Spirit To Slash 25% Of Its Network By November

Spirit Airlines plans to slash its network schedule by 25% in November compared to a year ago as part of its ongoing restructuring plan. The ultra-low-cost carrier is being forced into drastic cuts after it recently filed for Chapter 11 bankruptcy for the second time in less than a year. The scheduling cuts will likely be accompanied by further furloughs and layoffs as the airline looks to reduce costs.

Just two weeks ago, Spirit removed all flights in 11 US cities from October 2, so this latest development represents even deeper cuts happening at a rapid rate. While the carrier is expected to keep its core bases such as Fort Lauderdale, Orlando, and Detroit, lower-capacity cities and routes in the Midwest and Western US look most vulnerable to the next round of cuts. Meanwhile, a number of the airline’s rivals are swooping in to take advantage of the vacuum left by Spirit’s departure from key markets.

Network Cuts And Staff Reductions

Vincenzo Pace

CNBC reports that an internal memo circulated within Spirit on Wednesday indicating that the airline is planning drastic reductions to its November schedule. It informed employees that they can anticipate a 25% cut in capacity over 2024, as the airline seeks to “optimize its network to focus on its strongest markets.” The memo says that the carrier is in ongoing negotiations with vendors and aircraft lessors as it evaluates its fleet size, seeking to shrink itself to a more stable footing.

Spirit CEO Dave Davis noted in the memo that these fleet and network reductions will ultimately have a knock-on impact on the airline’s workforce:

“These evaluations will inevitably affect the size of our teams as we become a more efficient airline. Unfortunately, these are the tough calls we must make to emerge stronger. We know this adds uncertainty, and we are committed to keeping you informed as these decisions are made”

Spirit already furloughed 270 pilots and demoted 100 more earlier this year, and flight attendants have been taking voluntary unpaid leaves of absence. Now Spirit’s leadership says that it is engaging its labor unions to discuss the impact of further cuts. The Association of Flight Attendants (AFA) has said that it expects that “this bankruptcy will be much more difficult than the last one”, and it is preparing for discussions with Spirit management regarding changes to the collective bargaining agreement.

Where Might The Network Cuts Happen?

Shutterstock

The exact cities and routes affected by November’s cuts are not yet known, but where the cuts might impact is not that difficult to predict. Spirit will very likely maintain normal operations at its largest bases, especially its Florida routes and routes from Las Vegas to the northeast, as these make up nearly half of its revenue. The airline is more likely to cut the entire operations of smaller cities in the network, especially those with minimal strategic value or few daily flights.

This makes logical sense, as removing a city from the network not only reduces flight costs, but also eliminates all the associated support costs such as ground handling, airport staff, and gate leases. Cities such as St Louis or Savannah with just a single route will almost certainly be impacted. Then there are numerous examples with just 2–3 routes that run less than daily, such as Milwaukee or Phoenix, which are also easy targets

The latter has its Fort Lauderdale route scheduled to end in November, so it’s hard to imagine it holding on. Competitive factors will also need to be considered, such as in Minneapolis. It has daily flights, but both are high-traffic inter-hub routes for Delta Air Lines, and Spirit doesn’t have the cash to take the fight to a much larger, profitable competitor.

The Competitors Are Swooping In

Vincenzo Pace

Spirit’s network cuts are creating a vacuum that its competitors are already rushing to fill. Three US airlines have already taken direct action, and it is very likely that others will follow in the weeks ahead.

Spirit says that it expects its new schedule to be finalized by the end of next week. This leaves a very tight timeline to wind down operations in cities that it might choose to exit. It remains to be seen what exact changes will emerge, and how these will impact Spirit’s staff and customers.