As we all know, Spirit Airlines has been having a rough go. Their financial performances has not been good for the past several years, and JetBlue’s bid to acquire them went down in flames. To help lessen the bleeding, Spirit Airlines defers deliveries of new aircraft and will be furloughing hundreds of pilots later this summer.
There’s no doubt that Spirit is struggling to survive. However, unlike its former suitor, they haven’t been sitting around waiting for a merger to happen, which is good, as the merger was blocked and canceled, anyway. However, the moves they been making haven’t been enough to bring the airline back to profitability. As such, additional actions are necessary.
Spirit Airlines Defers Deliveries
With the airline scaling back its expansion plans, they no longer need as many aircraft as they once thought they did – at least for now. As such, to save money Spirit Airlines defers deliveries of new jets from Airbus. Specifically, it has reached an agreement with Airbus to stop delivers of A320neo and A321neo jets due to be delivered from Q2 2025 to late 2026 to sometime between 2030 and 2031. That’s a delay of five years. In 2025 alone, that means Spirit won’t take delivery of six A320neos and 15 A321neos, though it’ll still accept four of the larger jets, plus an additional two leased A321neos.
Further, Spirit plans to divest the rest of its A319 fleet by mid-2025, taking 13 of these smaller birds out of service through the end of this year, and the final two in the first half of 2025. Still, the Airline expects to receive 24 new aircraft throughout the rest of this year, which will more than offset their lost capacity. Or will it?
By mid-2025, Spirits fleet will consist of 121 neo jets, and 94 ceo birds. Why is that notable? Well, because all of Spirit’s neos are powered by Pratt & Whitney geared turbofans. Yeah. As such, a significant number of them will be out of service this year for P&W’s recall.
Pilot Furlough
With so many jets out of service to deal with the PW1100G issue, and since Spirit Airlines defers deliveries to further free up cashflows and slow expansion, they now have an over-abundance of pilots. As a result, the Airline plans to furlough 260 pilots beginning September 1, 2024. There’s no word yet on how long the furloughs will last, but it’s not out of the realm of possibility to see the furloughs extend beyond a month.
GTF Compensation
Though slowing fleet growth as Spirit Airlines defers deliveries is an intentional move to help save money, the planes they’ve already taken delivery of are those they’d like to use, but can’t. As of January this year, over a dozen neos were out of service due to Pratt & Whitney’s ongoing GTF problems. As a result, Pratt & Whtiney has agreed to compensate Spirit for its loss of use. While the terms of the compensation have not been made public, officials state that the compensation “is estimated to improve Spirit’s liquidity between $150 million and $200 million over the term of that agreement.”
Spirit Airlines Defers Deliveries, Final Thoughts
Like Hawaiian, Spirit doesn’t seem like it can catch a break. But, hopefully, the steps they’re taking to return to profitability will help. Only time will tell, though. One things for sure, if Spirit can get compensation for its broken buses, I’d like to think Hawaiian can, too. After all, the A321neo makes up a significant portion of their fleet, and is heavily relied on for most flights between the Lower 48 and the Hawaiian Islands aside from Oahu. They even fly some South Pacific flights, along with a few thinner Honolulu routes. However, Hawaiian hasn’t been vocal about this, so we’ll just have to wait and see.