Spirit Airlines announced that it will sell multiple aircraft and lay off workers as the beleaguered carrier tries to raise cash.
In a filing on Thursday with the Securities and Exchange Commission (SEC), the ultra-low-cost carrier, whose plan to merge with JetBlue was blocked by regulators this year, said it identified approximately $80 million in annualized cost reductions that it plans to implement next year.
These cost reductions will primarily result from "a reduction in workforce commensurate with the company’s expected flight volume," Spirit said in the filing. The company didn't disclose how many cuts would be involved.
The airline also said in the filing that it has agreed to sell 23 of its A320ceo/A321ceo aircraft to GA Telesis for about $519 million.
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The company estimated that the net proceeds of the sale in combination with discharging the Aircraft-related debt from its balance sheet, will boost liquidity by approximately $225 million through year-end 2025.
Spirit said its third-quarter 2024 capacity was down 1.2% year over year, and the company estimates its fourth-quarter 2024 capacity will be down roughly 20% year over year.
Even though merger plans with JetBlue fell through, Spirit is still trying to revive itself. The company re-ignited potential merger talks with Frontier Airlines as it continues discussions of a potential bankruptcy filing, according to The Wall Street Journal.
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People familiar with the matter told the Journal that talks between Spirit and Frontier are at an early stage and a deal might not happen.
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In January, a federal judge blocked JetBlue's acquisition of Spirit after agreeing with the Justice Department that the deal would hurt the availability of low-cost air travel tickets.
The carriers argued that it would help save consumers hundreds and create a low-fare, high-value competitor to the "Big Four" U.S. airlines.
