Spirit Airlines on Friday filed for bankruptcy protection for the second time in a year, just months after the budget carrier failed return to sturdy financial footing when it came out of Chapter 11 protection in March.
Spirit debtholders agreed in its previous bankruptcy to exchange $795 million in debt for equity, but the carrier avoided bigger changes to cut costs, like getting rid of planes or more dramatically shrinking its footprint.
The Dania Beach, Florida-based airline said under this bankruptcy, it will reduce its network and shrink its fleet, cuts that it said will reduce costs by “hundreds of millions of dollars” a year.
“Since emerging from our previous restructuring, which was targeted exclusively on reducing Spirit’s funded debt and raising equity capital, it has become clear that there is much more work to be done and many more tools are available to best position Spirit for the future,” Spirit CEO Dave Davis said in a news release on Friday.
Spirit had expected to come out stronger from its previous bankruptcy, which it entered in November and emerged from in March. But the airline was dragged down by continued high costs and weaker U.S. domestic travel demand.
