Spirit Airlines Halts Growth Plans and Things Could Get Uglier

Airbus, Spirit

If you happen to be around the Fort Lauderdale airport and hear a grinding sound, don’t worry. It’s not an airplane’s mechanical problem. It’s just Spirit Airlines deciding to effectively grind its growth plans to a halt next year. This is understandable but concerning news for the airline.

Spirit announced yesterday that it would defer all new airplanes scheduled to be delivered from second quarter 2025 all the way through the end of 2026 (except for two “direct lease” airplanes which will still come in) until the 2030-2031 timeframe. You can just assume this counts as “some random time in the future that we’ll agree on down the line if we’re both in business.” The airplanes set to be delivered in 2027-2029 will come as planned for now. Spirit is not extending leases on other aircraft — at least not according to its fleet plan — so it can try to keep capacity growth up even without new airplanes. This really is slowing to zero.

Data via Spirit Airlines and estimates

This chart above is based on the numbers Spirit gave through 2025 in its public fleet guidance. The deferrals in 2025 are based on the change from the fleet plan the airline published just two months ago on February 8.

The 2026 numbers are my best guess based on the information I was able to cobble together. We do know that Spirit won’t take any deliveries that year, but what we don’t know is exactly how many airplanes the airline previously expected to have delivered that year. So take those estimates for what they’re worth.

The more interesting chart is probably this one which shows Spirit’s fleet growth by year going back to 2011 and running until 2026.

Spirit Fleet Size at Year-End by Fleet Type

Data via Spirit Airlines SEC Filings

Spirit, like most ultra low cost carriers, is built for growth. It takes on a lot of new, expensive airplanes and flies them as hard as it reliably can. You can see a steady growth pattern dating all the way back to 2011 with only a minor slowdown at the start of the pandemic.

This growth brings in a lot of new employees who get paid less than more senior employees, so the airline can keep costs down overall. This isn’t any new kind of strategy. Southwest used this for decades when it was in hyper-growth mode, but that phase always come to an end at some point.

The problem now is that even if growth doesn’t slow down, there are already cost headwinds that didn’t exist in the old days. First, there’s the high price of fuel which is no cheaper for low-cost carriers. Then there’s the price of employees which has skyrocketed, especially for pilots as the shortage pushed wages up. There has been a lot of downward pressure on fares as well. With all this, United CEO Scott Kirby has pushed to change the ULCC moniker to LMA… low-margin airlines. (Nice try.)

Now with Spirit deferring all these airplanes, its problems become worse. It needs fewer new, cheaper employees. In fact, it said it was actually going to have to furlough 260 pilots after the peak summer season. I didn’t think we’d be hearing the “f” word so soon, but here we are.

You might be wondering… why is Spirit doing this if it’s going to make things worse? Well, it’s all about the only thing that matters in this industry: cash.

Spirit continues to lose money, and while it has some cash, it has a whole lot of debt maturing soon, so it needs to get its house in order fast. It is making progress. First, the airline settled with Pratt & Whitney for all the engine issues. That will put another $150 to $200 million in the tank this year and take some pressure off.

Now, this agreement with Airbus will save the airline from having to fork over $340 million to take delivery of those airplanes. You know Airbus isn’t sad. It hasn’t had delivery slots available for awhile, so it can now make some other airlines very happy.

Meanwhile, Spirit continues to flail in its bid to keep its head above water. With the growth engine turned off, it needs to focus on getting those revenues up to cover those costs… which will continue to be under pressure. It’s not an enviable place to be when you’ve historically make your money by offering low fares.

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24 comments on “Spirit Airlines Halts Growth Plans and Things Could Get Uglier

  1. A few questions questions –

    1) with the engine issues, this means Spirits “flat” fleet will actually be drawn down, right? How many planes on average – how many flights will come down as a result?

    2)While Spirit gets short term cash from IAE, without new planes, they also can’t execute sale-leaseback transactions which generate big cash infusions

    3) I’m still struggling to see a strategy from both Spirit and Jetblue. At a time when travel is still booming and prices are high, South Florida is growing, you would think both carriers would have found some success right now. Have the big carriers just gotten so good that they LCCs are unattractive to customers (reliability, pricing pressure, etc.?) – why can’t they seem to figure out how to make short term money, let alone have a long term strategy?

    1. Noah – 1) Yes, they’ve said it could be up to 40 airplanes by the end of the year.
      2) True, but they have to be focused primarily on fixing the balance sheet so they can refinance the debt that’s coming due first and foremost 3) I think that it’s still early days. A lot is moving at JetBlue, but Spirit seems to be treading water. Too early to tell how either will come out.

  2. Hate to be right on this, but my prediction for 2024 was that we’d see furloughs. Pilot shortage hype has always been short lived, and with legacies/WN slowing hiring, it’ll go down the line. Unfortunate thing is that you have flight schools packed to the brim with kids who paid $100K+ for zero to hero programs who will hit their 1,500 hours about the time hiring slows to a crawl, while the 26 year olds hired by mainlines squat on this positions for nearly four decades.

    1. Was it Jamie who coined it? I know he’s been using it, but I thought Scott coined it. Either way, yes, they’re both actively using it.

    1. And plenty of non-U.S. carriers too. Now instead of those planes going to JetBlue and staying in the U.S. system, we will see a net negative to U.S. capacity. The merger should’ve been approved

  3. All airlines need to grow in order to keep costs down. The covid era resulted in a hard reset for the entire industry and interrupted demand for ultra low fares which legacy carriers were even more capable of providing. The ULCC model is in danger in the US because ULCCs are incapable of generating enough new customers.
    While there are some variations in compensation, skilled labor costs have to be in the same range so airlines have much less ability to offer very low fares. The legacies can tap into high longhaul international fares which have been the largest factor for why legacies have financially outperformed even domestic LCCs such as WN.
    As for low margin airlines, DL is one of the only US carrier that is expected to be profitable for the 1st quarter. Given that DL matched UA’s industry leading growth in 2023 but has already guided to lower capacity growth for 2024, the real question is whether it will pull back growth even further given that other carriers will be less capable of growing.
    While some would love to think that Airbus and Boeing are going to immediately place deferred orders with other airlines, both are paying customer compensation for delays – Boeing directly for its own production problems and Airbus heavily due to P&W GTF issues. NK’s deferrals are quite small in the scope of Airbus’ promised deliveries of the A320NEO family and, even combined with other airline voluntary deferrals, might not be enough to get Airbus deliveries back on track. Based on statements from Pratt and Whitney, they are likely to build the parts necessary to correct currently known issues with the GTF in the next 18 months to 2 years which will result in a fairly significant number of aircraft returning to service including for Spirit. Pratt is likely to get GTF groundings resolved before Boeing gets production of the MAX up to pre-Alaska accident plans. Airbus’ willingness to defer parts of NK’s order and P&W’s willingness to provide compensation to NK is not just to keep a customer from folding – never looks good when that happens – but also to remove orders that neither can deliver.
    Let’s also not forget that Allegiant is a customer for the MAX 7 and will get those aircraft after WN and the MAX 10 will then get certified to UA, DL and AA’s benefit, with the latter two having more Airbus than Boeing narrowbodies on order.
    Crude oil prices are heading back up earlier than they did last year which is not great for airlines that do not have fuel cost containment strategies. Spirit and United paid the highest fuel prices for their particular segments in 2023 with Delta’s refinery strategy delivering lower cost/gallon than Southwest’s hedging strategy for the first time. Tight capacity will allow higher fares which are needed to cover high fuel prices.
    We can just hope that macroeconomic conditions will be favorable for growth by late 2026 and into 2027 when a bunch of capacity will come online.

    1. “As for low margin airlines, DL is one of the only US carrier that is expected to be profitable for the 1st quarter. Given that DL matched UA’s industry leading growth in 2023 but has already guided to lower capacity growth for 2024, the real question is whether it will pull back growth even further given that other carriers will be less capable of growing.”

      Tim, this article was completely about Spirit’s fleet plans and the effect it will have on their growth. Why did you feel the need to insert this completely unrelated blurb about Delta’s profitability into your comment? You seem to be obsessed with them for some reason.

      1. You must be new here lol. That type of response from him as predictable as death and taxes!

        1. Tim strikes me as the type of person who always assumes that he’s the smartest person in the room. Good grief Tim, get over yourself. :)

      2. Remember for some people aka “Tim”, Delta is the greatest. At every carrier where I worked, we called them “Deltoids”. The most common comment, especially at meetings, was “That’s not the way we did it at Delta”

      1. Maybe. But I think one large, national ULCC or LMA or whatever we want to call them would have a much greater impact on competition and pricing than two smaller niche carriers, each struggling for survival.

  4. Spirit is already doing something to its schedule.. no longer some of the connections in FLL that have been there for the longest time… probably domestic traveling more profitable than international.. any number you can run on this Cranky

    1. Juan – If that’s the case, it’s probably just temporary. I do think they want connections into Latin/Caribbean if it makes sense.

  5. LMA… low-margin airlines are better than NMA… no margin or negative margin airlines.

    Captain Obvious

  6. Can’t help but wonder if Spirit will hike its already exorbitant baggage fees and maybe even reduce the cutoff for what is considered an “overweight” bag from an already low 40 pounds to 35 or even 30 pounds?

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