Scuttled JetBlue Deal Puts Spirit’s Survival at Risk
A revived merger with Frontier would make sense for the struggling low-cost airline, but there’s no guarantee of regulatory approval.
Tough to go it alone.
Photographer: Brandon Bell/Getty Images
The announcement on Monday that JetBlue Airways Corp. had called off its acquisition attempt of Spirit Airlines Inc. was a bit anticlimactic. Astute investors saw the writing on the wall after a federal judge in January sided with the Department of Justice to block the tie-up. The inevitability became clearer after JetBlue changed chief executive officers in February. To nobody’s surprise, new CEO Joanna Geraghty was unwilling to spend the early days of her JetBlue tenure pounding her head against the wall to get the dubious deal done.
What’s less clear is how Spirit, the largest ultra-low-cost carrier in the US, will muddle through a tough market. Its bargain-hunting leisure customers have been hurt by inflation. The company faces the grounding of part of its workhorse Airbus SA fleet while it gets in line for jet-engine maker Pratt & Whitney to repair a mechanical problem on about 3,000 power plants. Spirit will have an average of 40 aircraft on the ground in the fourth quarter this year out of a fleet of 205 planes.