President Donald Trump said the White House had given Spirit Airlines “a final proposal” for a federal bailout to save the carrier, amid reports the troubled budget carrier is laying the groundwork to wind down its operations.
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The Wall Street Journal, The New York Times and Bloomberg News all reported Spirit is preparing for liquidation, after surging jet fuel costs made its planned exit from bankruptcy all but impossible.
Spirit had in recent weeks approached the White House seeking financial assistance — and Trump initially appeared receptive to the idea, proposing a $500 million package with the U.S. taking a stake in the company.
Yet the plan almost immediately ran into opposition from Wall Street, Capitol Hill and even a member of Trump’s own cabinet. Transportation Secretary Sean Duffy suggested a rescue would amount to tossing “good money after bad.”
“There’s been a lot of money thrown at Spirit, and they haven’t found their way into profitability,” Duffy said in an interview with Reuters. “And so would we just forestall the inevitable and then own that?”
But in remarks to the press Friday afternoon, Trump expressed doubts about the rescue.
“We’re looking at it. But if we can’t make a good deal… no institution has been able to do it,” he said.
Spirit — one of five ultra-low-cost airlines in the U.S. — has struggled for years to sustain profitability. In the first two months of 2026, it lost $60 million — and that was even before the cost of jet fuel touched new records.
The airline attempted to sell itself to JetBlue several years ago, only to see a federal judge side with Biden-era Justice Department officials that such a combination tripped antitrust rules.
Yet some analysts say the loss of a full-fledged airline, especially a budget one like Spirit, would also end up hurting consumers — not to mention its approximately 17,000 employees.
“Even if you’ve never flown on Spirit, you want them in the market to help put pressure on those other larger carriers,” Katy Nastro, a travel expert at Going.com, told NBC News in a recent interview. “It actually helps keep prices cheap. So even if you’re not a big Spirit fan, you want to see them succeed.”
At the same time, a government bailout might also set a worrisome precedent, analysts with J.P. Morgan said in a note last month, warning that Frontier and JetBlue, who’ve faced their own financial struggles, could follow suit.
Earlier this week, a group representing budget airlines requested $2.5 billion from the Trump Administration to compensate for higher fuel costs and stave off raising airfares.
In a statement, the Association of Value Airlines, a trade group that represents Allegiant, Avelo, Frontier, Spirit, and Sun Country Airlines said, “temporary government support to preserve vital industry competition is not without precedent.”
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