It was recently reported that Spirit Airlines might be on the verge of liquidation, and that it could happen within days. The airline is in Chapter 11 bankruptcy (for the second time in two years), and while the company was hoping to emerge from bankruptcy by early summer, that strategy seemed hopeful at best. As you might expect, the current price of jet fuel has probably thrown a wrench in those plans.
On Friday, we learned how the airline is reportedly asking the government for a bailout, and on Monday we’ve learned more details about what exactly this request looks like.
In this post:
Spirit Airlines asks for government bailout to stay in business
On Friday, April 17, 2026, The Air Current was first to report that Spirit has asked the Trump administration for hundreds of millions of dollars in emergency funding to be able to stay in business, to offset the increase in the cost of jet fuel. This is according to “sources familiar with the discussions.”
Now on Monday, April 20, 2026, Bloomberg is reporting more details of this request. The company isn’t just asking for “free” cash, but instead, wants to offer the government equity in exchange for the bailout. The proposal seems to be inspired by the deal brokered by the White House last year, where the government became one of the biggest shareholders in Intel Corp, in a bid to bolster the chipmaker’s domestic initiatives.
A spokesperson for the Department of Transportation has blamed some of Spirit’s current problems on “the failures of the last administration,” including blocking of the JetBlue merger (I completely agree that merger shouldn’t have been blocked). Bigger picture, value airlines in the United States are reportedly meeting with Transportation Secretary Sean Duffy, as he wants to determine the financial health of these airlines.
We’ll see what comes of this. Spirit’s request is one thing, but it’s clear more broadly that the government wants to look at the current situation at airlines, and determine for how long it’s sustainable. Duffy has tried to downplay the impacts of the current crisis, suggesting we’re seeing a “small spike” in jet fuel, and claiming that airlines are absorbing most of those costs, and suggesting airfare will be cheaper in the long run.
Should airlines get financial support from taxpayers?
In fairness, there is a precedent for taxpayers bailing out airlines, as we saw at the beginning of the coronavirus pandemic. At the time, the CARES Act provided airlines with over $50 billion in funding so that they could stay in business, given the extent to which demand dropped off a cliff. In this case it’s not demand falling off a cliff, but costs skyrocketing, to the point that operating costs are unsustainable.
As I see it, there are two different topics here — Spirit’s situation specifically, and then the overall question of whether airlines should get support.
On the topic of Spirit… I really respect the airline, I think it gets an unfairly bad rap, the airline helps keep the legacies in check, and I’m sad if employees lose their jobs due to liquidation. However, this just seems like an intent to delay the inevitable. Spirit’s financial situation has been very bad for a very long time, and based on what we know, the carrier’s margins are still awful.
I don’t want to be unsympathetic, but I don’t think taxpayer money should go toward keeping one struggling airline alive, essentially just subsidizing airfare for a matter of months. For that matter, the government taking a stake in individual airlines just seems like a bad idea for competition.
The topic of broader industry support is also one that I think will be discussed more in the coming weeks. I’m not sure what the legal mechanism is by which this could be done, but we’ll see how this all plays out. If oil prices stay very high, even the world’s most profitable airlines will be losing money, and the industry could be radically reshaped in a short period of time.
It’s honestly hard to discuss this topic without being accused of “oh, don’t get political,” even though global politics impacts virtually every aspect of the world, so can’t be ignored. Political disagreements is what caused this current conflict.
I guess part of the issue with discussing this topic honestly is that Trump is constantly downplaying what’s going on, and misleading the public when it comes to the state of the war. I mean, a few days ago he claimed the Strait or Hormuz was open, and would never close again, suggesting that’s something Iran had agreed to. A couple of days later, it closed again.
It really feels like so much that’s going on is about market manipulation for the purposes of insider trading, rather than an actual accurate reflection of what’s going on. So that also makes it hard for everyone to plan, because no one actually knows what’s going on.
I’m sure some people will accuse me of “TDS,” but I don’t believe the current conflict is anywhere close to over. And if you disagree with me, please, by all means go on record and say so. Trump claims he has ended eight wars, and Iran is the ninth war he’s ending… it’s hard to take that narrative seriously.
If oil prices really go back to where they were before the conflict within a few weeks, things should mostly be fine. But personally I think we’re entering a new era here, both in terms of higher oil prices, and in terms of global unrest.
If the impacts of this will continue to be felt for many months or even years, then the airline industry could be radically transformed. Something needs to be done, because airlines just can’t sustain these kinds of costs. It’s a low margin industry under the best of circumstances, and a massive, unsustainable money pit under the worst of circumstances.
Bottom line
Spirit Airlines is asking the Trump administration for an emergency bailout worth hundreds of millions of dollars, as the airline is on the verge of liquidation. The airline is framing this as wanting the government to take an equity stake in it, which seems a little absurd.
It’s one thing if Spirit just had some minor temporary issues, but the airline hasn’t made money since before the pandemic, and I don’t see what the company’s plan is to actually become profitable. We’ll see if anything comes of this, because otherwise, Spirit’s days may be very numbered.
One thing is for sure — if jet fuel prices stay where they are, the overall industry is going to need some help very soon, if competition is to be preserved. Otherwise we’ll see bankruptcy after bankruptcy, and airlines shrinking massively.
What do you make of Spirit’s bailout request?
Why didn't the government bailout Eastern, PamAm, or TWA? Because doing so would be illegal—or at least, could not be done without congressional approval. Not that that will stop this goon squad from doing it. It will also need bankruptcy judge approval.
Spirit stock up 200% because you jokers thought the government wouldn't come up with a bail out package.
As Spirit has recently been ranked “Best overall U.S. Airline 2026”, Mr ‘rump would be mad not to offer American tax dollar assistance …. Yes?
Trump caused the problem. Give Spirit money. They need it. American consumer needs bailout. We need the competition.
Why is it other airlines aren't lining up for a bailout? Could it be that an airline that can't generate enough revenue to cover it's costs should not stay in business?
It's a hard No for me to pay for this experiment in flying Section 8 housing. Spirit waited too long to realize that it's core customer would never be profitable and was creating a permanent bad reputation among flyers that they might be able to make money on.
Give 'em a little time, Georgie. Thanks to your God King, they'll all want/need them, soon. (And, a *deep sigh* for your lack of empathy/disregard for those who aren't Concierge Keys like you.)
I'm only an Executive Platinum and I have no sympathy for the inbred trailer trash that fly Spirit or Frontier or the tight-fisted super-annuated cheap-asses that fly Allegiant or Sun Country. If all of them died, airlines and people, tomorrow, I would breathe a sigh of relief.
But Ord, all those “Trailer trash” votes placed Spirit above the Airline which you paid to become “An Executive Platinum” don’t you know?
Yes Ord, Spirit has recently been ranked “Best overall U.S. Airline 2026”, don’t you know?
Tim does not read and understand links that other commentators attached to their responses. He does not accept comments that contradict his mind set. I vividly remember sending a link in a response to his bs claim last year that Delta did not receive Covid $$$. Today, he continues his tactic of denial, deflection and defiance. When a comment or response attracts multiple counter-arguments, we know it is a hogwash. It will hit him hard...
Tim does not read and understand links that other commentators attached to their responses. He does not accept comments that contradict his mind set. I vividly remember sending a link in a response to his bs claim last year that Delta did not receive Covid $$$. Today, he continues his tactic of denial, deflection and defiance. When a comment or response attracts multiple counter-arguments, we know it is a hogwash. It will hit him hard when readers do not respond to his outlandish rubbish comments.
We are all old enough to live through 2008 great recession. Henry Paulson was Treasury Secretary of record and former Goldman & Sachs Chairman and CEO. He elected to let Lehman Brothers fall because no banks wanted to assume such horrific debts on the balance sheet. We all have to make decisions what to keep and what to let go. Nothing is illegal, unfair or unjust about it. Congress has no contingency resources to save any failing big business as Trump is allocating all resources to Iran war and subsequent wars, both foreign or domestic. Trump is looking out for his oligarchs and plutocrats, not those at the bottom of the totem pole. Trump will condemn Spirit to the graveyard. There is nothing in Spirit for Trump to benefit from. US capitalism is not Adam Smith's The Wealth of Nations capitalism. It is crony capitalism when the government picks and chooses winners and losers. It awards huge government contracts to dominant companies in the industry, despite the fact that those companies failed to deliver their promises as agreed in the contracts.
To those who whine about keeping politics out of travel blog, it is not politics. It is knowledge. It is education. It is current event which is interrelated to travels. They either refuse to educate themselves or reject opinions contradictory to theirs when they have no facts to support their claims.
I have no idea what this Tim Dunn fellow has to say. I never read his comments. Same with Eskimo, BAe…, 1990, and a couple of others. Keeps my blood pressure under control and frees up lots of time.
Beyond ironic that the airline that talks about the "government's cut" when advertising fares to "show people what we make and the government takes," is crying for its own government bailout.
Spirit is likely gonna get the Lehman treatment, which is a shame, because there are real people who work and travel with the company. This could be the beginning, not the end of airline troubles, thanks in no small part to macro issues (oil, K-shaped economy).
If there is to be a taxpayer bailout for this and/or all carriers (either loan or grant), we should ensure consumer protections, like an EU261 equivalent, prohibit stock...
Spirit is likely gonna get the Lehman treatment, which is a shame, because there are real people who work and travel with the company. This could be the beginning, not the end of airline troubles, thanks in no small part to macro issues (oil, K-shaped economy).
If there is to be a taxpayer bailout for this and/or all carriers (either loan or grant), we should ensure consumer protections, like an EU261 equivalent, prohibit stock buybacks and excessive executive bonuses. However, I expect none of that because we are lead the most corrupt people ever right now. Vote for better leaders in less than 200 days, please.
And pretty sure NK at EWR is toast. The reports of flights today basically indefinitely delayed/cancelled. LGA still limping on. It’s sad. Hope those affected find alternatives and relief soon.
As ever, great take Lucky.
Re: Spirit... I'm truly amazed their operation hasn't fallen apart. Spirit is lucky the other airlines aren't hiring many pilots right now. Spirit wouldn't even be able to operate an airline if the pilot flow to the US3 was normal.
heh, can you imagine if we had the '22-'24 tight labor markets (especially in travel!) now in '26? NK would be cooked, rested, and served.
spot-on analysis, as always
You barely talked about the topic and mostly talked about your pinion on the oil issue and Iran war.
The US Gov't didn't save Pan American. Year after year the gov't did't allow Pan Am to have domestic routes which combined with admittedly management arrogance and poor labor relation killed it. United and Delta severed off the limbs and eventually Delta pulled the plug. The US taxpayer paid the bill. The current administration IMHO is not going to support a 'loser' so I'm guessing Spirit is a goner...
The US Govt cannot just aid one airline and not the others. That could be challenged legally. Historically, when the US Govt has bailed out an airline (e.g. during Covid), it developed a formula to extend aid to other airlines, even if they did not ask for it, in order to have a level playing field. For example, aid could be distributed on the basis of total revenue, so whatever Spirit gets, Delta and United...
The US Govt cannot just aid one airline and not the others. That could be challenged legally. Historically, when the US Govt has bailed out an airline (e.g. during Covid), it developed a formula to extend aid to other airlines, even if they did not ask for it, in order to have a level playing field. For example, aid could be distributed on the basis of total revenue, so whatever Spirit gets, Delta and United would get far more in absolute terms. Incidentally, during Covid, the US was by far the most generous Govt to its airlines - e.g. it funded 70-80% of labour costs of US airlines (i.e. all crew and direct labour costs but not management salaries). The UK Govt funded 15% of UK airlines’ labour costs and other EU countries c.30%. Latin American Govts provided nothing to their carriers, resulting in most of them with US stock listing entering Chapter 11 filings.
Spirit should just ask trump for a few polymarket tips.
You catch the most recent Last Week Tonight? John covered prediction markets… *facepalm*
"The rest of the unskilled workers are in a growing economy and should be okay, if they persist."
What growing economy? Real question.
I know you mean well, Willy.
OP referring to workers as ‘unskilled’ really is insulting and demeaning; they all have skills, value, and are deserving of dignity. I wish we wouldn’t normalize this harmful anti-worker framing.
Support Spirit?
Not a chance. In the first BK, the C Suite all exercised BK clauses in the employment agreements and were collectively paid millions.
It was suspected that Spirit could have turned itself around with the millions they had in the bank, but it all went to the former executives when they left.
When a C Suite makes a biz decision based on not wanting to lose a contractual payout and the board agrees,...
Support Spirit?
Not a chance. In the first BK, the C Suite all exercised BK clauses in the employment agreements and were collectively paid millions.
It was suspected that Spirit could have turned itself around with the millions they had in the bank, but it all went to the former executives when they left.
When a C Suite makes a biz decision based on not wanting to lose a contractual payout and the board agrees, then that business needs to die forever.
No more Spirit.
Supporting a dying airline will be the least of Governor Donald's concerns in a couple of months. The economy will tank. Production does not ramp up quickly. Facilities that have been damaged or closed due to lack of raw input take weeks to come back online. Even if America's invasion of Iran ended tomorrow, aviation fuel, natural gas and other oil products would still run out in many parts of the world, and will remain...
Supporting a dying airline will be the least of Governor Donald's concerns in a couple of months. The economy will tank. Production does not ramp up quickly. Facilities that have been damaged or closed due to lack of raw input take weeks to come back online. Even if America's invasion of Iran ended tomorrow, aviation fuel, natural gas and other oil products would still run out in many parts of the world, and will remain expensive everywhere until at least next year. Flights will get cancelled this summer. Airlines will stop flying entirely for months because they either cannot afford fuel or cannot get it, or because their customer base has dried up because it can no longer get to a connecting airport.
This take already aged well - Hormuz closed again! Who knows. But no need for a bailout for banana airlines.
No, we should not support an airline so that low income people can continue to fly. I lived in the days of the CAB and most Americans drove or took a bus. No one screamed about racism or social inequities because they could not afford an airline ticket.
Although I'll have less airport and airplane meltdown videos to watch.
Will the Trump Administration bail out Spirit? I'd give it 50/50 chance.
The MAGAts pretty much want a bailout. That's because NK is the only airline that most of the pinhead inbreds can afford to fly. White trash with money fly Delta. White trash without money fly Spirit.
What kind of white trash call ORD their second home?
It comes from the fact that I spend almost as much time at ORD than I do my actual home. A little sensitive, are we? Go and take it out on your wife/sister.
I hope you work there and are not forced be away from home so much on business travel. Unless of course you prefer to be away from home.
…. ORD’s family probably prefer it when he is in ORD …. :-)
Bailout can easily get by simply renaming the airline to TDS airlines standing for (Trump's Devoted Spirit)
If Spirit give trump 50 bucks towards that illegal ballroom they'll get this bailout.
I am confused by the terminology. Isn't derangement believing what Trump says?
I don't think you have TDS, but exactly the opposite
Privatize the profits socialize the losses? No thanks. If a business can’t stay afloat, let it sink. Those laid off will eventually find other means of employment.
Ben,
Maybe you can do a story about the supply-chain and economics of airline/jet fuel? My understanding is that airlines contract out months (if not years) in advance for fuel and have or should have some contingencies for huge spikes in prices and availability. Didn't Delta buy their own refinery years ago to mitigate against just things? Sure, the price of oil, gas, and jet fuel might be going up (other than the huge...
Ben,
Maybe you can do a story about the supply-chain and economics of airline/jet fuel? My understanding is that airlines contract out months (if not years) in advance for fuel and have or should have some contingencies for huge spikes in prices and availability. Didn't Delta buy their own refinery years ago to mitigate against just things? Sure, the price of oil, gas, and jet fuel might be going up (other than the huge drop today) - but was is the real impact on the overall industry and business. It is not like an airplane just pulls up to a local BP/Chevron/Shell/etc station and say "fill'er up, here is my credit card".... although maybe if Spirit had their own credit card they could use it to pay for gas (didnt you have a story about someone putting $1m on jet fuel on an AmEx years ago?) and leverage it against a loyalty program like the Big Boys?
Even a primer on that would require a journalistic level of research, analysis, synthesis and composition that would be... well beyond the scope and abilities of this blog.
There should be no bailouts for any or all airlines without meaningful worker and consumer protections (like EU261) included as a stipulation.
Of course this government is looked into a bailout. Conservatives love oligopolies and they love to privatize profits and socialize losses so this is right up their alley.
What BS. No true fiscal conservative would prefer oligopolies to other forms. None would want to transfer private losses to the public. Trump and many Republicans in Congress are not true fiscal conservatives.
Is it not the case that the U.S. Airline Industry is a true “Oligopoly”?
laissez faire, that’s how capitalism works. Harsh but, if you can’t build a better mousetrap, you will not succeed. The pilots and mechanics will find a better, more secure work place, because they have licenses that are a ticket to a good life and great earnings. The rest of the unskilled workers are in a growing economy and should be okay, if they persist. Screw the lenders, they rolled the dice and lost. No one...
laissez faire, that’s how capitalism works. Harsh but, if you can’t build a better mousetrap, you will not succeed. The pilots and mechanics will find a better, more secure work place, because they have licenses that are a ticket to a good life and great earnings. The rest of the unskilled workers are in a growing economy and should be okay, if they persist. Screw the lenders, they rolled the dice and lost. No one should bail them out. Airfares in this country are too low, Spirits than demise will help balance the scales. Hey there’s always F9 and Allegiant for the cheap fares. @Ben, I don’t think you necessarily suffer from TDS, at least your blog is even handed.
you do realize that AA's profit margin over the past 10 years is far worse than NK's?
your logic is sound until it is applied to your employer
How far back do you want to go back with this idea, Tim? 10 years may help you out but 20 won't since your beloved delta was completely bankrupt and so was NW.
Pretty obvious that a 10 year look back on profitability is useless (though in absolute terms, AA was far more profitable than nK over that term) since the business plan between the two airlines is clearly proven -- NK lost.
Profit margin is irrelevant when comparing different business models.
You need to compare return on invested capital.
LCCs are bad at converting capital into revenue, so they mathematically need better "margin", which is a percent on revenue and not on capital committed, in order to return the same amount on the capital invested.
Math 101.
But, AA has lots of cash. NK is out of cash and ideas.
However Pilot, Spirit has recently been ranked “Best overall U.S. Airline 2026” …. :-)
The real problem with this will be the likes of Delta lining up with their hands out, too. Where does this end? Companies should borrow at market rates or file bankruptcy, not get government handouts. Maybe Jared can start an airline and get a bailout while their at it.
Delta didn't need covid money; neither did Southwest - both pulled down $10 billion lines of credit within days after covid shutting down the economy.
But you can't hand out subsidies to one group of airlines (low cost carriers) and not everyone else, including DL which has lower fuel costs because of its refinery.
and Ben is right. Crude and refined products are nowhere close to flowing normally - even before considering that reserves...
Delta didn't need covid money; neither did Southwest - both pulled down $10 billion lines of credit within days after covid shutting down the economy.
But you can't hand out subsidies to one group of airlines (low cost carriers) and not everyone else, including DL which has lower fuel costs because of its refinery.
and Ben is right. Crude and refined products are nowhere close to flowing normally - even before considering that reserves of oil and jet fuel worldwide are well below normal if not close to "the fumes"
Duffy is doing his job of taking the pulse of the industry but it is hard to believe that the government will intervene in the airline industry because of high fuel costs; demand is still strong and there are scores of industries that are being impacted by high fuel costs and for related products
"Delta didn't need covid money;"
Hello there delusion lol
Delta had negative revenue like everyone else. Let's not rewrite facts, Tim.
Delta would've been in Chapter 11 or Chapter 7 by June, at best. Others before it but Delta was Chapter 7 by June without bailout money.
Your rewrite of written history is amusing but just stupid, per usual.
Stop making sh*t up
@Tim
Direct from Financial Times: ‘Like all the big US carriers, Delta received a portion of a $50bn government bailout to support its payroll’. So, no matter the amount they did get help to get through it all.
https://www.ft.com/content/f9a9fee0-9b96-49c2-a29a-aee27d98e39d?syn-25a6b1a6=1
This is why Tim believes so because of his beloved Bastian:
https://liveandletsfly.com/delta-ceo-denies-bailout/
But Matthew correctly disagrees with Bastian and even used OMAAT as his support to do so.
@Tim
Direct from Financial Times: ‘Like all the big US carriers, Delta received a portion of a $50bn government bailout to support its payroll’. So, no matter the amount they did get help to get through it all.
https://www.ft.com/content/f9a9fee0-9b96-49c2-a29a-aee27d98e39d?syn-25a6b1a6=1
This is why Tim believes so because of his beloved Bastian:
https://liveandletsfly.com/delta-ceo-denies-bailout/
But Matthew correctly disagrees with Bastian and even used OMAAT as his support to do so.
To quote one of the less great James Bond movies "Why can't you just be a good boy and die?"
Just let the airline fold, if all they do is keep the market in check by selling financially non viable fares, then they deserve to fail. They can go to Ireland and visit Ryanair, it is very possible to be highly profitable and selling 20 euro base fares. It is not the fares per se, it is their overall setup and operations.
And Ryanair is even burdened by EC/UK261.
sorry i'll only take commentary seriously from shrewd political observer Dave Stafford. A highly trained, educated analyst.
You misspelled "analist".
When they run out of arguments, they just assert "TDS".
It's a lazy, weak retort that reveals that MAGA is intellectually as well as morally bankrupt.
100%
The irony is that it is his supporters who are the most deranged of all.
There is no way on God's Green Earth that any of my tax dollars should go toward keeping Short Bus Airlines alive. If it shut tomorrow, nothing of value would be lost.
Ditto
Oof, why prolong the agony? I know that winding-up will put a lot of employees and suppliers in a difficult or even precarious position, but it's best to put a bullet in a crippled horse than to let it hobble about in distress.
Jobs, people, lives… that’s why keep going on.
It's nothing more than delaying the inevitable at this point.
I don’t blame Ben for the Trump commentary, but in the interest of exposing both sides: this is what you get after ivory tower Lina Khan decided to block the frontier merger. The woman never worked a day of her life in the private sector and is clueless. tyvm!
No. Lina Khan was correct, and we need more, not less, anti-trust enforcement. Healthy competition, not monopolies.
Perhaps, but the consumer welfare standard of antitrust and Khan’s neobrandeisianism is not.
More generally, 3 airlines the market 3 ways is actually quite competitive and not a problem at all.
I think you meant the JetBlue-Spirit merger (not Frontier) but I don't want to put words in your mouth. If that merger had been approved, JetBlue & Spirit both, would be facing liquidation this week...
While it will be sad to see Spirit go I don't think taxpayers should be bailing them out
No and no again. Their demise will free resources for the rest of the industry.
I’m just here for the comments