Why Spirit Airlines abruptly shut down

Summary

Episode Summary: Why Spirit Airlines Abruptly Shut Down

Apple News Today – May 4, 2026
Host: Cecilia Ley | Guest: Leslie Josephs (CNBC Airline Reporter)

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Main Theme

This episode dives into the sudden shutdown of Spirit Airlines, a long-struggling US budget carrier. Cecilia Ley guides listeners through the airline's collapse, providing context from airline reporter Leslie Josephs and examining how financial pressures, shifting market dynamics, and external crises converged to bring about Spirit’s demise. The episode also situates this business story within a wider news rundown, but the spotlight is on what happened to Spirit Airlines and the impact on employees and travelers.

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Key Discussion Points & Insights

1. Spirit Airlines’ Reputation and Impact

• Spirit was often “the butt of a joke,” but behind those jokes were dedicated people running and staffing the airline.
  • Notable Quote:
    • “There are real people that run this airline, and there are people that really put their heart and soul into every day.”
      — Leslie Josephs, 00:27

2. Factors Leading to Collapse

• Longstanding Trouble: Spirit had faced years of challenges, including:
  • Increasing operational costs
  • Changing consumer preferences toward more upscale travel
  • Mechanical issues, most notably a major engine defect that grounded aircraft
  • A failed merger with Frontier, followed by a failed acquisition by JetBlue
• Escalating Fuel Prices: The war in Iran caused a surge in jet fuel prices, adding acute financial pressure during Spirit’s bankruptcy proceedings.
  • Notable Quote:
    • “Another major problem it had — it had an engine defect that grounded dozens of its planes. It tried to merge with Frontier... then it made a deal to be acquired by JetBlue and that merger agreement fell... it was really one thing after another that led up to this.”
      — Leslie Josephs, 09:29
    • “Fuel is the airline’s biggest cost generally after labor and Spirit had been saying over the recent weeks that this was one more thing that was challenging its ability to come out of its bankruptcy.”
      — Leslie Josephs, 09:57

3. Failed Bailout and Government Involvement

• Behind the scenes, the Trump administration attempted to orchestrate a $500 million federal bailout, which would have given the government up to a 90% stake. Bondholders opposed the deal, fearing their interests would be overridden.
  • Commerce Secretary Howard Lutnick told Spirit the day before shutdown that the deal couldn’t go through due to lack of agreement with bondholders.
  • Notable Quote:
    • “Bondholders were against it because it would put the government essentially ahead of their interests. … We know that Commerce Secretary Howard Lutnick expressed this to Spirit in the afternoon of Thursday — a full day before… said we’re too far apart on a deal and this isn’t going to happen.”
      — Leslie Josephs, 10:33

4. Abrupt Impact on Passengers and Employees

• Without warning, Spirit ceased operations early Saturday; tens of thousands were stranded or forced to rebook.
• Over 17,000 people directly and indirectly lost jobs.
• Despite jokes about Spirit’s reputation, the end was somber for employees and aviation industry observers.
  • Memorable Scene:
    • “Just listening to a lot of the employees — it was very moving how much camaraderie there was amongst them… Not seeing those planes, those bright canary yellow planes that are fixtures at airports. It’s a very eerie feeling. I went to the Marine air terminal at LaGuardia and it was silent.”
      — Leslie Josephs, 11:11

5. Response from Other Airlines & Passengers

• Airlines including Frontier, JetBlue, and Southwest rapidly introduced discounted fares and added summer routes to accommodate displaced passengers.
• The episode highlights the real-world consequences through the story of Jeremiah Burton, a first-time flyer who had booked a Spirit ticket to visit newborn grandkids.
  • Quick Fact:
    • Jeremiah was due to return May 6th and now faced major travel disruption due to Spirit’s closure.
      — 11:37

6. Spirit in Popular Culture

• Spirit’s reputation as a “punchline” was encapsulated by a late-night joke:
  • “With $500 million, our planes could have two wings again. Amazing.”
    — Jimmy Fallon, 08:57

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Notable Quotes & Moments (by Timestamp)

• “It has kind of been the butt of a joke for a long time, but there are real people that run this airline…” — Leslie Josephs, 00:27
• “Another major problem it had — it had an engine defect that grounded dozens of its planes…” — Leslie Josephs, 09:29
• “Fuel is the airline’s biggest cost generally after labor…” — Leslie Josephs, 09:57
• “Bondholders were against it because it would put the government essentially ahead of their interests…” — Leslie Josephs, 10:33
• “Just listening to a lot of the employees — it was very moving how much camaraderie there was amongst them…” — Leslie Josephs, 11:11
• Humorous moment: “With $500 million, our planes could have two wings again. Amazing.” — Jimmy Fallon, 08:57

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Timestamps for Key Segments

• Spirit’s Downfall and Reputation: 00:27–09:02
• Causes & Failed Bailout: 09:23–10:57
• Human and Industry Impact: 10:57–11:37
• Displaced Passengers & Airline Response: 11:37

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Tone and Language

• The conversation is empathetic and journalistic, balancing professional detachment with moments of emotional resonance for affected workers and travelers.
• Informative but approachable, interspersed with humor (e.g., Jimmy Fallon’s quip), reflecting the airline's mixed standing in the public eye.

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Summary Table: Spirit Airlines Shutdown

| Issue | Consequence | |------------------------|-------------------------------------------| | Engine defect | Aircraft grounded, loss of service | | Merger failures | No relief or industry consolidation | | Jet fuel price spike | Escalating operational costs | | Failed bailout | Abrupt shutdown, massive job loss | | Sudden cessation | Stranded passengers, market disruption |

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In Short:
The episode provides a concise yet comprehensive explanation of why Spirit Airlines shut down, the tangled web of financial and operational woes exacerbated by global events, and the very real fallout faced by employees and passengers. It also acknowledges Spirit's cultural reputation, ending on a note that recognizes the deeper impact beneath the airline’s punchline status.

Transcript

[Cecilia Ley]

Good morning. President Trump says the US Will help guide ships out of the Strait of Hormuz as he considers the latest proposal to end the war in Iran. The Supreme Court's ruling on the Voting Rights act is already reverberating in the South. NPR details the states that are taking action. And CNBC takes us inside the final days of Spirit Airlines.

[Leslie Josephs]

It has kind of been the butt of a joke for a long time, but there are real people that run this airline, and there are people that really put their heart and soul into every day.

[Cecilia Ley]

It's Monday, May 4th. I'm Cecilia Ley, and this is Apple News. Today, As Trump shared the White House's plan to assist stranded ships, he also vowed to respond with force if U.S. efforts in the Strait of Hormuz are disrupted. The announcement came after British authorities said that a cargo ship had come under attack in the area. The Associated Press reports some two dozen attacks on ships have taken place in and around the region since the war began, but this was the first one reported in nearly two weeks. Iran has maintained a blockade on nearly all shipping besides its own for more than two months, and the US Imposed its own blockade last month. Reopening the strait has been a key sticking point in negotiations between the two countries and a source of frustration for the president, who says European allies haven't done enough to help. Over the weekend, that frustration led to a decision that some Republicans criticized.

[Jimmy Fallon]

We're going to cut way down, and we're cutting a lot further than 5,000, thank you very much.

[Cecilia Ley]

Trump said he plans to pull some 5,000 troops out of Germany over the next six to 12 months. The move reflects the president's scaling back of American commitment to European security.

[Noah Robertson]

The Pentagon, when explaining its decision, tried to contextualize this in the much bigger picture of the Trump administration's national defense and national security strategies. Both of those talk about an orientation away from Europe, where the US has long been the security guarantor for the continent and also the largest presence militarily within the NATO alliance.

[Cecilia Ley]

Noah Robertson reports on national security in Congress for the Washington Post. He said that the pivot is also inherently a move towards the Western Hemisphere and the Indo Pacific in an effort to compete militarily with China. But there's also another factor at play here.

[Noah Robertson]

This is in response to a feud that's gone on between German Chancellor Friedrich Merz and Trump. They had been on very good footing up until this point, to an extent, at the cost of Merz's domestic standing, given Trump's unpopularity within Germany. But Recently, Trump has been fuming that NATO allies, including Italy, Spain and the UK and Germany have not been doing enough, in his opinion, to help the US with its war effort in Iran.

[Cecilia Ley]

The Pentagon's announcement was precipitated by recent critical comments from Mers. Exit the Americana.

[Noah Robertson]

Merz was talking to a group of high school students earlier this week within Germany and made comments that were very sharp about how the US was being humiliated within the war and that Iran was slow playing negotiations and was not willing to move forward on actually finding a peace deal amid a ceasefire that's been in effect for the last few weeks.

[Cecilia Ley]

Robertson said that Germany and NATO are trying not to raise more alarm bells and that Europeans are also doing more for their own security. Germany's defense minister said that the move was expected and that about 40,000 US troops remained stationed in Germany. Still, he asserted that troop presence in the country benefits both nations. Part of the concern here is that a withdrawal of this kind could return the US troop presence in the region to levels not seen since Russia invaded Ukraine in 2022. That prompted former President Biden to send troops to Europe to help deter any kind of additional aggression. The announced drawdown also drew a rebuke from some Republicans and a rare joint statement from the GOP leaders of the Senate and House Armed Services Committees.

[Noah Robertson]

They're frustrated that the US is pulling troops from Europe at a time when the war is showing no signs of slowing down and Ukraine still faces daily barrages of Russian missiles and drones on its cities. Russia is doing nothing to slow down its war effort and therefore pulling US Troops away from the continent, in the opinion of the two leaders of the House and Senate Armed Services Committees sends the wrong signal to Russia's leader, Vladimir Putin.

[Cecilia Ley]

Congress has also implemented a requirement for the administration to alert them before lowering European troop presence to a certain level, though it's not clear this would meet that threshold. Germany's top military official, meanwhile, has said it's evident that Europe will need to take on a greater burden within NATO. Last week's Supreme Court decision to strike down a majority black congressional district in Louisiana is already shaking things up across the south, and it's intensifying the nationwide battle over redistricting, a powerful tool for both parties in the fight for control of Congress. Today, a special session is expected to begin in Alabama at the urging of the state's Republican governor, Kay Ivey. At issue is whether legislators will be permitted by the state Supreme Court to change its map prior to the midterms, with the state's primaries set for just two weeks from now. Some Democratic legislators have criticized the last minute move.

[Jimmy Fallon]

I'm sure that he's probably getting pressure from leadership and other members of the national Republican Party because it seems like every Southern state around us is trying to do something to gain power.

[Cecilia Ley]

That was Alabama's Senate Minority Leader Bobby Singleton talking to a local CBS affiliate. Alabama is just one state where Republicans are now arguing that the Supreme Court ruling allows them to try and change their maps. Tennessee will also have a special session to consider breaking up its one Democratic held House seat, and Louisiana has already suspended its upcoming primaries to try and pass a new map. Though that effort is being challenged in court, there are real questions as to how many changes can actually get made before this year's midterms. But in the future, it's possible this ruling could dramatically reshape congressional representation.

[Hansi Lo Wang]

This Supreme Court ruling that weakens the Voting Rights act paves the way for a potential historic drop, the largest ever decline in representation by black members of Congress.

[Cecilia Ley]

Hansi Lo Wang covers voting for NPR.

[Hansi Lo Wang]

We found that there are at least 15 House districts with sizable racial minority populations that are currently represented by black Democrats and are at risk of being eliminated, being drawn out of existence because they were likely protected under the previous interpretation of the Voting Rights Acts by the Supreme Court.

[Cecilia Ley]

The ruling sharply limits how states can consider race when drawing maps, even if they're trying to comply with the Voting Rights act. For decades, Section 2 of the Law had been used to allow the consideration of race conscious data and redistricting to protect the voting power of communities of color. And since the landmark law passed in 1965 during the Civil Rights movement, dozens of districts have been protected by Section 2, according to election law experts. While Section 2 was not eliminated, this ruling has been interpreted as a significant weakening of it, thereby potentially diluting the voting power of minority citizens. As Hoang points out, the number of districts represented by black lawmakers sat at zero or close to zero for 100 years after the Civil War. Since the Voting Rights act came into play, there are now 63 these black

[Hansi Lo Wang]

represented districts are at risk because they are represented by black Democrats. And many redistricting experts are expecting right now, in the middle of this ongoing congressional gerrymandering war between Democrats and Republicans, Republican controlled states are going to try potentially to try to see if they can eliminate these Democratic held districts. And that's why it's at risk right now.

[Cecilia Ley]

According to the Pew Research center, the current Congress that began in 2025 had the highest number of black members in history, though Congress still remains far less racially and ethnically diverse than the US Overall. One former airline executive called it, quote, the airline America loved to hate. And it was the subject of countless jokes.

[Hansi Lo Wang]

According to reports, the Trump administration is close to a $500 million bailout to save Spirit Airlines.

[Cecilia Ley]

Yeah, the CEO of Spirit was like,

[Jimmy Fallon]

with $500 million, our planes could have two wings again. Amazing.

[Cecilia Ley]

That's Tonight show host Jimmy Fallon talking about Spirit Airlines, which seized all operations. Early Saturday morning. The end of the budget airliner with its famous yellow facade and the word Howdy painted on its wingtips came abruptly. Tens of thousands of passengers faced canceled flights or had to rebook tickets mid trip in order to make it home.

[Leslie Josephs]

So Spirit has been in trouble for years.

[Cecilia Ley]

Leslie Josephs is an airline reporter for cnbc.

[Leslie Josephs]

It has faced rising costs. There's been a shift in consumer taste toward more upscale offering. Another major problem it had it had an engine defect that grounded dozens of its planes. It tried to merge with Frontier, that failed. And then it made a deal to be acquired by JetBlue and that merger agreement fell. AP so it was really one thing after another that led up to this.

[Cecilia Ley]

The final financial nail in the coffin was the surge in jet fuel prices from the war in Iran.

[Leslie Josephs]

Fuel is the airline's biggest cost generally. After labor and Spirit had been saying over the recent weeks that this was one more thing that was challenging its ability to come out of its bankruptcy.

[Cecilia Ley]

There were behind the scenes moves involving the Trump administration to keep the airline afloat and to save thousands of jobs. The Wall Street Journal reports that efforts went so far as to find other airlines to the troubled company. Josephs reports that this culminated in an 11th hour bailout proposal which was worth half a billion dollars. The deal would have given the federal government up to a 90% stake in the airline.

[Leslie Josephs]

Bondholders were against it because it would put the government essentially ahead of their interests. There were talks with the bondholders that just fell apart. The two sides couldn't reach a deal. We know that Commerce Secretary Howard Lutnick expressed this to Spirit in the afternoon of Thursday. So this is a full day before Spirit or the news that Spirit was about to shut down and said we're too far apart on a deal and this isn't going to happen.

[Cecilia Ley]

Spirit's closure means more than 17,000 people both directly and indirectly employed by the airline are now out of a job. Joseph says despite all of the wisecracks about Spirit, many of the company's staff continued to work right up to their

[Leslie Josephs]

last day just listening to a lot of the employees. It was very moving how much camaraderie there was amongst them. And even though they're in the industry and that they knew that this was a risk, I think it becoming a reality not seeing those planes, those bright canary yellow planes that are fixtures at airports. It's a very eerie feeling. And I went to the Marine air terminal at LaGuardia and it was silent.

[Cecilia Ley]

Following Spirit's operations ending, multiple US carriers, including Frontier, JetBlue and Southwest, rolled out discounted fares and added new summer routes that could offer relief for passengers whose plans were disrupted. Among them is one man Joseph spoke to Jeremiah Burton. He had booked a flight from Baltimore to New Orleans to meet his daughter's newborn twins. Burton shared that it was his first flight ever and he had chosen Spirit because of its low price. He was supposed to return May 6. And finally, here's a few other stories we're following. Two drug manufacturers asked the Supreme Court on Saturday to step in and preserve access to mifepristone, a commonly used abortion pill, by mail. The emergency request comes after a federal appeals court ruling on Friday said the drug must be picked up in person, temporarily reinstating earlier restrictions. That ruling stems from a lawsuit filed by the state of Louisiana against the fda, which had allowed patients to access the pills through telehealth and mail. Anti abortion activists have targeted mifepristone as medication. Abortion remains one of the few options available in states with strict abortion bans Since Roe v. Wade was overturned in 2022. The pill mailing network has flourished. Abortions in the US have held steady and risen. It's not yet clear how the Supreme Court might rule on the emergency applications. The World Health Organization announced on Sunday that three people have died on a cruise ship in the Atlantic. One of the deaths is a confirmed case of hantavirus, an illness transmitted to humans from rodents. The outbreak occurred on the MV Hondias, which was traveling from Argentina to South Africa. According to the who, there are five additional suspected cases, including one patient currently in intensive care in South Africa. The first person to develop symptoms on the cruise ship was a 70 year old passenger who died on board. The other two deaths include the passenger's 69 year old wife and a 69 year old person from the UK. Humans can catch hantavirus from contact with infected mice or rats or their droppings and can lead to severe respiratory illness. And finally, a highly anticipated sequel kicked off the summer box office season with a bang. Hi, good morning, Miranda.

[Meryl Streep]

Yes, Ashley flag on the play. We don't need you this morning or ever. So pack up your things and HR will be in to see you shortly.

[Cecilia Ley]

Happy?

[Meryl Streep]

You just cost Cornell summa cum laude her job.

[Cecilia Ley]

That's Meryl Streep from the Devil Wears Prada too, which earned $77 million domestically and $233 million worldwide. The film comes two decades after the original and lands at a pivotal time for Hollywood, Variety reports. Disruptions like Covid and writer and actor strikes have slowed movie going in recent years and stagnated box office numbers. But after a strong spring, which featured hits like Project Hail Mary, things are looking better. The first quarter of 2026 is up 23%, and one studio boss says audiences are voting with their wallets. The Hollywood Reporter adds that The Devil Wears Prada 2 is attracting moviegoers across all ages and is a reminder of the buying power of women and teenage girls at the box office. You can find all these stories and more in the Apple News app. And if you're already listening in the news app right now, we've got a narrated article coming up next. The New Yorker explains what really happens when you toss a message in a bottle out to sea, and profiles one of the world's most prolific hunters of these handwritten ocean treasures. If you're listening in the podcast app, follow Apple News Narrated to find that story and I'll be back with the news tomorrow. It.