Spirit Airlines Financial Difficulty

[OKW Lover]

Reading news reports on line that Spirit is in financial difficulty even after emerging from bankruptcy. I'd be very careful to have a backup plan if planning on flying them.

 

[SteveH]

Sadly, so many will get hurt when this company finally dies. There are so many warning signs, the latest SEC filing really shows how at risk consumers are. These troubles only a few months after exiting bankruptcy is not a good sign at all.

 

[gottalovepluto]

CNBC link

Spirit has filed a going-concern. Not good, basically they project they might run out of cash in the next 12 months.

Have backup plans, watch anything already booked carefully because schedules are likely to change.

Know your rights to get a refund. I think the rule is a 3hr change entitles you to a refund, check DOT. Consider not booking anything more than 120 days out, or whatever your chargeback window is for your processor, as if the airline goes belly up that may be the only way to get your money back. Not a guarantee but a better chance at least.

 

[jec6613]

Reading deeper into this, they should make it another 12 months - basically they're relying on cash from GTF engine failures that are grounding a significant percentage of their fleet, but due to GAAP this can't be relied upon income, hence the required going concern notice. If these planes were in operation presumably they'd make enough money to keep the airline healthy-ish.

Spirit has other financial health issues of course, so it could easily implode anyway for other reasons, but this isn't it.

Side note: Eastman Kodak also just filed the same notice for related GAAP reasons.

 

[SL6827]

Oh me. I actually thought about trying Spirit in January from Atlanta, if we do decide to head down to the world then. Maybe not? Frontier any better?

 

[EACarlson]

Oh me. I actually thought about trying Spirit in January from Atlanta, if we do decide to head down to the world then. Maybe not? Frontier any better?

Yes, Frontier is in much better shape than Spirit. IIRC, Frontier has tried a few times to purchase Sprit.
The Bankruptcy wasn't filed by Spirit, they were forced into it by it's bondholders. They did the bare minimum to get a friendly judge to let them out.
The GTF failure settlements are keeping the company afloat because they are getting more money from that than they would actually make in profit if they had the planes to fly. More so in that Spirit is currently pretty much losing money on most of the flights it operates.