Spirit Airlines files for Chapter 11; services continue amid financial overhaul

Due to Chapter 11 proceedings, Spirit expects delisting from the New York Stock Exchange (NYSE), though shares will continue trading over-the-counter without value in restructuring. The airline’s shares have lost significant value this year but saw a slight increase during pre-market trading after the announcement.

The last major U.S. airline undergoing similar restructuring was American Airlines in 2011, emerging from bankruptcy protection in December 2013 after merging with US Airways. Other international carriers like Aeromexico and LATAM Airlines have also successfully navigated Chapter 11 processes recently.

Spirit assured travelers operations would continue normally during restructuring, allowing it to invest further in travel experiences. Despite financial challenges and delays in quarterly reporting due to liquidity improvements efforts, Spirit remains committed to providing value through new travel options launched earlier this year.

In industry trends discussion, United Airlines executives noted challenges faced by low-cost carriers like Spirit due to unprofitable capacity and changing business models. However, Christie stated that their model is not obsolete but evolving with premium service offerings now available since August.

Grounding issues related to Pratt & Whitney engines have affected some of Spirit's fleet but are being addressed through agreements improving liquidity by up to $200 million this year.