Who Will Buy Spirit Airlines’ Aircraft If It Goes Under?

Spirit Airlines has emerged from bankruptcy only to again warn it may not survive a year, which carriers will buy Spirit Airlines fleet if it goes under? 

Bankruptcy Warning

This week, Spirit Airlines management issued a concern to the market and shareholders that it could have trouble surviving to the end of 2026. CEO, Dave Davis indicated that he was legally required to share his concern in the manner in which he did, though he expressed confidence in his plan and approach to the turn around.

“Because of the uncertainty of successfully completing the initiatives to comply with the minimum liquidity covenants and of the outcome of discussions with our stakeholders, management has concluded there is substantial doubt as to our ability to continue as a going concern within 12 months from the date these financial statements are issued.” – Spirit Airlines 10-Q

Matthew wrote this week that while Davis downplayed his statements, that flight attendants should remain prepared for the carrier to fail in its rebuild mission.  While I am personally rooting for Spirit given a number of unique benefits I believe the airline provides for aspects of the market, the rest of this post will assume the carrier doesn’t make it.

Carriers Who Might Purchase Assets, Take Over Routes

JetBlue and Frontier seem like the obvious choices to grab Spirit Airlines equipment and perhaps take over routes the carrier operated. If that’s the case, JetBlue would likely focus on Fort Lauderdale where it already has a considerable presence, while Frontier or even Allegiant would pick up Las Vegas and Orlando with the new aircraft.

However, JetBlue doesn’t appear to have the same appetite it once had and there’s no telling if finance will be as ambitious as it was for an outright merger. Frontier has also struggled in quarterly results and may not be able to pull off the asset purchases without the combination.

Alaska and Southwest have both indicated they could be open to new aircraft types, and while Alaska has been firmly Boeing (outside of some Embraer purchases and its acquisition of Virgin America and Hawaiian) this could be an opportunity to further expand its footprint in a meaningful way. Southwest is going through its own renaissance at the moment and it seems an unnecessary complication unless the aircraft were offered at such a deep discount management couldn’t say “no.”

American and United both fly A320s and could be in the market. American would likely replace older equipment ahead of schedule but it wouldn’t keep any of the routes from Fort Lauderdale, instead moving them to Miami and throughout the system.

United is the most interesting of them all. The airline seems to be on firm financial ground, is looking to shake things up (with its partnership with JetBlue), and has been rumored to be interested in some Florida presence as a focus or hub city. It’s recent tie-up with JetBlue and the airline’s history with its failed Spirit merger could ruffle feathers, however.

Delta is always looking for a good deal and has two unique characteristics the others don’t: it has the cash to buy the airline outright (if it was approved by legislators) and it has some aging, less capable, less fuel-efficient aircraft it needs to replace. It has a history of buying cheaper, older aircraft at great prices to fuel growth. This would be very much in-line with its model. It also has the ability to take over the new orders Spirit has committed to purchase from Airbus.

Conclusion

If we presume that Spirit cannot make it through 2026 and is sold for parts, a single carrier like Delta, could come in and buy the majority at a significant discount and expand its market position even beyond its current level. It’s also a possibility that a consortium of carriers will buy equipment, routes, or stations that make sense for their strategy – if the government allows a Pan Am-style dissolution. And while I would personally prefer Spirit to remain as it is and the market to respond positively to its product (the only option in the US for European-style business class with an open middle seat), it may not happen.

What do you think?