Spirit Airlines has announced that it will defer deliveries of new Airbus planes in an effort to boost liquidity. The decision to defer all Airbus planes scheduled for delivery from the second quarter of 2025 through the end of 2026 will provide the airline with an additional $340 million in liquidity over the next two years. While these steps are not ideal, Spirit CEO Ted Christie believes they are necessary to ensure a strong and profitable future for the airline. This move will allow Spirit to reset its business and focus on its core operations amidst changes in the competitive environment.
As part of its plan to boost liquidity, Spirit Airlines also announced that it will furlough approximately 260 pilots starting in September. The airline has already implemented leaves of absence for flight attendants, but there are currently no plans for furloughs among cabin crew members. The Air Line Pilots Association, the union representing Spirit’s pilots, is exploring voluntary measures to limit the number of pilot furloughs. The decision to furlough pilots, coupled with the retirement of the A319 fleet and ongoing Pratt & Whitney engine issues, has raised concerns among the pilot group.
Spirit’s decision to defer Airbus deliveries comes at a time when airlines are facing challenges in aircraft availability. Airlines like United have been offering unpaid time off for pilots due to delayed plane deliveries from Boeing. The shortage of aircraft is a stark contrast to the pilot shortage experienced during the peak of the pandemic. With Spirit’s Airbus delivery slots likely to be in high demand, the industry will be closely watching how other airlines respond. While United Airlines declined to comment on whether it will take over Spirit’s Airbus delivery slots, Airbus has hinted at remarketing the slots to other customers.
Spirit Airlines plans to publish its next financial outlook for the quarter and full year within the next week. The airline has been working to convince investors that it is on track to boost liquidity and ensure a profitable future. Despite the challenges posed by the grounding of many Airbus planes and the failed acquisition by JetBlue Airways earlier this year, Spirit remains focused on strengthening its position in the industry. The airline’s ability to navigate these challenges will be critical in shaping its future financial performance.
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