By Sabrina Valle, David Shepardson, Rajesh Kumar Singh and Doyinsola Oladipo
WASHINGTON, May 2 (Reuters) - Bankrupt discount carrier Spirit Airlines ceased operations on Saturday, the industry's first casualty linked to the Iran war, after failing to secure creditor support for a U.S. government bailout plan.
The collapse of the carrier following a doubling in jet fuel prices during the two-month-old Iran war will cost thousands of jobs. It is a blow to President Donald Trump, who had proposed $500 million to save Spirit despite opposition from some of his closest advisers and many Republicans in Congress.
No U.S. carrier of Spirit's size - it accounted for 5% of U.S. flights at one point - has liquidated in two decades. Spirit helped keep fares lower in markets where it competed against major carriers.
ALL FLIGHTS CANCELED, RIVALS TO BENEFIT
A Spirit board meeting had ended without an agreement to rescue the company, a person close to the discussions told Reuters late on Friday.
"Unfortunately, despite the Company's efforts, the recent material increase in oil prices and other pressures on the business have significantly impacted Spirit's financial outlook," Spirit said in a statement announcing "an orderly wind-down of operations."
All flights have been canceled, the statement said, asking passengers not to go to the airport.
Spirit had 4,119 domestic flights scheduled between May 1 and May 15, offering 809,638 seats, according to data from aviation analytics firm Cirium.
Global carriers are contending with surging jet fuel prices since the U.S.-Israeli strikes on Iran disrupted traffic through the Strait of Hormuz, in the air travel industry's worst crisis since the COVID-19 pandemic. Spirit was already struggling to turn a profit before the fuel shock.
Source: Drudge Report
