Investing.com -- Spirit Airlines (OTC:SAVEQ) is laying off around 200 employees as part of a broader effort to reduce expenses and align with its reduced operational capacity, CEO Ted Christie reportedly informed staff on Wednesday evening.
The airline had previously indicated that job cuts might be necessary as it works toward its goal of trimming $80 million in annual costs.
“As you all know, we’re facing significant challenges with our business,” Christie wrote in a message to employees viewed by The Wall Street Journal. “The bottom line is, we need to run a smaller airline and get back on better financial footing.”
Spirit filed for bankruptcy last year as it struggled with heavy debt and increased competition for budget-conscious travelers. The airline also faced challenges after a proposed merger with JetBlue was blocked by a federal judge.
But Christie said Wednesday that the bankruptcy process is progressing as planned, and the airline expects to emerge from Chapter 11 this quarter.
In addition to the latest job cuts affecting multiple departments, Spirit had already furloughed pilots and offered extended voluntary leave for flight attendants. While Christie noted that the airline has reached its cost-saving target, he emphasized that Spirit continues to explore further opportunities to cut expenses and increase revenue.
The airline had nearly 13,000 employees late last year, including about 2,000 nonunion workers, according to court filings related to its bankruptcy case.
Spirit Airlines is the largest US passenger carrier to file for bankruptcy in over a decade, marking a dramatic shift for an airline that once reshaped the industry by making air travel more affordable.
Known for its à la carte pricing strategy, Spirit charged extra for services like water and printed boarding passes. While this approach drew complaints from travelers, its low fares made it one of the fastest-growing airlines in the US.
However, Spirit has faced significant financial struggles, losing more than $2.2 billion since 2020—nearly erasing all the profits it had built since adopting its ultralow-cost model in 2006.