Spirit Airlines filed for bankruptcy for the second time this year. As you may recall, Spirit had courted Frontier, and later JetBlue for an acquisition. Had the federal government not intervened, JetBlue would have integrated Spirit. Instead, Spirit has failed for the second time this year to get itself out of a hole. It is not that JetBlue is doing so much better, it has pulled back and tried to change direction because it isn’t making money either, but it is clear the premise of denying the JetBlue Spirit Merger, a premise based on increasing customer competition, did not produce the results the court expected. Instead of a combined carrier that could compete better with the larger carriers, we get two carriers struggling to find their way.
Spirit has long been made fun of for its ultra-low-cost mentality. Its former CEO, the late Ben Baldanza, famously commented back in 2007 that a passenger could tell the world how bad they were. that Later, Baldanza refused to refund a dying veteran’s money, explaining that they need to act that way to ensure low fares. Maybe it is the fact that happened 18 years ago, Baldanza has tragically passed since then, and Spirit has moved away from such tactics that make me reconsider that point of view. I listened to Baldanza many times on the Airlines Confidential Podcast, now hosted by former WSJ Middle Seat columnist Scott McCartney. I even am the one who asked them to add an RSS feed so I could subscribe in my favorite podcaster.
In response to airlines like Spirit, the larger carriers introduced Basic Economy…all the unbundled pricing that had been led in the US by airlines like Spirit. So, when given the choice between Spirit and the big three, it isn’t a surprise that Spirit is being left in the dust. There is nothing distinctively competitive about it anymore.
