economy

Spirit Airlines shutting down after failed effort at government rescue deal

Updated on: May 2, 2026 / 11:15 AM EDT / CBS News

Spirit Airlines shutting down after failed effort at government rescue deal

TL;DR

  • Spirit Airlines has ceased operations immediately due to the failure to secure a $500 million federal bailout.
  • All Spirit flights have been cancelled, and passengers are advised not to go to the airport.
  • Refunds will be automatically processed for tickets purchased directly with the airline via credit or debit card.
  • The airline cited a "creditor issue" and a "sudden and sustained rise in fuel prices" as reasons for the shutdown.
  • Department of Transportation Secretary Sean Duffy disputed the fuel price reason, pointing to Spirit's prior bankruptcy filings and a low-cost model that "wasn't working."
  • The Trump administration was involved in discussions for a bailout, which would have given the U.S. government a 90% stake in the airline.
  • Spirit previously filed for bankruptcy twice since 2024 and has undergone significant job and route cuts.
  • Other airlines, including United, Southwest, JetBlue, and Delta, are offering reduced fares to Spirit customers.
  • American Airlines is reviewing opportunities to add capacity and is preparing a jobs page for displaced Spirit employees.