Spirit Airlines plans to cut jobs and sell some planes amid looming financial struggles

NEW YORK — Spirit Airlines is cutting jobs and selling several million-dollar planes as the budget carrier aims to cut costs amid looming financial struggles and an uncertain future.

In a regulatory filing Thursday, Spirit said it has identified about $80 million in cost-cutting measures to begin early next year. Those cuts will be driven primarily by a “workforce reduction,” the Florida-based airline said.

Spirit did not specify a number of layoffs or which positions would be affected. A company spokesman declined to comment further when contacted by The Associated Press on Friday.

The budget airline also disclosed that it has agreed to sell 23 planes to GA Telesis, an aviation services company, for about $519 million. The Airbus A320ceo and A321ceo models, which were manufactured between 2014 and 2019, are expected to be delivered from this month until February.

GA Telesis celebrated the acquisition on Friday, noting that it will significantly increase its fleet portfolio. And Spirit expects the proceeds from the sale, combined with the extinguishment of related debt, to benefit its liquidity by $225 million by the end of 2025.

Shares for Spirit were up 25% at $3.01 by midday Friday. But the stock has fallen more than 80% in the past year.

The past few years have been far from smooth sailing for Spirit. The airline failed to return to profitability when the COVID-19 pandemic eased and travel returned — largely due to rising operating costs and increased competition. Rival carriers have wooed some of Spirit’s budget-conscious customers by offering their own versions of low-cost, no-fare tickets.

Loss after loss has continued to pile up in the meantime — with the company losing more than $2.5 billion since the start of 2020. Spirit also faces mounting debt, with payments looming to total more than $1 billion of dollars.

Spirit now expects its fourth-quarter capacity to fall 20 percent from a year ago, according to Thursday’s regulatory filing. And the company expects capacity to drop to the mid-teens for 2025, accounting for this month’s sale and the early removal of other planes from scheduled service due to continued issues with Pratt availability. & Whitney GTF engines.

Bankruptcy speculation has also hovered over Spirit, which has become an attractive takeover target. Although a merger has yet to be successful. JetBlue recently tried to buy Spirit, but two airlines backed out of the deal after a federal judge blocked the purchase over antitrust concerns in January.

Previously, Frontier Airlines also tried to merge with Spirit, but was outbid by JetBlue at the time. Earlier this week, however, The Wall Street Journal reported that Frontier was in early talks to explore a renewed offer, citing unnamed sources familiar with the matter.

The deal, if it goes through, could include Spirit restructuring its debt and other debts in bankruptcy, according to The Journal — which also reported that the airline continues to have discussions with bondholders about a possible bankruptcy filing . A spokesman for Spirit declined to comment.

AP Airlines Writer David Koenig in Dallas contributed to this report.