US carrier Spirit Airlines has filed for a "pre-arranged" Chapter 11 bankruptcy with the US Securities and Exchange Commission and flights will continue to operate “as normal”.
The Florida-based airline said the move was part of a "proactive step" that also includes a restructuring agreement, which is "supported by a supermajority" of its bondholders.
In a letter to customers, Spirit said they could continue to use all tickets, credits and loyalty points "as normal", as well as benefiting from the Free Spirit loyalty programme, Saver$ Club perks and credit card terms.
“The most important thing to know is that you can continue to book and fly now, and in the future,” added the carrier in the letter.
Spirit said the financial restructuring process was "expected to reduce our total debt, provide increased financial flexibility, position Spirit for long-term success and accelerate investments providing guests with enhanced travel experiences and greater value".
Earlier this month, Spirit delayed its quarter earnings report, citing its attempts with debt holders to restructure its obligations and explore "strategic alternatives and other ways to improve liquidity for the company".
It also noted that third quarter operating revenues were down by around $61 million year-on-year due to lower average yield, the negative impact of no longer charging change and cancellations fees, along with higher operating expenses.
As part of the Chapter 11 filing, Spirit expects to be delisted from the New York Stock Exchange in the near future.
Rumours have swirled for months that Spirit would need to file for bankruptcy amid quarterly losses and following its failed $3.8 billion merger attempt with JetBlue, which the US Department of Justice ruled against in January 2024. The carriers initially appealed the decision, but then called off their merger in March.
Spirit hopes it will be able to complete the Chapter 11 process in the first quarter of 2025 "and emerge even better positioned to deliver the best value in the sky."