The Points Guy believes that credit cards can transform lives, helping you leverage everyday spending for cash back or travel experiences that might otherwise be out of reach. That's why we publish a variety of editorial content and card comparisons: to help you find a great card to turn your goals into reality.
Our site may earn compensation when a customer clicks on a link, when an application is approved, or when an account is opened with our partners, and this may impact how or where these products appear. While we don't cover all available credit cards, our editorial team creates and maintains all of the analysis of these cards, and our content is not influenced nor subject to review by any credit card company, bank or partner prior to (or after) publication. Please view our advertising policy and product review methodology for more information.
Advertiser disclosure
The Points Guy believes that credit cards can transform lives, helping you leverage everyday spending for cash back or travel experiences that might otherwise be out of reach. That's why we publish a variety of editorial content and card comparisons: to help you find a great card to turn your goals into reality.
Our site may earn compensation when a customer clicks on a link, when an application is approved, or when an account is opened with our partners, and this may impact how or where these products appear. While we don't cover all available credit cards, our editorial team creates and maintains all of the analysis of these cards, and our content is not influenced nor subject to review by any credit card company, bank or partner prior to (or after) publication. Please view our advertising policy and product review methodology for more information.
Tragedy
Spirit's bright yellow planes are grounded for good — a sad ending for the storied budget carrier
David Slotnick is TPG's contributing aviation editor. He covers the ins and outs of the airline industry.
May 2, 2026 • 7 min read
Comments
By commenting, you agree to our Community Guidelines to help create a positive space for conversation. The responses below are not provided or commissioned by the bank advertiser, our partners, or The Points Guy (“TPG”). They have not been reviewed, approved, or otherwise endorsed by any of these parties. All responses are submitted by individual contributors, and neither the bank advertiser, our partners, nor TPG are responsible for ensuring that all posts and/or questions are answered.
Related stories
Quick summary
Spirit Airlines has ceased all operations immediately after running out of cash, leaving thousands of travelers stranded and employees without jobs.
The shutdown follows months of financial struggles, including two bankruptcy filings since late 2024 and failed attempts to secure a government bailout or loan.
Rising jet fuel costs, grounded aircraft due to engine issues and blocked merger attempts contributed to the airline's collapse.
Spirit's ultra-low-cost model, known for unbundled fares and add-on fees, influenced the broader airline industry but ultimately could not withstand recent challenges.
What to consider
Travelers with existing Spirit bookings will need to seek alternatives, as all flights are canceled and the airline's assets will be liquidated.
Other airlines may offer special 'rescue fares' to assist stranded Spirit customers, but availability and terms will vary.
The shutdown highlights the risks faced by budget carriers during periods of high fuel prices and industry consolidation.
What you'll miss from the article
Detailed guidance on what affected travelers can do next and how other airlines are responding to assist Spirit customers.
Generated by AI with support from our editorial team.
Spirit Airlines is no more.
The budget carrier said early Saturday that it would cease all service immediately after running out of cash amid a surge in fuel costs and failing to secure either a government bailout, or a loan from creditors to keep it afloat.
It was a disappointing but seemingly inevitable end for the famed budget airline, known for its big, bright yellow planes and ultra-cheap fares (but add-on fees for almost everything else).
Spirit had hoped to exit bankruptcy as a restructured airline this summer. However, an 80% increase in jet fuel prices since the start of the U.S. war in Iran meant that, even if it managed to exit bankruptcy, the revamped Spirit would still likely have been unable to turn a profit.
The sudden shutdown left thousands of travelers stranded across the country this weekend, and left thousands more scrambling to try and salvage shattered travel plans.
Beyond that, Spirit has roughly 9,500 employees who are now left without jobs, according to a source familiar with the matter. (Although that number increases to 17,000 when including contractors.)
COMPLETE COVERAGE FROM TPG: Spirit Airlines shuts down
Spirit's shutdown comes after months of uncertainty and speculation that the carrier's operations could be nearing an end.
The airline was close to running out of cash during the holiday travel season, but managed to secure a last-minute infusion from its creditors. Several weeks ago, further reports suggested the airline was days or weeks away from being forced to shut down and liquidate.
While Spirit had approached the federal government about a $500 million bailout, some of Spirit's creditors opposed such a deal, which would see the government take up to a 90% equity stake in Spirit; some other airline executives and politicians also opposed such a deal.
It also wasn't clear whether a bailout would actually help turn things around, or whether it would just delay the inevitable.
A long financial struggle
Spirit has been cutting routes and staff for months as it has tried to stem its losses, and it closes as a much smaller airline than it was in its heyday.
The airline struggled to return to profitability after the peak of the coronavirus pandemic, even as competitors were able to harness travel demand emerging from lockdowns and have remained successful since. One major head wind was an ongoing issue with the Pratt & Whitney engines that powered the airline's fleet of A320neo-family jets, which left dozens of the airline's jets grounded. While the airline received compensation, it was not enough to make up for the grounding.
In 2022, Frontier and Spirit announced plans to merge, before JetBlue made a higher offer to acquire Spirit, which was accepted by shareholders. The Biden administration sued the airlines to try and block the merger, claiming that it would be anticompetitive and lead to higher prices for consumers.
JetBlue and Spirit Airlines aircraft on the ground in Fort Lauderdale. JOE RAEDLE/GETTY IMAGES
During a four-week trial in federal court in Boston, which TPG covered extensively, Spirit argued that it likely could not survive without some sort of merger. JetBlue argued that by joining, the combined airline could compete more effectively with the four major U.S. airlines (American Airlines, Delta Air Lines, Southwest Airlines and United Airlines) that together control about 80% of the U.S. air travel market.
The merger was blocked by Judge William G. Young, an appointee of President Ronald Reagan, who wrote that under the Clayton Act of 1914, the merger was anticompetitive.
"Spirit is a small airline. But there are those who love it," Judge Young wrote in the decision.
"To those dedicated customers of Spirit, this one's for you," he added.
In its Saturday statement, the U.S. Department of Transportation took partisan aim at the previous administration for blocking the merger.
Spirit has spent the last year trying to reposition itself as a dynamic airline with both its famous low-cost base fares and a la carte pricing for add-ons, as well as things like packaged fares that include things like on-board snacks and even first-class seats. It was trying to take advantage of the trend that premium revenue is increasingly crucial for U.S. airlines.
However, it appears to have been too little, too late.
The end of the 'bus with wings'
The death of Spirit marks the end of a storied budget airline that, despite whatever complaints people may have had, offered cut-rate fares that made travel more accessible to more people.
Unbundled fares, with add-ons for everything from bags to seat selection, proved to be so competitive that they forced the legacy airlines to introduce basic economy. Spirit, for instance, was the first airline to begin charging for carry-on baggage.
Even so, you always knew what you were getting with Spirit. The airline was proud of its scrappy and frugal image, and rarely shied away from it. The carrier's former CEO, the late Ben Baldanza, who pioneered the no-frills business model in the U.S. and transformed Spirit into the budget airline we all know today, famously referred to the airline as "a dollar store in the sky" and "buses with wings."
And as recently as 2019, the model worked, with Spirit turning a profit going into the pandemic.
But the competition from bigger airlines' basic economy fares, with more flights on the same routes, better reputations and tempting loyalty programs bolstering the bare-bones offering, turned out to be another blow to Spirit.
Spirit Airlines began as a charter airline in the 1980s, then changed its name to Spirit and began regular scheduled service in the early 1990s.
As for what happens next: Spirit's creditors will liquidate the airline's assets to recoup their costs, selling everything from airplanes and leases to gates and slots, ground equipment and even quotidian items like desktop computers and office furniture.
This is a developing story. Stay tuned to TPG for more information on what consumers affected by the shutdown can do, and for up-to-date news on Spirit's shutdown.
By commenting, you agree to our Community Guidelines to help create a positive space for conversation. The responses below are not provided or commissioned by the bank advertiser, our partners, or The Points Guy (“TPG”). They have not been reviewed, approved, or otherwise endorsed by any of these parties. All responses are submitted by individual contributors, and neither the bank advertiser, our partners, nor TPG are responsible for ensuring that all posts and/or questions are answered.
