Spirit Airlines Seeks Trump Administration Bailout

Spirit Airlines , a U.S. budget carrier, is in urgent talks with the Trump administration over an emergency rescue package as it tries to prevent an operational breakdown, the company’s lawyer said Thursday.

Speaking at a U.S. bankruptcy court hearing in New York, Spirit’s attorney, Marshall Huebner of Davis Polk, said the airline needs access to existing cash or new financing within days to keep flying. He told the court that the company’s available cash for day-to-day operations is critically low, underscoring the immediacy of the funding need.

The proposed support under discussion includes a $500 million loan from the U.S. government, according to the information presented in court. Under the outline described, the government could end up with as much as a 90% stake in Spirit Airlines, and the structure would place the government ahead of other creditors. The plan has been circulated among multiple creditor groups, indicating that discussions are not limited to the airline and the administration.

Spirit had expected to exit bankruptcy by mid-year, but those expectations have been challenged by a recent jump in fuel prices. The company linked that fuel move to U.S. and Israeli actions against Iran, which it said has complicated its projections for emerging from bankruptcy on the earlier timeline.

The airline’s current situation follows a longer period of financial strain that predates the latest fuel-price increase. Spirit has been dealing with an engine recall, and it also faced a setback when an acquisition by JetBlue Airways was blocked two years ago. The company has also pointed to shifting customer preferences and higher operating costs as additional pressures that have weighed on performance.

In court, the focus remained on near-term liquidity and the ability to maintain operations while the bankruptcy process continues. The key uncertainty is whether Spirit can secure access to cash or new funding within the narrow timeframe described, and whether the proposed government-backed structure—potentially involving a large equity stake and priority over other creditors—can gain sufficient support among stakeholders to move forward.