Spirit Airlines, the parent company of Spirit Aviation Holdings, has been teetering on the brink of bankruptcy since November 2024. Now, the company has announced that its restructuring plan has reached another significant milestone.
In a statement released on Tuesday, the financially troubled airline revealed that it has reached a preliminary agreement on key terms of a “restructuring support agreement” (RSA) with its existing debtor-in-possession (DIP) lenders and secured noteholders. This agreement will provide the necessary funding for Spirit Airlines to complete its restructuring and help optimize its fleet, route network, and cost structure.
As a result, Spirit Airlines is expected to emerge from bankruptcy protection (Chapter 11) as early as late spring or early summer this year.
Spirit Airlines CEO and President Dave Davis stated in the release, “This preliminary agreement is the culmination of months of hard work and will help propel Spirit Airlines through its transformation. Spirit Airlines is poised to emerge as a stronger, more operationally streamlined, and profitable market competitor, continuing to offer value that meets consumer expectations at satisfying prices.”
Davis highlighted that the airline will adjust its routes flexibly based on peak consumer demand, increasing flights during high seasons and reducing them during off-peak times. Additionally, the company plans to tailor its offerings to cater to seasonal demands in different markets.
Moreover, Spirit Airlines plans to introduce more premium options, including Spirit First and Premium Economy products. Through these initiatives, the company aims to maintain its competitive pricing position in the airline industry while focusing on “value.” Spirit Airlines will also continue its passenger loyalty program.
Once the company officially exits bankruptcy protection, its cost structure is expected to see significant improvements. It is estimated that its debt and lease obligations will decrease from approximately $7.4 billion before the restructuring to around $2.1 billion afterwards.
Davis added, “I am immensely grateful for the dedication and steadfast commitment shown by team members to passengers throughout the entire restructuring process. I also want to thank passengers for continuously choosing Spirit Airlines, allowing us to connect everyone closely with loved ones and important destinations.”
During the transitional period before the completion of the restructuring process, passengers can continue to book flights, travel, and use tickets, vouchers, and loyalty points as usual.
Originally filed for Chapter 11 bankruptcy protection in November 2024, Spirit Airlines temporarily exited the bankruptcy process in March 2025. However, in August 2025, Spirit Aviation Holdings voluntarily submitted another Chapter 11 application, indicating the need for more time to continue negotiations with creditors.
Just days before that application, Frontier Airlines, a competitor, pledged to become the preferred low-cost airline in the top 20 metropolitan areas in the United States. Simultaneously, Frontier Airlines opened 20 new routes from Dallas, Detroit, Houston, Baltimore, Fort Lauderdale in Florida, and Charlotte in North Carolina, with ticket prices starting as low as $29.
In response to Spirit Airlines’ August application, United Airlines announced in September last year the expansion of winter flights to 15 warm-destination cities, including Fort Lauderdale, Orlando, and Las Vegas.
Spirit Airlines, headquartered in Dania Beach, Florida, provides budget airline services in the United States, Latin America, and the Caribbean regions. Passengers typically pay basic fares and can add on services such as baggage, seat selection, and dining as needed. The airline currently employs over 10,000 staff members.