Spirit Airlines has officially filed for Chapter 11 bankruptcy.
Early this morning, Spirit Airlines filed for bankruptcy protection—a move many of us saw coming. From its failed JetBlue Airways merger back in January to its looming debt to its poor reputation for shitty food (among many other things, of course), the airline is finally facing its financial woes.
Videos by VICE
The United States Courts define a Chapter 11 bankruptcy as one that “generally provides for reorganization, usually involving a corporation or partnership. A Chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time.”
According to a court filing on Monday, the airline’s estimated assets and liabilities are between $1 billion to $10 billion each, per USA TODAY. The carrier’s goal is to reduce its debt and increase its financial flexibility through an agreement with its bondholders, who committed to a $350 million equity investment.
While this is obviously impacting the airline’s structure, travelers can still book flights and carry on as usual—at least for now.
However, “It is quite possible that by the 45-day mark, which is kind of the end of the year, that we may have some other changes,” Robert W. Mann Jr., a former airline executive officer and current president of R. W. Mann and Co. airline, told USA TODAY. “In the short term, it will be just smaller.”
So, if you are banking on Spirit for your holiday travel plans, you might want to look out for any notices of flight changes.
As for the airline, well, it doesn’t plan on going ghost—or should I say, spirit—anytime soon. This is merely a way for them to hopefully reorganize and come back stronger.
“This set of transactions will materially strengthen our balance sheet and position Spirit for the future while we continue executing our strategic initiatives to transform our guest experience, providing new enhanced travel options, greater value, and increased flexibility,” Christie said in a news release, per Fox Business.
