Budget carrier Spirit Airlines goes belly up

Spirit Airlines officially went belly up on Saturday. After years of financial trouble, the budget carrier known for its yellow planes cancelled thousands of flights and ended employment for around 17,000 people. It announced what it characterized as its orderly wind-down and an end to all flights and customer service in a statement early that morning.

Spirit said soaring jet fuel costs and a lack of funding made it impossible for the company to move forward. Spirit has gone bankrupt twice, first in November 2024 and then less than a year later in August 2025. The 34-year-old airline said it attempted to restructure to continue, but it did not have the hundreds of millions of dollars of liquidity needed to run the business. While President Donald Trump on Friday told reporters he had considered a government bailout for the airline, a deal was ultimately not reached.

What happened to Spirit travelers Saturday? Passengers and employees affected by the cancelled flights were able to procure tickets through other airlines. United Airlines, Southwest Airlines, American Airlines, and JetBlue Airways all said they expanded their services to offer price-capped tickets to stranded travelers. Additionally, Spirit said it would refund any cancelled flights purchased directly from the airline, but passengers would not receive reimbursement for other expenses, such as emergency hotels.

What has the Department of Transportation said about the closure? U.S. Transportation Secretary Sean Duffy blamed the Biden administration for the airlines’ shutdown. He said the Biden administration’s block of a JetBlue and Spirit merger in 2024 led to hurting the American consumers.

Dig deeper: Listen to Moneybeat as financial analyst David Bahnsen discusses what led to Spirit Airlines’ demise.