Prime Highlights:

• Spirit Airlines secured $475 million in financingand an additional $150 million from its aircraft lessor, allowing it to continue operations amid bankruptcy.
• The airline is cutting costs, including reducing its fleet, trimming routes, and furloughing about one-third of its flight attendants, as part of its restructuring plan.

Key Facts:

• Spirit filed for its second Chapter 11 bankruptcyin less than a year, citing rising costs and changing passenger preferences.
• The court approved the rejection of 27 aircraft leases, with $200 million of the financing immediately available to the airline.

Key Background:

Spirit Airlines has won court approval for a $475 million lifeline to support its operations, along with a $150 million injection from one of its largest aircraft lessors, as the budget carrier works to stabilize itself following its second bankruptcy in just over a year.

The U.S. Bankruptcy Court for the Southern District of New York approved the debtor-in-possession financing, which allows Spirit to continue operating while undergoing Chapter 11 restructuring. In addition, the court greenlit a $150 million contribution from AerCap and approved the rejection of 27 aircraft leases. According to Spirit, $200 million of the financing will be immediately available to the airline.

Spirit is taking steps to cut costs, including reducing its fleet, canceling many routes, and furloughing about one-third of its flight attendants. Negotiations are also ongoing with the pilots’ union, with Spirit seeking approximately $100 million in concessions from the group.

“We are pleased to have reached another significant milestone in our restructuring, which represents continued progress toward securing a successful future for Spirit,” said Spirit CEO Dave Davis in a statement on Friday.

In recent years, Spirit has faced problems like an engine recall, a failed JetBlue takeover, higher costs, and passengers wanting more premium travel options. To adapt, the airline has introduced roomier seats and expanded fare packages beyond its usual low-cost model, which includes optional add-ons like seat selection and baggage.

Experts say the new funding will help Spirit keep flying and reorganize its business. Despite the challenges, the money will provide the airline with a lifeline to balance its operations and continue to serve its passengers.

The bankruptcy of Spirit only underscores how challenging the market is in the case of low-cost airlines, but the court authorization is an encouraging move into a better future.