Spirit is running out of money and time. Trump sounded tepid about a deal to save it

By Chris Isidore, Donald Judd, CNN

(CNN) — President Donald Trump told reporters at the White House Friday that the administration will likely announce its decision on whether to bail out Spirit Airlines “today or tomorrow.”

The long-troubled budget carrier is preparing to stop operations, according to reports on Friday, a move that could leave millions of Spirit passengers trapped across the country and 17,000 employees out of work.

“Well, we’re looking at it — but if we can’t make a good deal, no institution’s been able to do it,” Trump said on Friday. “I’d like to save the jobs, but we’ll have an announcement sometime today. We gave them, we gave them a final proposal.”

Earlier Friday, a Spirit Airlines spokesperson told CNN it had no direct comment on possible shutdown reports.

“Spirit is operating as usual,” said the spokesperson. As of the time of publication, Spirit Airlines appeared to be operating normally.

Soaring jet fuel prices derailed Spirit’s plans to emerge from its second bankruptcy, and negotiations with the federal government on a possible $500 million bailout haven’t yielded a result acceptable to the government and Spirit’s creditors.

Trump’s last week signaled his approval of a deal, and an attorney for Spirit told a bankruptcy court last week the airline was in “very advanced discussions” with the administration. But CNN reported earlier this week that a group of Spirit creditors opposed the terms of the deal that left them with less money after bankruptcy proceedings.

Other airlines have said they will step in and help any stranded Spirit passengers or employees.

But removing Spirit’s flights is likely to raise fares across the entire US airline industry, as flyers compete for fewer available seats.

All air carriers have been struggling with higher jet fuel costs, which have nearly doubled since the start of the war in Iran. Jet fuel is the second greatest cost for airlines behind only labor.

To help compensate, airlines have been raising fares and increasing fees, such as for checked bags. But fierce competition for travelers has kept them from passing along all of the costs to customers. And discount carriers like Spirit have a harder time raising fares due to its dependence on bargain-hunting customers.

Spirit has about 9,000 flights scheduled from May 2 through the end of the month, according to aviation analytics firm Cirium. That works out to an average of 300 flights and 60,000 potential passengers a day affected in just the next month, should the airline shut down.

What happens to passengers?

If Spirit ceases operations, passengers with tickets for upcoming flights should file claims with the issuer of the credit or debit card used to purchase the tickets.

Those who paid cash would have to wait for reimbursement along with the company’s other creditors. Passengers in the middle of a trip would need to find a seat on another airline, which could have much higher costs.

Spirit ranked as the eighth-largest US airline in 2025 by the number of seats offered. The airline is a pioneer in offering ultra-low base fares for domestic flights, charging extra for things like carry-on bags. That model pushed fares lower, and prompted larger airlines to offer cheap “basic economy” tickets.

Fares across the industry have risen this year due to the spike in jet fuel prices. Removing the roughly 2% of domestic flights Spirit is scheduled to fly this summer will push fares up even higher.

Spirit has been unprofitable since travel plunged shortly after the start of the Covid pandemic, filing for bankruptcy twice, most recently in August 2025.

Spirit announced it had reached a deal with its creditors in February to emerge from its latest bankruptcy with less debt and the ability to keep flying. But three days later, the war in Iran started sending jet fuel prices soaring.

Bankruptcies are common in the airline industry, which is a capital-intensive business. Even in the best of times, airlines can run on thin margins. In the last 25 years, eight major US airlines that have filed for bankruptcy.

In many cases, bankrupt airlines are purchased by solvent rivals, which has led to widespread consolidation. Four major carriers — United, American, Delta and Southwest — now control about 80% of flights available to passengers.

But Spirit’s closure would be the first shutdown of a significant US airline since Midway Airlines went out of business immediately following the September 11 attack.

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This story has been updated with additional details.