Spirit Airlines looks like it’s getting spirited away.
The airline is preparing to shut down, after attempts to establish a $500 million bailout from the Trump administration fell through, according to reporting from The Wall Street Journal. Negotiations for the government lifeline had been underway for weeks as Spirit’s cash reserves dwindled, but investors have reportedly balked at the prospect of the federal government becoming a majority owner of the company.
Despite reports saying that the company is prepping to cease operations, a company spokesperson declined to comment when asked by Fast Company, and said that “Spirit is operating as usual.”
On Friday, President Trump said that the government would bail out the airline “if we could do it, we’d do it, but only if it’s a good deal,” adding that “we gave them a final proposal.” He didn’t completely shut the door however, saying that he’d like to “save the jobs,” and told reporters that he would “have something for you today or tomorrow.”
Shares of Spirit Aviation Holdings, unsurprisingly, took a nosedive as well, falling from $1.30 per share to $0.40 shortly after 11 AM ET, but as of around 1 PM ET, had increased back to $1.30. Over the past five days, shares are down almost 35%, however.
Though a Spirit attorney told a bankruptcy court in New York that the company was going to run out of money during an April 23 hearing, the company has not announced or formalized plans to liquidate or shut down. But it has been slowing down its operations. Last year, it cut departures significantly compared to the previous year, and discontinued service to several destinations.
The budget airline has been struggling for years, and has declared bankruptcy twice since 2024. It appears that the recent spike in fuel prices may be serving as the straw that’s breaking the camel’s back, in this case, as airlines across the spectrum try to find ways to contend with increased costs—something that’s not going over well with a potentially price-sensitive market segment that Spirit aims to serve.