Spirit Aviation Holdings, the parent company of Spirit Airlines, has filed a Restructuring Support Agreement (RSA) and Plan of Reorganisation with the U.S. Bankruptcy Court for the Southern District of New York, marking a further step in the ultra-low-cost carrier’s Chapter 11 restructuring.
The airline said the agreement reflects continued support from its debtor-in-possession (DIP) lenders and secured noteholders and outlines the financial framework for Spirit’s expected emergence from Chapter 11 by early summer.
The restructuring plan centres on a smaller fleet, lower debt and a more focused network as the airline attempts to stabilise its finances following mounting cost pressures across the industry.
Under the plan, Spirit intends to “rightsize” its fleet to between 76 and 80 aircraft by the third quarter of 2026, primarily consisting of Airbus A320 and A321ceo aircraft. The move follows previously announced fleet adjustments and is expected to reduce the airline’s debt, lease obligations and overall aircraft costs. Spirit said it anticipates adding aircraft again between 2027 and 2030 as profitable growth opportunities emerge.
The airline also plans to optimise its route network by focusing on stronger markets such as Fort Lauderdale, Orlando, Detroit and the New York City area, while increasing aircraft utilisation on peak travel days and reducing off-peak flying.
Spirit said it would also expand its higher-yield product offering, including adding a third row of its Big Front Seat® product and continuing the rollout of Premium Economy seating, while maintaining its ultra-low-cost pricing model.
Financially, the restructuring is expected to significantly reduce the airline’s balance sheet obligations. Spirit said its combined debt and lease liabilities are projected to fall from approximately $7.4 billion before the Chapter 11 filing to around $2 billion upon emergence.
“We are pleased to achieve another milestone that reflects the confidence our lenders and noteholders have in our future, with our plan better positioning Spirit to continue delivering value to American consumers,” said Dave Davis, president and chief executive officer of Spirit Airlines.
“While we still have work to do with other important stakeholders, today’s agreements and filings are very material steps forward toward emergence. I also want to thank our Team Members and Guests for their support as we work together to build a stronger Spirit.”
The airline said normal operations continue throughout the restructuring process, with passengers able to book flights and use tickets, credits and loyalty points as usual.
The restructuring comes at a time when airlines globally are grappling with rising fuel costs and operational disruption linked to escalating geopolitical tensions in the Middle East, factors that have added further pressure to already stretched airline balance sheets.