Spirit Airlines has asked the Trump administration for an emergency bailout as it faces the threat of liquidation over rising fuel costs caused by the Iran war, according to reports.
The budget carrier has struggled to rebound from the Covid-19 pandemic and adapt to shifting demand, as passengers favored full-service airlines when travel resumed. Spirit Airlines ended up filing for bankruptcy twice, first in November 2024 and then in August 2025. By its first bankruptcy filing, it had lost more than $2.5 billion since 2020.
Spirit Airlines appeared to be making a comeback after reaching an agreement with creditors on a plan to slash debt and reduce operational costs. It was expected to emerge from bankruptcy this summer, until the U.S. and Israel began launching strikes against Iran on February 28.
When Iran effectively closed the Strait of Hormuz in retaliation, oil prices surged. Tehran announced Friday that the vital oil passageway was reopened to commercial traffic.
Spirit Airlines had planned for fuel costs averaging about $2.24 per gallon this year and $2.14 next year, Reuters reported. But jet fuel prices have now spiked to around $4.24 per gallon, according to the publication.
Bloomberg reported Wednesday that Spirit was at risk of being liquidated over the rising jet fuel prices. The publication’s sources said a decision to liquidate could come as soon as this week, but a Reuters source said that there are no plans for the airline to liquidate in the coming days.
Spirit Airlines told The Independent Thursday, “We don’t comment on market rumors and speculation. Our operations continue as normal.”
With talk of the carrier potentially liquidating, travel experts warned that customers with booked flights could end up stranded.
But now, there may be hope for the struggling airline, following reports of a bailout request for the Trump administration.
Spirit Airlines has asked the Trump administration for hundreds of millions of dollars in emergency funding to help with the rising fuel costs, people familiar with the matter told the aviation news site, The Air Current.
CBS News later reported on the bailout request to prevent liquidation, with one source saying, “Spirit is looking for a lifeline.”
An official from the Department of Transportation told The Independent that the agency is monitoring Spirit’s situation but would not confirm whether the administration was approached for a bailout.
The Independent has reached out to Spirit Airlines and the White House for comment.
Transportation Secretary Sean Duffy is expected to meet with budget carrier executives, including those from Spirit, next week, according to the reports. Duffy regularly checks in with these carriers and a source for The Air Current said next week’s meeting will focus on the health of the nation’s smaller airlines.
CBS News’ Senior Transportation Correspondent Kris Van Cleave said in a video posted to social media Thursday that if Spirit is forced to liquidate, “Other airlines already have plans in place to offer what they call rescue fares — discounted one-way fares to get people home.”
Katy Nastro, a travel expert with the airfare monitoring site Going, told ABC News that Spirit customers should not cancel their booked flights if the airline does liquidate “because then you forfeit your right to a refund if there's still some money left over to be able to do so."
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