Spirit Airlines Sells 25 Aircraft to Reduce Debt, Generating Over $400 Million

Spirit Airlines has sold 25 planes as part of a sale and leaseback agreement, a move aimed at managing debt repayments. This strategy has successfully generated $419 million in net cash proceeds for the airline. The sale is set to help the carrier address approximately $465 million in debt related to the aircraft, marking a crucial step in stabilizing its financial status.

Spirit Airlines, known for its extensive fleet of over 200 A320-family aircraft, has also announced plans to retire its A319s by the end of 2025. The sale and leaseback transaction, detailed in a filing with the US Securities and Exchange Commission (SEC) last week, involves a significant portion of its fleet. Each aircraft in this deal averaged a sale price of just over $16.75 million.

Despite the financial challenges, including a reported net loss of over $157 million for Q3 2023, Spirit has been working on fleet modernization and financial restructuring. The airline’s fleet currently includes a majority of A320s, with plans to introduce more A320neos and transition to A321neos in the near future.

Meanwhile, Spirit Airlines, along with JetBlue, awaits a crucial decision on their proposed merger. The trial, which concluded in early December, faces opposition from the US Department of Justice (DOJ) on antitrust grounds. The DOJ argues that the merger could lead to higher airfares and fewer options for low-cost travel. The judgment, expected this month, could result in the creation of the country’s fifth-largest airline if approved.

Sources: AirGuide Business airguide.info, bing.com, simpleflying.com