Spirit Airlines Set to File for Bankruptcy Amid Financial Struggles

Spirit Airlines is reportedly preparing to file for bankruptcy protection following unsuccessful merger negotiations with Frontier Airlines. According to sources cited by the Wall Street Journal, the ultra-low-cost airline is in advanced discussions with bondholders to establish a bankruptcy plan that would gain the approval of the majority of its creditors. The filing is expected to occur within the next few weeks.

Despite a surge in travel demand, Spirit Airlines has struggled financially, failing to report a profit in five of the last six quarters. This has raised concerns about the airline's capacity to handle upcoming debt obligations. In a bid to reduce costs and stabilize its finances, Spirit announced last month that it would furlough approximately 330 pilots by January 31.