By Sasha Richie, The Dallas Morning News (TNS)
Spirit Airlines filed for bankruptcy on Monday, but your holiday travel plans shouldn't be affected.
According to court documents, the budget airline announced it will file for Chapter 11 bankruptcy protection to restructure greater than $1 billion in debt. Spirit says the Chapter 11 process is “expected to reduce Spirit's debt, provide greater financial flexibility, position Spirit for long-term success, and accelerate investments to provide better travel experiences and greater value to guests.”
The announcement comes after a series of quarterly losses and failed merger attempts with Frontier and JetBlue. The company's stock has slumped over the yr and is anticipated to be delisted from the New York Stock Exchange.
With Thanksgiving just over per week away and Christmas following shortly after, how will this affect the Flyers? That shouldn't be the case, in response to Spirit, who, to be clear, isn't going out of business. Here's what it’s essential to know:
Can I still fly flights booked with Spirit?
Yes. Guests can expect to fly as normal throughout the Chapter 11 process, and this includes any flights already booked.
Can I book future flights with Spirit?
Although Spirit doesn't expect the method itself to affect its employees' wages or advantages, the corporate announced layoffs back in October and sold a few of its aircraft as a part of cost-cutting measures. It's unclear what impact this might need on delays for Spirit flights, which have an on-time rate of 74%, the third-worst this yr ahead of Frontier and JetBlue. in response to a Department of Transportation report.
also reported this earlier this month Spirit will cut some routesincluding to and from DFW, and all affected passengers are entitled to a full refund or rerouting.
Will my loyalty points be counted?
Existing loyalty points, credits or tickets will probably be applied and Spirit has not announced any changes to its loyalty program as a part of cost-cutting measures.
When does the insolvency proceedings end?
Spirit expects the corporate to emerge from the Chapter 11 process by the primary fiscal quarter of 2025, ending March 31.
Spirit's first hearing in bankruptcy court took place on Monday It submitted applications to proceed operations in the traditional course of business because it goes through the method. These requests are often honored, says Spirit.
How can Spirit overcome a lot debt?
Spirit says it has already received commitments from existing bondholders for a $350 million capital investment and can convert $795 million price of debt into stock within the restructured company through a debt reduction and equity capitalization process. Spirit also says it has secured a $300 million loan from bondholders, which it would use along with Spirit's own money reserves to proceed its debt restructuring process.
Several other airlines have filed for bankruptcy up to now, including industry giants like Delta and United, although Spirit is the primary major U.S. airline to file for bankruptcy in over a decade since American did it in 2011.
Originally published:
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