Spirit Airlines is struggling financially, citing “substantial doubt” about its ability to stay in business for more than a year due to continued losses and dwindling revenue. The airline, which emerged from bankruptcy earlier this year, has made changes to avoid being forced to shut down.
If Spirit ceases operations or is acquired by another carrier, airfares across the board could increase, affecting not only its customers but also passengers of other airlines. Spirit’s low-cost model has driven prices down for domestic flights, prompting major airlines to offer their own cheap seats.
The airline’s absence would leave a significant “Spirit Effect,” with legacy airlines and low-cost carriers reducing fares by an average of 7-11% when Spirit enters the market. However, Spirit itself has been incurring losses since 2020, with revenue this year down 20% compared to the previous year.
Even if a merger is ruled out, reduced competition could lead to higher fares, as airlines might cut seat capacity in basic economy classes. Spirit’s CEO Dave Davis has argued that his airline has saved consumers millions of dollars and remains committed to protecting its franchise.
A potential buyer for Spirit Airlines includes major carriers like United, Delta, or American Airlines, which would face antitrust scrutiny similar to the 2022 JetBlue proposal. However, opponents of airline mergers argue that consolidation leads to higher fares, citing the negative impact on competition and passenger welfare.
Source: https://edition.cnn.com/2025/08/17/business/spirit-airlines-air-fare-impact