Spirit Airlines is deferring all aircraft on order from Airbus that were scheduled to be delivered in the next two years
Spirit Airlines has announced that it will defer all Airbus aircraft scheduled for delivery from the second quarter of 2025 through to the end of 2026.
The budget airline reached an agreement with the European plane manufacturer to postpone the delivery of the planes until 2030 and 2031. “Deferring these aircraft gives us the opportunity to reset the business and focus on the core airline while we adjust to changes in the competitive environment,” said Spirit President and Chief Executive Ted Christie.
“In addition, enhancing our liquidity provides us additional financial stability as we position the company for a return to profitability.” The deferrals are expected to boost Spirit’s liquidity by approximately $340million over the next two years.
The Florida-based airline also revealed plans to furlough 260 pilots from September 1 due to the deferrals and ongoing issues with the availability of Pratt & Whitney GTF engines. Pratt & Whitney recently agreed to compensate Spirit, which grounded 13 of the planes in question in January with the expectation that number would rise.
Spirit estimated the compensation agreement with Pratt & Whitney would improve its liquidity by between $150 million and $200million. Spirit shares saw a less than 1% increase in morning trading, reaching $4.45 per share.
The company’s stock hit an all-time low this year following the blockage of its $3.8billion merger with JetBlue by a federal judge who stated the deal would damage competition and hike prices for air travellers. Prior to the collapse of the JetBlue deal, the merger was seen as a saving grace for the beleaguered Spirit, which last reported a full-year profit in 2019.
