Spirit Airlines collapse could hit flyers, raise costs for other flights

The collapse of Spirit Airlines is set to reverberate across the airline industry, after failed bailout talks with the Trump administration led the prominent budget carrier to abruptly shut down over the weekend.

The administration had floated a last-ditch bailout that would have given the federal government a controlling stake in the airline, but the proposal stalled amid resistance from key creditors, whose approval would have been required for the deal to go through.

Now, as the airline closes up shop, some analysts warn even non-Spirit flyers could feel the impact, as reduced market competition is likely to put upward pressure on ticket prices, which have already been rising as major airlines contend with higher jet fuel costs amid the Iran war. 

Others predict the fallout will be more contained, since the airline accounted for just 3.4 percent of the market and had already been shrinking.

“The bad news for consumers is it takes another low-cost carrier, potentially, out of certain markets. That’s always bad news because even if you were never to fly Spirit, you benefited if they were flying to your market,” Clint Henderson, travel expert at The Points Guy, said in an interview with The Hill. 

Henderson noted when Spirit Airlines stopped flying to Minneapolis in December, Delta Air Lines increased prices “almost immediately,” in some cases by as much as 50 percent.

“In the markets where Spirit is operating, it could have a pretty big impact on pricing, so consumers will pay more,” Henderson said.

“I will say, Spirit has shrunk so much that it’s not a huge player anymore in the American airline industry,” he added. “So the impact will be somewhat muted by that because they’ve cut so many flights already. But any time we lose a low-cost carrier is bad news for consumers.”

Spirit Airlines officially shut down Saturday, canceling all remaining flights and telling ticketed passengers not to show up at the airport because their flights would not take off.

The airline........

© The Hill