Major airline shuts down and cancels all flights after rescue talks collapse

The ultra-low-cost airline employed around 17,000 people

Spirit Airlines announced it was ceasing operations after 34 years, with the Florida-based carrier employing approximately 17,000 people.

The ultra-low cost airline, which employed about 17,000 people, said it had “started an orderly wind-down of our operations, effective immediately.”

The carrier traces its origins to a trucking company established in the 1960s. It began air operations after being founded as an airline in 1983 and relocated its base to Florida in 1999.

At its peak in the mid-2010s, Spirit launched up to 29 new routes and was once valued at $6 billion, but it has faced financial difficulties in recent years.

The airline said on its website that all flights have been cancelled and customer service is no longer available.

“We are proud of the impact of our ultra-low-cost model on the industry over the last 34 years and had hoped to serve our guests for many years to come,” the announcement said.

The company went on to advise customers that they could expect refunds; however, no assistance would be provided in booking travel on other airlines.

The shutdown was anticipated after Friday passed without a required government bailout for the cash-strapped business.

US President Donald Trump said yesterday that his administration has given the budget carrier a “final proposal” for a taxpayer-funded takeover in the hope of keeping it from going under, however a deal was not reached.

Trump raised the prospect of a bailout last week after the airline entered bankruptcy proceedings for the second time in less than two years, as jet fuel prices surged amid the Iran war. Spirit lawyer Marshall Huebner said about 17,000 jobs could be affected by a shutdown.

The airline has struggled financially ever since the COVID-19 pandemic, weighed down even more by rising operating costs and growing debt. By the time it filed for Chapter 11 protection to restructure its debt under court supervision in November 2024, Spirit had lost more than $2.5 billion since the start of 2020.

Spirit then sought bankruptcy protection again in August 2025, when it reported having $8.1 billion in debts and $8.6 billion in assets, according to court filings.

Supporters of a rescue, including labour unions representing Spirit’s pilots, flight attendants and ramp workers, say a collapse would leave thousands of people out of work and harm consumers by reducing airline competition and driving up airfares.