Spirit Airlines made this critical mistake that drove its demise

By Claudia Assis and Emily Bary Spirit has canceled all future flights and is immediately shutting down Spirit has canceled all flights going forward. Spirit Airlines is officially shutting down after a 34-run of offering cheap, no-frills flights - one that was ultimately marred by a major strategic blunder. The company shared "with great disappointment" on Saturday that it had begun an "orderly wind-down" of its business. Spirit had been trying to stay afloat but it wasn't able to strike a bailout deal with the U.S. government. All Spirit flights are now canceled, and the company is no longer providing customer service. Travelers with outstanding reservations and who paid via credit or debit cards will get automatically refunded. Other U.S. airlines are offering reduced fares for passengers who had booked Spirit flights that were due to depart in the next few days. See also: These airlines stand to benefit if Spirit shuts down Spirit had been a disruptor in the U.S. airline market, appealing to a cost-conscious consumer base and pressuring traditional airlines to reconsider their pricing strategies. But the company made a big strategic misstep, experts say, by focusing on mainstream routes instead of winning over customers who were looking to fly out of underserved locations. Choosing to directly take on the major airlines, rather than carving out niche routes, was a critical error that doomed the company. Additionally, more mainstream U.S. airlines have been able to double down on premium offerings, like lounges and cobranded credit cards, but Spirit's identity meant that it didn't have the same opportunities to cash in on its customer base. Read: Rich fliers are making United and Delta billions by buying premium perks "They've been flailing for several years," Rob Britton, a professor at Georgetown University, told MarketWatch. Data from aviation-analytics company Cirium showed that Spirit's market share of U.S. passengers was just 3.9% in the month of February, down from 5.1% in the same period a year before. That translated to about 500,000 fewer passengers. The shuttering comes as airlines grapple with the impact of the Iran crisis on fuel prices and consumer sentiment. Spirit has had "bad luck with the war," but even if the war hadn't started, it is unclear if the company would have had a viable way to emerge from bankruptcy, according to Henry Harteveldt, an analyst and president of Atmosphere Research Group. -Claudia Assis -Emily Bary This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal. (END) Dow Jones Newswires 05-02-26 1213ET