The White House is working to finalize a rescue financing package for Spirit Airlines, a budget carrier that has been teetering on the edge of collapse. The deal could inject as much as $500 million in loans into the struggling company, sources say.
Spirit has become a cautionary tale of an airline caught in a financial squeeze. The carrier filed for bankruptcy twice in two years as revenue shrank while operating costs climbed. Recent reports suggested the airline was considering liquidation and negotiating with creditors on how to unwind.
Surging fuel prices tied to regional instability have compounded the company's troubles. Those cost pressures have hit budget carriers especially hard, since they operate on razor-thin margins with limited pricing power.
President Trump signaled openness to federal assistance on Tuesday, noting the stakes for workers. "Spirit's in trouble, and I'd love somebody to buy Spirit. It's 14,000 jobs, and maybe the federal government should help that one out," he told CNBC.
Under the proposed structure, the federal government would receive warrants that could give it an ownership stake in the airline in exchange for the cash injection. This arrangement would give taxpayers potential upside if the carrier's situation improves.
Spirit's path to this moment runs through a federal courtroom. In 2024, a judge blocked a $3.8 billion merger with JetBlue on antitrust grounds, ruling that combining the carriers would reduce consumer choice and likely lead to higher fares. That deal would have been Spirit's lifeline.
White House spokesperson Kush Desai stopped short of confirming details about the financing talks but seized the opportunity to blame the previous administration. "Spirit Airlines would be on a much firmer financial footing had the Biden administration not recklessly blocked the airline's merger with JetBlue," Desai said, adding that the Trump administration is monitoring the health of the aviation sector broadly.
Spirit declined to comment on the reported negotiations.
Author James Rodriguez: "Watching Washington throw half a billion at an airline that a judge said shouldn't merge with its only realistic lifeline is peak regulatory whiplash."
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