(CNN) — Chris Dell had already paid to go on a cruise next month with her two daughters when she woke up shocked Saturday to learn Spirit Airlines, which they were set to fly with for the trip, had shut down without prior notice.
She rushed to the nearest airport, Hartsfield-Jackson Atlanta International, to find alternative flights, but without a refund for her Spirit tickets so far, she’d have to pay more money out of pocket, she said.
When Dell called Spirit’s customer service, the line “hangs straight up … you can’t get anybody,” she said.
“I’m upset,” Dell said. “And then it makes me nervous because I have already paid money to go on a cruise … I can’t let that go to waste. And then I don’t want to drive all the way to Miami. That’s like ten hours. It’s only me and my two kids. This is why we’re flying.”
Dell is one of thousands of frustrated Spirit customers who have been forced to change travel plans — or were left stranded — as the airline ceased operations globally, marking the first time in 25 years a major US airline has gone out of business due to financial trouble. The collapse comes as the company had plunged into its second bankruptcy after struggling for years and failed to secure a last-minute rescue deal with the Trump administration.
The ripple effects of the pioneering budget airline that reshaped low-cost travel coming to an end after 34 years in operation have been swift: All of its bright-yellow flights were canceled, customer service was halted and travelers who were set to fly were told not to come to the airport.
Here’s everything you need to know about Spirit’s shutdown:
Why did Spirit Airlines shut down?
The budget carrier filed for Chapter 11 bankruptcy twice in the last two years, most recently in August.
But the airline’s financial troubles stem back to the Covid-19 pandemic. It hasn’t been profitable since then and said repeatedly in recent years there was “substantial doubt” over its ability to continue flying.
While the company said in February it had reached a deal with creditors to emerge from its latest bankruptcy and stay in operation, the war in Iran started just three days later, causing the cost of jet fuel to soar and as well as airfares.
After labor, jet fuel is the second-biggest cost for airlines. Larger airlines have been able to mitigate the impact by increasing some fees and fares and cutting flights, but business for smaller airlines like Spirit suffers when they increase their ultra-low fares intended to attract customers.
While a glimmer of hope for Spirit’s future came from an airline attorney who told a bankruptcy court last week it was in “very advanced discussions” with the Trump administration on a rescue package, a key group of creditors rejected that plan, according to a source familiar with negotiations. It would have given the government control of the overwhelming majority of Spirit’s shares, a prospect that sparked backlash from the airline industry and Republicans in Congress.
President Donald Trump signaled his approval last week but acknowledged Friday a deal may not be possible.
What should you do if you booked a Spirit flight?
An average of 300 flights and 60,000 potential passengers a day just in the next month will be impacted by Spirit’s collapse.
Passengers in the middle of a trip must now rebook on another airline, likely facing hiked-up fares as they scramble to find new tickets last minute. Spirit said it’s not able to help rebook flights to other airlines.
But some airlines are jumping in to help with the disruption. United Airlines, Delta Air Lines, JetBlue Airways and Southwest Airlines are capping fares for Spirit passengers, with prices expected “to be about $200 for a one-way ticket,” US Transportation Secretary Sean Duffy said.
Travelers must provide a Spirit confirmation number and proof of payment to access the fares, he said, and the “offers are not going to be open forever.”
Additionally, American Airlines and Delta are offering reduced fares on high-volume Spirit routes, while Allegiant Air has frozen prices on overlapping routes, Duffy said. Frontier Airlines is offering 50% off base fares across its network until May 10.
The US Department of Transportation encourages travelers to check with other airlines “to see if they will accept your ticket, on a confirmed or standby basis, or will offer you a discount on a new ticket by waiving advance purchase requirements or other restrictions.”
Katy Nastro, a travel expert with Going.com, referred to those accommodations as “rescue fares” and said they may be limited. “Rebook with those carriers ASAP.”
How do you get a refund?
Spirit has said in a note to its customers it’s not able to help rebook flights to another airline, but it will automatically issue refunds to passengers who bought tickets through Spirit with a credit or debit card.
Passengers who booked flights via a travel agent “should contact the travel agent directly to request a refund,” Spirit said.
As part of the federal government’s efforts in coordination with airlines to bring relief to travelers and the Spirit workforce, Duffy outlined a mix of capped fares, discounted rebooking options and employee support measures.
Duffy also reminded customers Spirit will issue automatic refunds and advised passengers to consider credit card chargebacks, travel insurance claims or bankruptcy filings for additional recovery options.
But customers who booked flights using any other method, including a voucher, credit or Free Spirit points, may not get their money back. Companies that go out of business typically stop honoring rewards, coupons and vouchers after they cease operations. Spirit said potential refunds of those payment methods will be determined in the company’s bankruptcy court process.
What happens to their employees?
The decision has put 17,000 workers out of a job, including 14,000 Spirit employees and thousands of contractors and other people whose jobs depend on Spirit.
And the workforce only got word of the loss of their jobs an hour before the official announcement.
“We are delivering the hardest news of our lives that Spirit will permanently cease operations at 3:00 AM Eastern Time on May 2,” read the message from the leadership of the Association of Flight Attendants at Spirit to the union’s 5,000 members at the airline about 1 a.m. ET.
Flight attendants are now being sent home or back to their bases, with flights and hotels covered, according to the union.
Duffy said major carriers are extending travel privileges for Spirit employees and creating hiring pipelines, including dedicated job portals at American and United.
“Most major U.S. carriers are extending travel pass benefits and spare jump seats to Spirit pilots, flight attendants, and other employees who need to return home,” a news release from the Department of Transportation said. “They have also offered Spirit team members preferential employment interviews to ensure they jump the queue.”
American and United also included links to job portals for suddenly unemployed Spirit workers.
Will this cause an increase in other airline prices going forward?
Just this summer, Spirit represented 2% of domestic US flights scheduled to fly, and the fallout will likely push fares higher across the entire industry.
Spirit’s low-cost model forced other major airlines to also offer competing fares to attract business, but now that it’s gone, “the same amount of necessity to offer a low fare is not there,” said Richard Quest, CNN Business’ editor-at-large. “They were a drain on the industry, making it unprofitable for some other airlines such as JetBlue — who now, because Spirit has gone, arguably can put themselves in a marginally better position.”
Now, other discount airlines are potentially in jeopardy as their vulnerabilities are more exposed due to fuel prices surging since the onset of the Iran war, Quest said.
There will undoubtedly be consolidation, as the fuel price crisis forces airlines to “readdress their cost basis,” Quest added.
Zach Griff, author of the airline newsletter From the Tray Table, also warned that Spirit shutting down could cause an uptick in prices.
“If you remove low-cost competition from the equation, then, yes I think that United and those airlines could really get away with these higher fares sticking around for a long time,” Griff said.
CNN’s Chris Isidore, Marnie Hunter, Rafael Romo, Gloria Pazmino and Maria Sole Campinoti contributed to this story.
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