Spirit Airlines is\u00a0out\u00a0of bankruptcy, hitting its target to emerge in the first quarter, after a crippling few years. CEO Ted Christie says the carrier is leaner and ready to take on competitors, including rival\u00a0Southwest Airlines.<\/p>\n
Earlier this week, Southwest shocked customers by announcing it will\u00a0start charging for checked bags\u00a0for the first time in its half-century of flying, a huge strategy move for the largest domestic U.S. carrier. (There are some\u00a0exceptions\u00a0to Southwest new bag rules, which take effect in late May.)<\/p>\n
\u201cI think it\u2019s going to be painful for a little bit as they find their footing, and we\u2019re going to take advantage of that,\u201d Spirit\u2019s Christie said in an interview Thursday.<\/p>\n
Southwest had been a standout in the U.S. by offering all customers two free checked bags, a perk that has endured recessions, spikes in fuel prices and other crises while most rivals introduced bag fees and\u00a0raised\u00a0them every few years.<\/p>\n
Spirit Airlines, on the other hand, made a la carte pricing common in the U.S., with fees for seat assignments, checked bags and other add-ons. It\u2019s a strategy most large airlines, except for Southwest, have copied in one form or another.<\/p>\n
As Southwest starts charging for bags and introduces its first basic economy class, which doesn\u2019t include a seat assignment or allow free changes, Spirit could possibly win over customers, Christie said.<\/p>\n
Southwest said it would get rid of its single-class open seating model last year.<\/p>\n
\u201cThere at least was an audience of people who were intentionally selecting and flying Southwest because they felt that it was easy. They knew they were going to get two bags,\u201d Christie said. \u201cNow that that\u2019s no longer the case, it\u2019s easy to say that they\u2019re going to widen their aperture and they\u2019re now going to look around.\u201d<\/p>\n
Spirit is far smaller than Southwest and even smaller than it was last year, but it competes with the airline in cities like Kansas City, Missouri; Nashville, Columbus, Ohio; and Milwaukee. If customers look on travel sites like\u00a0Expedia, where Southwest is a new entrant, Spirit\u2019s tickets could be cheaper and appear higher in results, Christie said.<\/p>\n
Other airline executives have also said they expect to win over some Southwest customers.<\/p>\n
Delta Air Lines\u00a0President Glen Hauenstein said at a JPMorgan industry conference Tuesday that there are consumers who choose Southwest based on its free-bag perk \u201cand now those customers are up for grabs.\u201d<\/p>\n
Spirit, for its part, has recently been offering more ticket bundles that include things like seat assignments and luggage.<\/p>\n
The carrier is now focused on returning to profitability. It posted a net loss of more than $1.2 billion last year, more than double its loss in 2023 as it grappled with grounded jets because of a Pratt & Whitney engine recall, higher costs, more domestic competition and a failed acquisition by\u00a0JetBlue Airways.<\/p>\n
Spirit has\u00a0rejected\u00a0multiple recent merger attempts by fellow budget carrier\u00a0Frontier Airlines. Christie said Thursday that nothing is \u201coff the table\u201d and that a fifth-largest airline as a low cost carrier in the U.S. makes sense, but that the airline is focused on stabilizing itself after bankruptcy.<\/p>\n
Through its restructuring process, which started in November, Spirit said it reduced its debt by about $795 million. The transaction converted debt into equity for major creditors. The carrier also received a $350 million equity infusion.<\/p>\n
Spirit plans to relist its shares on a stock exchange but hasn\u2019t set a date yet.<\/p>\n<\/p>\n
Spirit Airlines is\u00a0out\u00a0of bankruptcy, hitting its target to emerge in the first quarter, after a crippling few years. CEO Ted Christie says the carrier is leaner and ready to take on competitors, including rival\u00a0Southwest Airlines. Earlier this week, Southwest shocked customers by announcing it will\u00a0start charging for checked bags\u00a0for the first time in its half-century […]<\/p>\n","protected":false},"author":0,"featured_media":15892,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-15891","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/15891","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=15891"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/15891\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/15892"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=15891"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=15891"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=15891"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}