A Spirit Airlines aircraft undergoes operations in preparation for departure at the Austin-Bergstrom International Airport on February 12, 2024 in Austin, Texas.
Brandon Bell | Getty Images
Spirit Airlines said Monday that it will defer deliveries of new Airbus planes and furlough about 260 pilots as it tries to boost liquidity.
“This amendment to our agreement with Airbus is an important part of Spirit’s comprehensive plan to bolster profitability and strengthen our balance sheet,” CEO Ted Christie said in a release on Monday. “. “Deferring these aircraft gives us the opportunity to reset the business and focus on the core airline while we adjust to changes in the competitive environment.”
Spirit said it will defer all Airbus planes it has on order that are scheduled for the second quarter of 2025 through the end of 2026 until as long as 2031. The budget airline said it would boost its liquidity by about $340 million over the next two years.
Miramar, Fla.-based Spirit has been looking for ways to boost liquidity and convince investors that it is on track to do so as it struggles with the the grounding of many of its Airbus planes because of a Pratt & Whitney engine recall. Its planned acquisition by JetBlue Airways fell apart earlier this year after a federal judge ruled in January that the deal would be anticompetitive.
The airline said on March 29 that it will receive monthly payments in compensation for the grounded Pratt & Whitney engines through the end of 2024, which would lift liquidity between $150 million and $200 million.
The pilot furloughs would take effect in September, Spirit said.
Other airlines have adjusted their hiring and training, citing a scarcity of aircraft and a sharp change from the pilot shortage that worsened when travel demand snapped back after the worst of the pandemic. United Airlines pilots’ union late last month said the company is offering unpaid time off for pilots next month because of late-arriving planes from Boeing.