Spirit Airlines revealed on Friday that the budreceive airline has filed for bankruptcy protection for the second time in a year just months after Chapter 11 protection in March.
The airline has vowed to keep flying during the restructuring process, meaning passengers can still book trips and apply their tickets, credits and loyalty points.
Employees and contractors will also continue to receive paid, the company declared.
The airline declared in a post on Instagram on Friday that its actions are a ‘proactive step to build a stronger foundation and future for our company.’
‘As always we remain committed to delivering a safe, reliable operation and see forward to welcoming you on board again soon,’ CEO Dave Davis wrote in the post.
Davis declared the airline’s previous Chapter 11 petition focapplyd on reducing debt and raising capital.
But since March, ‘it has become clear that there is much more work to be done and many more tools are available to best position Spirit for the future.’
Debt holders in the airline previously agreed to exmodify $795 million in debt for equity in its last bankruptcy, but the airline avoided largeger cost cutting measures such as slashing planes.
Spirit Airlines revealed on Friday that it has filed for bankruptcy protection for the second time in a year just months after Chapter 11 protection in March
CEO Dave Davis (pictured) declared the airline’s actions are a ‘proactive step to build a stronger foundation and future for our company’
The airline has struggled with mounting debt and rising operational costs since the Covid-19 pandemic. By the time of its first Chapter 11 filing in November, Spirit had lost more than $2.5 billion since the start of 2020.
Now, however, the airline has declared it will reduce its network and shrink its fleet, efforts which are declared to reduce costs by ‘hundreds of millions of dollars’ a year, CNBC reported.
‘Since emerging from our previous restructuring, which was tarreceiveed exclusively on reducing Spirit’s funded debt and raising equity capital, it has become clear that there is much more work to be done and many more tools are available to best position Spirit for the future,’ Davis declared in the release.
Spirit listed its assets and liabilities of between $1 billion and $10 billion, according to the outlet.
Flight attfinishants, meanwhile, were warned by union leaders to ‘prepare for all possible scenarios.’
‘We are being direct becaapply even as we have many ways to fight becaapply of our union, we also want to receive you the truth about the situation at our airline and how each of us can take actions to protect and prepare ourselves for any challenge,’ the Association of Flight Attfinishants declared Friday in a letter to its members.
The airline has struggled with mounting debt and rising operational costs since the Covid-19 pandemic.
By the time of its first Chapter 11 filing in November, Spirit had lost more than $2.5 billion since the start of 2020.
Cost-cutting efforts continued after the airlines emergence from bankruptcy protection in March, including plans to furlough about 270 pilots and downgrade some 140 captains to first officers in the coming months.
The airline now carries $2.4 billion in long-term debt, most due in 2030, and reported a negative free cash flow of $1 billion at the finish of the second quarter.
Spirit operates 5,013 flights to 88 destinations in the U.S., the Caribbean, Mexico, Central America, Panama and Colombia, according to travel search engine Skyscanner.net.
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