Donald Trump suggests US could buy Spirit amid bailout talks

{"text":[[{"start":8.3,"text":"Donald Trump said the US is considering buying distressed low-cost carrier Spirit Airlines, after his administration proposed pumping as much as $500mn into the Florida-based airline to fund its exit from bankruptcy."}],[{"start":21.700000000000003,"text":"“We’re thinking about doing it, helping them out, meaning bailing them out, or buying it, I think we’d just buy it,” Trump told reporters on Thursday."}],[{"start":31.000000000000004,"text":"Spirit re-entered bankruptcy last year with nearly $3bn of debt whose holders will have to consent to any deal struck with the federal government or be repaid in full."}],[{"start":41.650000000000006,"text":"In a Thursday hearing in New York bankruptcy court, a lawyer for Spirit said the company had been on track towards emerging from bankruptcy before the Iran war drove up fuel costs."}],[{"start":52.150000000000006,"text":"Trump suggested it would be possible to “sell it for a profit” when “the price of oil goes down”."}],[{"start":58.45,"text":"Lawyers for Spirit told the bankruptcy court that the airline was in “very advanced discussions” with the US government on the terms of a “financing package” that would “create an appropriately capitalised, fierce competitor in the airline space”."}],[{"start":71.25,"text":"Spirit said on Thursday that more than 17,000 jobs were at stake if it was forced to liquidate its operations."}],[{"start":null,"text":"

"}],[{"start":78.85,"text":"Spirit’s lenders had been “excluded” from negotiations between the airline and the US government until they received Washington’s financing proposal on Wednesday, lawyers for a group of bondholders told the court."}],[{"start":92.35,"text":"Analysts at Barclays wrote that a government bailout for Spirit could create problems for rivals Frontier and JetBlue by making it harder for them to raise prices to cope with higher jet-fuel costs. "}],[{"start":103.89999999999999,"text":"Although Spirit’s smaller size reduced the effect on the wider US aviation market, “we nonetheless question the moral hazard associated with publicly funding a struggling low-cost carrier”, the Barclays analysts said. "}],[{"start":116.6,"text":"Spirit was founded in the 1980s and for decades competed with larger carriers by offering low ticket prices and basic services."}],[{"start":125.85,"text":"But it suffered as a result of post-Covid inflation and higher fixed costs resulting from chronic pilot and mechanic shortages. Its woes were compounded as larger airlines offered cheaper basic fares and US consumers increasingly opted for premium seats and services."}],[{"start":143.04999999999998,"text":"The carrier filed for bankruptcy for a second time in August 2025 after emerging from a previous restructuring five months earlier. The first bankruptcy eliminated nearly $1bn of debt but did not make significant operational changes."}],[{"start":158.29999999999998,"text":"The current bankruptcy process has been used to slash jet leases and shrink its operations. The airline’s struggles have been compounded by a sharp rise in jet fuel prices resulting from the Iran conflict, which has led to hundreds of millions of dollars of extra costs for US airlines."}],[{"start":175.14999999999998,"text":"Savanthi Syth, an analyst with Raymond James, said Spirit’s viability had been in doubt even before the impact of the jet fuel price rises started to hit airlines in March and April."}],[{"start":188.04999999999998,"text":"“If you had asked me in January, I would have said I think Spirit can make it through [to] the end of the summer. But I couldn’t see Spirit making it beyond that on a standalone basis.”"}],[{"start":205.4,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1777000992_2216.mp3"}