Spirit Airlines Delays A320neo Deliveries, Plans Pilot Furlough

In a move it hopes will help end its streak of quarterly losses, Spirit Airlines has reached a deal with Airbus to delay future A320neo aircraft deliveries. Spirit will also furlough hundreds of pilots in a bid to cut expenses.

Spirit Airlines Will Fulough Pilots, Delay A320neo Deliveries 

For six consecutive quarters, Spirit Airlines has reported a quarterly loss. That is all the more concerning during a period of banner profits for its full-service competitors.

Spirit thought a merger with JetBlue and the creation of a larger and more robust carrier was the answer. But the Department of Justice won its legal battle to stop the merger from happening, with a federal judge siding with the government in an eye-raising opinion.

> Read More: The Spurious Legal Reasoning Behind JetBlue-Spirit Merger Decision

Forced to go it alone, Spirit plans to defer aircraft deliveries and furlough parties in order to preserve cash flow.

First, it will delay all aircraft deliveries scheduled from Q2 2025 through 2026. Those delivery slots will be deferred to 2030-2031. Spirit was set to receive six A320neo jets during this period.

Second, it will furlough about 260 pilots. In addition to the delivery deferrals, Spirit continues to deal with quality-control issues with its Pratt & Whitney Geared Turbofan (GTF) engines. Spirit, which has a fleet of 2015 Airbus jets in its fleet, expects up to 40 of its jets to be grounded by the end of the year over the engine issue.

Analysts seem to think that Spirit must continue to cut routes and even totally exit some markets. While routine route adjustments are necessary for any carrier, cutting to growth and profitability has never struck me as a winning long-term strategy. If these cuts are not careful and short-term, the carrier will only face more pressure from its legacy peers.

CONCLUSION

With ongoing engine issues and weakened demand for budget carriers, Spirit will defer delivery of six jets and begin furloughing pilots later this year. The failure of the JetBlue merger has awakened Spirit from its lethargy as the carrier struggles to survive.

image: Spirit Airlines