dailynewsnblog
By David Shepardson and Laila Kearney
May 2 (Reuters) – Major airlines and the U.S. government scrambled to help stranded passengers and employees after bankrupt discount carrier Spirit Airlines ceased operations on Saturday, the industry’s first casualty linked to the Iran war.
The collapse overnight of the carrier following a doubling in jet fuel prices during the two-month-old Iran war will cost thousands of jobs. It is a blow to President Donald Trump, who had proposed $500 million to save Spirit despite opposition from some of his closest advisers and many Republicans in Congress.
Spirit’s demise highlights the unintended consequences of the U.S.-Israel war against Iran, despite an uneasy ceasefire. While Spirit was already struggling to turn a profit before the fuel shock, global carriers are contending with surging jet fuel prices as Iran continues to halt nearly all traffic through the Strait of Hormuz and the U.S. Navy blockades Iranian ports.
Transportation Secretary Sean Duffy told a news conference that creditors had rejected the deal despite intense efforts by the Trump administration to keep Spirit alive. The collapse will result in the loss of about 15,000 jobs of Spirit employees and contractors, the airline said.
Some of Spirit’s largest creditors, including Ken Griffin’s Citadel, a major hedge fund and one of the airline’s top bondholders, opposed the government‑backed rescue, arguing the terms would dilute the value of their claims by placing federal financing ahead of existing debt.
FOND TRIBUTES ON SOCIAL MEDIA
No U.S. carrier of Spirit’s size – it accounted for 5% of U.S. flights last year – has liquidated in two decades. Spirit helped keep fares lower in markets where it competed against major carriers.
On social media platform X on Saturday morning, where travelers often go to vent about delayed or canceled flights, many sent nostalgic posts about the budget airline’s closure.
“Goodbye SpiritAirlines. Those of us in the “D” (Detroit), or previously known as your Second Hub of #DTW, will miss ya,” said @IUTruthtellers2.
Others on X posted stories of their experiences flying on Spirit, including the hashtag “RIP” in their messages.
At the Orlando International Airport, a digital departure display sign was filled with bright red notifications of canceled Spirit flights that had destinations everywhere from Nashville to San Juan, Puerto Rico.
United Airlines , Delta Air Lines , JetBlue and Southwest are all capping ticket prices for Spirit customers who now need to rebook canceled flights and customers must provide a Spirit flight confirmation number to qualify. Rival airlines are also offering free seats to help Spirit employees get home.
