Spirit Airlines may be days away from collapsing

Added: 2026-05-07

[00:00:00]So, time is running out to reach a deal to save Spirit Airlines from collapse.

[00:00:05]We're hearing talks for a government-backed bailout plan have apparently stalled, and that's according to multiple sources. We're joined now by CBS News senior transportation correspondent Chris Van Cleave, who's been investigating all of this. Chris, why might time be running out on this surprise deal that the White House offered?

[00:00:25]Well, good morning, Errol. Sources tell us that Spirit's available cash on hand and the money they use to operate is now measured in days, not weeks. And if that money were to run out, the airline likely would have to cease operations.

[00:00:39]Now, that's playing out as these negotiations around a proposed government aid package of around $500 million have stalled, we understand. Two of Spirit's three main groups of creditors are on board. The bondholders have not signed on. In fact, one of them floated a counteroffer that was rejected. And hanging in the balance now are about 7,500 Spirit employees and another 10,000 or so who are indirectly employed by the airline. So, you know, we are coming down to really potentially the final hours here for someone to make a move to either intervene and prop up Spirit or they may be uh close to having to park their planes. And what happens, Chris, if that is the case? I mean, you've got a lot of Spirit customers who currently have tickets. We're heading into the month of May, or they may be about to purchase a ticket for summer travel. What should those customers and potential customers do?

[00:01:40]Well, have a backup plan to to start. As we as we speak today, Spirit is running normally. Their flights are taking off as scheduled this morning. The question is how long does that continue? If you have a reservation on Spirit and the airline ceases to operate, you'll get that money back cuz you bought it with your credit card. Your credit card will refund you. If you're in the middle of a trip and the airline stops operating, well, you're going to be stuck. Other airlines have plans to offer rescue fares, but you'll essentially have to buy a new ticket to get home, and that may cost more than what's left on that ticket you had with Spirit. And the other group of people, of course, if you have Spirit frequent flyer points, I would encourage you to use those now because if the airline were to shut down, those will likely become worthless. And then sort of bigger picture, likely airfares go up in general in markets where Spirit was strong. Uh Spirit points to its own internal numbers that show fares go up by about 23% when Spirit exits a route. That, according to Spirit, is about $60 a round trip. So, there will be ramifications if Spirit has to stop operating. Um for flyers with upcoming reservations, though, your credit card company will refund you. Yeah, a real issue that could impact all flights, not just uh customers of Spirit. Chris Van Cleave, up early in Phoenix for us.

[00:03:00]Chris, thank you so much.