Spirit Airlines could be on the brink of shutting down entirely, according to a new report, raising urgent questions for travelers across Texas who already hold tickets on the budget carrier.
Bloomberg reported that Spirit Aviation Holdings Inc. is at risk of being liquidated as rising jet fuel prices, tied in part to the U.S. war with Iran, continue to squeeze the bankrupt budget carrier’s finances, citing people familiar with the matter.
Any decision on a potential liquidation could come as soon as this week, according to Bloomberg, though the situation remains fluid as the company continues talks with creditors.
Known for its ultra-low-cost model, Spirit has long operated with thinner profit margins than larger airlines, making it more vulnerable to sudden increases in operating costs.
In early February, Spirits’ parent company said it expected to exit Chapter 11 bankruptcy in the late spring or early summer, according to the Associated Press, after reaching a preliminary agreement with lenders and creditors.
The carrier filed for Chapter 11 bankruptcy protection in August 2025, its second filing in under a year, according to Bloomberg. Spirit’s financial struggles have been building for years. The airline previously attempted to merge with JetBlue Airways, but a federal judge blocked the deal in 2024 on antitrust grounds, according to prior reporting.
Talks with Frontier Airlines resurfaced in 2025, but those efforts also failed to produce a deal, leaving the company to navigate its restructuring on its own.
In response to the Bloomberg report, a Spirit Airlines spokesperson told Chron: “We don’t comment on market rumors and speculation. Our operations continue as normal.”
For now, the airline is still flying its published schedule.
For travelers with upcoming bookings, federal guidance suggests that passengers continue to monitor updates directly from the airline.
According to the U.S. Department of Transportation, if an airline ceases operations, travelers may be eligible for refunds, but that depends on how tickets were purchased and the airline’s policies. Passengers who paid with credit cards may have additional protections through their card issuer.
Spirit Airlines operates its Houston service out of George Bush Intercontinental Airport (IAH), with all check-ins, departures, and arrivals handled in Terminal A. From Houston, the ultra-low-cost carrier runs nonstop flights to a mix of major U.S. cities and popular leisure destinations, including Las Vegas, Orlando, Miami, Fort Lauderdale, Atlanta, Chicago, Detroit, Baltimore, Los Angeles, New York (LaGuardia), and Newark, along with international routes to destinations such as Cancún, San Pedro Sula, Guatemala City, and San Salvador.
For now, Spirit continues to operate normally, even as uncertainty around its future grows. That’s why industry experts, including travel site The Points Guy, recommend holding off on canceling tickets prematurely, as doing so could limit refund options if a shutdown were to occur.