For the third time since Spirit declared Chapter 11 Bankruptcy last year, the airline is undergoing merger talks with rival ultra-low-cost carrier (ULCC) Frontier Airlines. Will the third time be the charm?
It’s Been a Tough Year for Spirit Airlines
When Spirit Airlines declared bankruptcy late last year many, myself included, thought that a merger with Frontier Airlines made the most sense. The two carriers operate the same Airbus A320 family aircraft and largely have complimentary route maps.
Unlike fellow ULCC Allegiant, which only offers point to point flights primarily from underused airports, Spirit and Frontier are happy to connect passengers through airports like Denver (DEN) and Fort Lauderdale (FLL).
Spirit ultimately rejected not one but two proposals from Frontier, electing to move forward with the restructuring process as an independent airline. Since emerging from Chapter 11 Bankruptcy protection in March 2025, things haven’t gotten any better for the Florida based ULCC.
Since March, the airline has seen its CEO step down abruptly, issue a regulatory filing indicating doubts about its ability to continue as a going concern, declare bankruptcy for a second time, and cut roughly half of its fleet. Things came to a head last week when it was reported that the carrier’s shutdown could be imminent before additional funding was secured early this week.
While the airline has been knocked down plenty, it still is not out.
Spirit and Frontier Re-engage in Merger Talks
While it was mentioned that merger talks were underway, Bloomberg has confirmed what many expected, Frontier and Spirit are once again engaging in talks. It’s worth noting that talks are still underway and this is far from a done deal but, this is likely the best path forward for Spirit.
No details have been revealed regarding what a potential merger of the two would look like but, Frontier announced on Monday that its longtime CEO, Barry Biffle, would be stepping down effective immediately. James Dempsey, the President of Frontier, will act as CEO on an interim basis.
The ULCC market has shifted significantly since the two carriers first discussed a merger. There has been a noticeable shift towards premium products in recent years and many ULCCs are feeling the pressure. Frontier ($ULCC) shares are down 30% YTD though it is on much stronger footing.
This is just the latest twist in the Spirit saga and it will be interesting to see of this merger comes to fruition or if Spirit decides to go a different route.
Summary
After a rough 18 month stretch which saw it declare bankruptcy twice, Spirit Airlines and Frontier Airlines are once again engaged in merger talks. Nothing has been finalized but we could see the two ULCCs combined in early 2026.