Budget airline shutdown prompts swift response from government

Transportation Secretary Sean Duffy announced a number of relief measures for Spirit Airlines customers and employees on Saturday. The four major U.S. airlines — United, Delta, JetBlue and Southwest — "are all capping ticket prices specifically for Spirit customers who now need to rebook canceled flights," Duffy said in a Saturday post on X. The airlines will offer Spirit customers who validate they have booked Spirit flights a one-way ticket costing around $200, Duffy said in a Saturday morning press conference. "I would recommend that if you have a ticket with spirit that you actually try to book with these airlines as soon as possible, these offers are not going to be open forever," he said. Additional relief measures for both customers and former Spirit employees will also be implemented, including a pathway for preferential employment interviews at other airlines, Duffy wrote. "There's a demand for aviation workers. So, even American and United have drafted or crafted microsites for Spirit employees to potentially jump the line, jump the queue and get preferential treatment in the application process for the many airlines that are now hiring, whether it's pilots, flight attendants, baggage workers, or even those who have worked in the call centers, you can go to the individual websites to see what's offered by each of the individual airlines," Duffy said. Spirit Airlines announced the shutdown of operations early Saturday morning, Duffy announced."This morning at 3 a.m., Spirit Airlines ceased operations. So what that means is Spirit does not have airplanes in the air flying as of this morning. Also, their call centers are closed, and they don't have staff at ticket counters. So if you have a flight scheduled with Spirit Airlines, don't show up at the airport. There will be no one here to assist you," Duffy said.Duffy also bashed Democrats, particularly the Biden administration, for what he said was their role in quashing a failed Spirit-JetBlue merger. "Why are we here today?" Duffy asked. "There was a proposed merger between JetBlue and Spirit, and Joe Biden and [Biden Transportation Secretary] Pete Buttigieg, along with the Biden DOJ, decided that they did not want that merger to take place." "And at the time, the Biden and Buttigieg DOJ bragged and said, as they canceled the option for this merger, that this was a victory for U.S. travelers who deserve lower prices and better choices," Duffy continued."This merger should have been allowed. And this, today would indicate this is not better for travelers. This is not better for pricing. This is not better for competition. Actually. It's worse. We had an airline go down because the markets were trying to allow two airlines to merge, make them stronger and offer more competition for the American consumer," he said. Duffy also blamed Sen. Elizabeth Warren, D-Mass., for championing the merger's blocking. "Elizabeth Warren at the time chaired the blocking of the merger, saying, that, that Biden, this was a Biden win for fliers. So again, I think it's important that we always look, with the keen eye when airlines want to merge. We care about pricing for consumers," Duffy levied. Additional relief measures Duffy announced included reduced fare from American and Delta on high-volume Spirit routes and price freezes on routes that they've shared with Spirit. Allegiant Air, a budget airline with similar prices to Spirit's, will offer 50 percent discounts on base fares until May 10, Duffy announced.The Transportation Secretary did reveal that the Trump administration was exploring all options for ways to bail out Spirit. "There was a number of ideas being floated on how the government could step in and be helpful to Spirit Airlines. The president was like a dog on a bone trying to figure out a way to keep Spirit afloat," Duffy recalled."In the end, this was a creditor issue. Again, they have the final say of whether they want to do a deal with the government, but also from the government's perspective, we oftentimes don't have half a billion dollars laying around in a spare account that we can put into a bailout of an airline. So there was creative thinking on how it could happen, those two things never materialized." Duffy also downplayed broader risks for the budget airline sector, rejecting the notion that the ongoing war in Iran played a factor in Spirit's downfall."Spirit was in dire straits long before the war with Iran. Multiple times they had filed for bankruptcy. Their model wasn't working. They couldn't get the fiscal health. So this was not the impetus. The war was not the impetus for Spirit," he said. He did reference a recent request from other budget airlines for $2.5 billion, but said it was not necessary. CLICK HERE TO GET FOX BUSINESS ON THE GO"You've heard that other airlines have talked about, requesting a $2.5 billion bailout. I am in continual contact, and my team is in contact with all the CEOs of the airlines. I would say that at this point, I don't think it's necessary. They do have access to cash. If they want to come to the US government, we would be a lender of last resort. If they can find dollars in the private markets, I think that's better for them," Duffy said. This is a developing story. Please check back for updates.