-searing yellow planes and home of some impossibly cheap fares has hit some serious money troubles. The company will be sticking around, but it seems the strategy of nickel and diming customers might not be working anymore.
Spirit Airlines filed for Chapter 11 Bankruptcy protection on Monday. Years of mounting losses, increased competition, and a failed merger have all caught up and the airline has finally punched the clock. This makes Spirit the first major U.S. airline to file for bankruptcy in 13 years after American Airlines. Spirit’s failure adds to a longer list of major U.S. airlines that have failed in the past 25 years, which includes the aforementioned American, United Airlines, and Delta Air Lines.
Spirit is down, but not out as it will continue to operate. But I think it’s important to talk about how Spirit got here, and not just from a monetary perspective. The passenger experience matters, too. Spirit has never been a glorious way to travel, but somehow, things have gotten worse with upcharges at every turn. Even us miserly folk have our limits.
As most of our readers know, I am a serial cheapskate. I buy the cheapest, most depreciated versions of my dream cars. I used to import phones from other countries to save money. The computer screen I typed this piece on dates back to the late 2000s and is only barely standard HD. I think you get my point. This also applies to travel. I feel weird if I pay more than about $200 for a domestic flight. I recently paid $277 to fly from Chicago to Gainesville and I still feel like I got robbed on that one.
That’s where airlines like Allegiant Air, JetBlue Airways, Frontier Airlines, and Spirit Airlines come in. If you’re one of our European readers, you’re almost certainly aware of the likes of Ryanair or Wizz Air. These airlines are built for people just like me who couldn’t be bothered to spend more than a few bones on traversing over 1,000 miles in mere hours.
My cheapest flight on Spirit cost me a whole $31 after tax. That got me from Chicago to Denver. You can’t even buy a tank of gas for that little money! Back in 2023, I even flew to Tampa and back for a grand total of $58. Before I enjoyed United Polaris for the first time last month, these ridiculously cheap flights were the ones I bragged about. America’s Ultra Low-Cost Carriers (ULCC) and Low-Cost Carriers provide a ridiculously good value for your money. Well, so long as you’re willing to live with the many caveats, but we’ll get there in a moment.
How Spirit Got Here
A fascinating part about Spirit’s story is that it didn’t even start out as an airline.
It was founded as the Clippert Trucking Company in 1964 before changing its name to the Ground Air Transfer Inc. in 1974. That business transitioned to Charter One Airlines in 1983 and it started providing chartered tour flights. Spirit as we know it was born in 1992 when the firm bought jet aircraft and started flying scheduled flights to major cities. Yet, Spirit didn’t become an ULCC until 2006 when Spirit was acquired by the Indigo Partners.
An Ultra Low-Cost Carrier operates differently than an airline like American or United. The ULCC business model focuses on cutting as much cost as possible. Most ULCCs operate just a single type of aircraft – usually the Boeing 737 or Airbus A320 – and configure each of those aircraft exactly the same with an all-economy configuration. Operating just one type of plane means that everyone, from mechanics to cabin crew, needs to be trained on only one type of plane, further saving costs.
In the past, ULCCs used to fill their fleets with used planes to save money, but now many carriers will just buy lots of new planes in bulk and then sell them for higher prices when they’re just a few years old. That saves the company money and it also benefits the customer since it means the planes usually stay nice and fresh. Well, as nice as a bare-bones all-economy Spirit plane can be. Flying new planes can also be cheaper to operate in the long run since they’re more efficient and may not be as maintenance or training-intensive as an old bird.
ULCCs also have other ways of trimming the fat from their operations. They will often order planes with as few features as possible to cut down on weight. Interiors will also usually be barren with the absolute bare minimum to get people from one destination to another. If you’ve ever flown Spirit or Frontier you know these airlines basically put glorified bus seats in their planes and your only luxury is a tiny tray table. The airline doesn’t even try making the seats look pretty. Frontier doesn’t even offer Wi-Fi, citing costs and the weight of carrying the equipment in each aircraft.
Other ways ULCCs save money include flying to smaller airports with cheaper fees, utilizing cheaper air stairs over fancy jet bridges, and having airline employees do multiple roles so they don’t have to hire more people. Depending on the ULCC you fly, you might see your gate agent on the flight later as a flight attendant!
All of this is done in an obsessive effort to make the airline as cheap to operate as possible. In theory, it also allows an airline to charge you peanuts for a base fare. But don’t worry, they have ways of squeezing cash out of you.
The Struggle
My very first flight ever was aboard “Fallon The Falcon,” a new Airbus A321 flown by Frontier Airlines.
I paid Frontier about $50 to fly from Chicago to Los Angeles. It didn’t take long before I discovered that my $50 got me a seat and very nearly nothing else. I was able to print out my ticket at a kiosk at O’Hare for free, but a carry-on was an upcharge, baggage was an upcharge, printing your ticket at the counter was an upcharge, insurance was an upcharge, and anything more than a cup of water on the plane itself was an upcharge. I couldn’t even pick my seat without paying for it.
In 2017, I flew Spirit for the first time on the aforementioned $31 flight to Denver. Back then, Spirit was similar to Frontier where your ticket got your butt in the seat and that was about it. The one twist was that back then, Spirit offered free soda on the flight and not just water.
I was fine with this configuration. In both cases, I flew one way to buy a car in a far-flung place. I didn’t need to bring any luggage or any extras. I also didn’t need a person to print my ticket when the kiosk was perfectly fine at that job. I had just my phone and whatever I fit in my purse, so I didn’t need to pay for anything else. Spirit and Frontier were perfect for those kinds of travelers.
It would appear that this business model worked for Spirit at first. Its profits were solidly in the hundreds of millions every single year. Sadly, the company hasn’t posted a full year of profit since 2019. The pandemic itself dealt a blow to travel. Lockdowns meant people couldn’t fly and even when things did open up again a lot of travelers just weren’t taking to the skies at first.
As CNN Business reports, the U.S. airline industry collectively burned billions of dollars over the first two years of the pandemic. But then, travel demand recovered and the big airlines went back to making money. Meanwhile, Spirit stayed limp. According to VOA News, Spirit has lost $2.5 billion since the beginning of 2020 and it has another $1 billion in debt payments coming due within the next year.
VOA News offers a number of explanations for the faltering of Spirit. The publication notes that consumer tastes have changed in the post-pandemic world. More people want to fly on more premium flights today, which bare-bones carriers like Spirit cannot compete with. Then there’s the competition. It used to be that Spirit only had to worry about other ULCCs, but now the big airlines offer cheap tickets as well and do so by flying out of better airports and with a greater chance of arriving at your destination on time.
Spirit took other hits to its operational costs, too. As VOA News reports, the airline’s labor costs have increased and then there’s the planes themselves. A Pratt & Whitney engine recall has forced the airline to ground aircraft. It has also sold 23 planes, pumped the brakes on future plane acquisitions, and furloughed hundreds of pilots to try to stay afloat.
Then came the failed merger. Frontier tried to merge with Spirit, but was outbid by JetBlue. Just as things were looking brighter for Spirit, the Justice Department successfully sued to block the deal, saying that the merger would have driven fare prices upward, effectively defeating the main consumer benefit of a ULCC.
Despite all of the above, Spirit has actually managed to fly more passengers this year than it did before the pandemic. VOA News notes that Spirit’s demand was up two percent in the first six months of this year, yet those passengers were paying 10 percent less per mile and Spirit was making 20 percent less revenue per mile. So, Spirit is flying more passengers, but they’re paying less money, deepening the company’s woes.
The View From The Window Seat
All of these are bad, but I want to take a brief detour to illustrate a reason why someone might fly Basic Economy on United rather than Spirit.
Flying Spirit has never been the greatest experience, but somehow, it often feels like the experience is worse than it should be. I took a red-eye Spirit flight in 2021 during the pandemic and was surprised to get not just free drinks, but free alcoholic drinks. The flight attendant gave me a free margarita. I’m not sure if she was supposed to do that or not, but it made flying at midnight on Spirit so much better. My Spirit experiences have never been so good again.
On my very next Spirit flight, I asked for a cup of water – something that was previously free – and the flight attendant asked for money. When I expressed shock at hiding a cup of water behind a paywall she rolled her eyes and said “Honey, you’re not getting anything for free on this plane.” I feel like there could have been a better way to say that. Free water wasn’t a problem in the past. But sure enough, every single thing on the plane was behind a paywall but using the lavatory.
Most Spirit flights since that time haven’t felt so friendly. I don’t blame the flight crew. They have a hard job to do and one that doesn’t get enough respect. But Spirit cabins don’t feel nearly as welcoming as they used to. 
According to a CNN report from 2014, Spirit topped the charts of airline complaints with 9.4 complaints per 100,000 passengers. Second place was Frontier with 3.1 complaints per 100,000 passengers. Third place was United with a distant 2.1 complaints per 100,000 passengers. Don’t think it has gotten better either. As of last year, Frontier reportedly topped the complaint chart with 33 complaints per 100,000 passengers while Spirit still managed to do poorer than its 2014 numbers with 15 complaints per 100,000 passengers. Once again, the non-ULCCs weren’t even in the same ballpark with significantly fewer complaints.
According to J.D. Power, Spirit ranks second to last in overall customer satisfaction for the category of Basic/Basic Economy. Southwest takes the crown while Frontier is the only one rated worse.
In other words, many people have experienced problems with these airlines for a while. In fairness to Spirit, things aren’t perfect with the big guys either. I’m pretty sure most people still remember the United overbooking controversy from years back. But, statistically, people still like the big guys far more than the ULCCs.
It still gets weirder from there. If you fly Spirit regularly like I do, you’re used to not getting places on time, if you leave at all. Back in 2021, I reported on how Spirit canceled 2,000 flights in one week, which in some cases equaled 60 percent of its daily schedule. Back then, Spirit cited bad weather and aircraft crews timing out creating a snowball effect. Spirit then didn’t have any arrangements for travelers to fly with other airlines, so people were just stranded unless they bought another ticket with another airline. Scheduling catastrophes are not unique to Spirit – Wow Air collapsed in 2019 leaving passengers stranded in Iceland – but a frequent traveler might remember that on their next booking.
Spirit also still struggles to get people places on time. Back in January of this year, it reportedly got people to places on time 71.16 percent of the time. That was only slightly below the 74.45 percent national average, but a long way from Delta’s 84.72 percent performance. A recent report shows that Spirit has fallen to getting planes places on time only 67.1 percent of the time, somehow only narrowly beating JetBlue and Frontier’s lower numbers.
Spirit has found other ways to upset customers, too. Remember how I said that it used to be free to print your boarding pass off at a kiosk? That now costs $2. Having an agent do it is $10. Now, I’m well-versed in tech, so I have my boarding pass on my phone. But I know too many older or less tech-savvy passengers who still do things the old way.
All of this is to say that Spirit’s business model of aggressive cost-cutting and super-low fares bolstered by plentiful microtransactions may no longer be working. A Reuters report suggests some analysts on Wall Street feel the same.
Spirit has already recognized that some passengers prefer a more premium experience. As a result, the airline has revamped its pricing structure in hopes of luring customers away from the competition. A few months ago, Spirit launched different pricing bundles where you could still do the old-school “bare fare” or pay more money to get an experience with the microtransactions already baked into the fare as you’d get with American or Delta.
What Happens Next
Alright, so Spirit Airlines has filed for bankruptcy, what comes next? This bankruptcy is a restructuring, which means the airline will continue to operate and will continue to honor your purchases. In the immediate future, you as a passenger shouldn’t notice any real change and if you’re a Spirit employee you should still get paid. You can still book flights and still accrue rewards points. Remember, America’s airlines are used to the whole bankruptcy thing.
In the near term, Spirit plans on furloughing more employees. In the long term, Spirit expects to negotiate with its creditors, reduce its debt, and emerge from bankruptcy stronger than when it went in today. Spirit even says that its creditors have agreed to invest $350 million into the airline to keep it running through the bankruptcy proceedings.
However, bankruptcy doesn’t always have such a happy ending. Spirit could get bought out or liquidated and merged with another airline. Remember that American Airlines and US Airways completed a merger in 2013 after the former filed for bankruptcy in 2011. As CNN Business notes, while the Spirit and JetBlue merger was blocked in the past, a new merger would likely be attempted in the soon-to-change political landscape and there’s no telling if Trump’s Justice Department would be more okay with a merger.
It’s too early to tell what Spirit’s fate will be, but it seems that how the airline is currently running might not be a winning model right now. What I do hope is that the airline that comes out of the other side figures out how to stay competitive without those microtransactions at every turn.
(Images: Spirit Airlines, unless otherwise noted.)
If there’s any justice in the universe Frontier will go next.
I, for one, am shocked, just shocked, that this was not a sustainable business model.
I accidentally flew the KLM version of Spirit for one leg of an international trip and it put me off ever doing it again. It flew out of a different, crappier terminal with super long lines to check a bag and then left significantly late. The plane was absolute misery for me as a tall person. I did not fit in the seats in any dimension. I managed to lose my headphones trying to squeeze my bag under the seat in front of me but didn’t realize it until I was off the plane.
I’d rather not travel than fly Spirit or any of their direct competition.
If Spirit/Allegiant/Frontier is my only option, I’ll drive! I used to fly a lot more for work than I do now. I got spoiled by Delta. My wife usually goes Southwest for work. She’s booked a few personal trips for us on them, and it wasn’t bad. But I still joke with her about not using a “real” airline! I try my best to never fly American. I’m still bitter over family members getting screwed over in the TWA “merger”.
Good article, Mercedes. I just read about Spirit in the Wall Street Journal and you’d have thought that the only reason they went bankrupt was the government’s denial of the merger with Jet Blue. They didn’t really get into the poor service, awful performance, and the weaknesses of the business model.
One thing is for certain:
The C-Suite won’t suffer at all.
Golden Parachutes, Anyone?
Spirit is the classic example of the ULCC that doesn’t understand penny-pinching!=efficiency. Sure, they take every opportunity to nickle and dime you, but in my experience they do very little to reduce operational costs in a meaningful manner. They contract out most of their tech and ground services at market rates, they have no meaningful efficiency improvement efforts, and they piss off their employees enough that no one in line service actually wants to make things better. Unsurprised they are going bankrupt, and this is your daily reminder to not fly them.
Over the years I have come to realize that eventually every ULCC will go the same route, save for one: Ryanair. Ryanair, shitty though the passenger experience may be, is on the business side one of the best run airlines on the planet. They keep quite a lot in-house and use their scale to drive the cost of flying the plane down to the absolute minimum, and that includes realizing safety is a cost benefit (they are one of the safest airlines around). Mandatory disclosure: I have no affiliation with Ryanair, and would rather walk than suffer through the experience of flying with them, but if you put a gun to my head and made me choose a ULCC flight it would be them without hesitation.
One other point that few LCCs realize: those cheap A320s are indeed a little too good to be true. While I prefer them as a passenger, and most pilots seem to prefer them as well, they are kind of ramp princesses- they break often and badly, and are generally a PITA to keep flying compared to the competition. 737s on the other hand, for all of their other flaws, can be beaten like a rented mule for years without fail and still make you money. It is not an accident Ryanair and Southwest use them.
I am on Team Southwest, because of Spirit Airlines. Every time I flew Spirit, I often overheard passengers promising that it was the last time they’d fly Spirit. Even the cabin crew played into the self depreciation by joking about how bad Spirit was.
I flew into Denver once on Spirit and it took 1hr, 25 mins for the bags to arrive to the baggage claim. Southwest was nearby and was on the intercom saying “for baggage on-time, please go to southwest.com.” ***cue universal groans from my flight.
Eventually, I started to fly Southwest, as most of the employees seem much happier working there, and free bags/sodas are such a huge upgrade from flying other lower cost airlines. After the bag fees, normally the cost is about the same.
Flew it once from Dallas to Vegas. On the way out, it was fine. I knew what I was getting, what I had to pay for, and didn’t mind.
The flight home was a redeye. Taking a redeye from Vegas after having to check out from your hotel room at 11am is already a bad idea, but then throw a 4 hour delay on top of it and it was miserable. One passenger was trying to start some sort of protest or riot on the plane and I just wanted to sleep. Decided that day never again.
Had some issues on Frontier a couple years later. Now I’m all United or Southwest.
Delta for me. They go damn near everywhere, flights are reasonable, planes are in pretty good to very nice condition. Staff interactions were very pleasant and professional too.
American runs second (forgettable service, but they will get you there), and United planes are drab, dirty, beat-up things. Newer livery planes look nice for United, but they seem scarce.
Allegiant flies here too, and I’ve taken them at times to different destinations. Somewhat different experience, I’ve been on an Allegiant flight where we came in too hot on final approach and overshot the landing zone, resulting in a touch and go and circle for second attempt. Fun times on a full MD-80 when that happens.
Delta is great. If I didn’t live in an United hub thats where my money would be going.
My only complaint about Delta is that they never enforce any kind of carryon restriction. I fly delta a lot as I live by a hub and go to Florida a few times a year. There are always people getting on a Delta plane with 3 carry-ons all the size of a hockey bag. Also, there is ALWAYS someone carrying on a guitar. Other than that Delta is good.
I mean, this is non-negotiable. As a musician, you always travel with your instrument on you. If your instrument is large enough though, it needs its own ticket.
People finally wised up to the fact that by the time you pay all the fees, you might as well just fly the majors. Where if your flight is cancelled you have a sporting chance of making it home the same calendar week…
Spirit literally makes the news EVERY year here in God’s Waiting Room, FL for stranding multiple planeloads of people for days and days and days.
I made my million miles on Delta when airline travel was pleasant and they actually had real people in color-coded blazers to rebook flights or give you an upgrade. To me, every modern airline (except high-buck international travel like Mercedes flew) seems like riding the subway.
You must be older than dirt. I have been flying 100K+ annually since 1996 – I have about 2.5M across Northwest, Delta, and American. and the main thing that has changed is flying is a LOT cheaper today on average (post pandemic price spikes notwithstanding), there are a LOT more options and they haven’t tried to kill me as much this century. And I will take today’s flying over that of yesteryear when people could SMOKE on airplanes. Blech.
If you want a nicer experience today, just fly business class domestically (I refuse to fly coach internationally regardless). It costs about what coach did back in the olden days with a bit of willingness to be flexible about flight schedules. The main difference today is that people are fat, entitled, whiny, and have the Internet soapbox to whine from.
The good old days weren’t actually all that good.
My first flight as a small child for a funeral had a smoking section. Fortunately my later business travel was smoke-free and paid for by others. In the 80s and 90s Frequent Flyers got free upgrades and access to the airport lounges. You could breeze through “security” with your clothes on, walk up to the gate and get on the plane. Yes it was expensive and I didn’t mention that because my comment was about the experience, not the price.
You can still do all those things as a frequent flier. I get upgraded all the time, get lounge access, and my airline credit card pays for TSA PreCheck via a statement credit every five years. PreCheck is insignificantly different from pre-9/11 security – chuck your crap on the belt for the x-ray and walk on through the metal detector – and a hell of a lot better then immediately post-9/11 security where it was the freaking Wild West and you never knew what nonsense you were in for. TSA is “security theatre” but at least it is *consistent* security theatre.
Planes ARE more crowded today – but that is largely because flying is so much cheaper that literally everyone can afford to do it. If you are willing to pay the same money as back in the day, the experience is actually largely BETTER, not worse. At least as long as you stay away from the likes of Spirit and Frontier.
Good God flying when people could smoke was HORRIABLE! Even after smoking was kicked off the plane and there were “dedicated” lounges, I remember sitting on the floor of the Charlotte airport for fresher air as you could see the smoke wafting across the airport from the lounge.
It sure was – I had the fun of flying standby to Europe back when I was a poor, in the last row of the cheap seats ahead of the smoking section on a TWA 767. Dear God…
I don’t think there are any US major airports left with smoking lounges. The last one I can think of was IAD, and they are long gone. But maybe down south somewhere.
There is still a handful https://no-smoke.org/wp-content/uploads/pdf/smokingpoliciesbusiestairports.pdf
Not at all surprised by Las Vegas, but I have never been there. Nevada is the only state I have never been to. That a couple of restaurants/lounges still have open air smoking doesn’t surprise me, but those aren’t run by the airport itself like the old smoking holes right on the concourses were.
Regardless – gross.
Nevada is worth the trip. Cool state parks and the BlackRock desert is amazing (except during burning man)
I actually want to go to Vegas just to see the spectacle of it all. Been trying to go with my bestie for years, just can’t get our schedules sync’d enough to actually do it.
But I am NOT really one for much of the great outdoors. And other than for car-adjacent reasons, when I am on vacation I generally stay home – I travel MORE than enough for work.
Spirit has never been an option for me, not out of prejudice, but at 6’7″ I’m not risking any amount of time in those seats.
Frontier used to be our go-to, however they’ve increased prices out of MKE significantly and now have a max bag weight of 40lbs instead of 50 (fuckers) to try and charge you more. They actually changed that policy when we were in Punta Cana a few years ago and tried to scam us out of $50 a bag, even though there was no prior communication of the change!
Unfortunately, I’m now left flying Southwest for vacation destinations. I used to fly Delta for work, but haven’t had a flight all year so no points/rewards for us right now (and the wife hates connections). I don’t mind Southwest, but the whole “pick your seat, but you gotta pay extra to get in line to get a good one” is a whole shtick I could do without. Thankfully they are changing that, so I might appreciate them more now.