After Spirit Airlines filed for bankruptcy last month, the airline is now making moves to reduce debt and expenditures. This included slashing the payroll budget and selling a part of their Airbus fleet.
The proposed sale of aircraft was first announced shortly after bankruptcy. The plan was recently given legal approval to move forward.
’23 Skidoo’ for 23 Airbuses
Fort Lauderdale, Florida-based aircraft leasing company GA Telesis has announced it has received approval to purchase 23 Airbus aircraft from Spirit Airlines. The decision was made at the US Bankruptcy Court for the Southern District of New York.
The deal was first announced on 24 October, 2024, though a judge had to review it because all major transactions require bankruptcy court approval. The judge approved a sale of the first five aircraft on 7 December. The judge then approved the remaining 18 aircraft yesterday.
The Airbus aircraft involved in the transaction include 15 A320s and eight A321s. The press release states the sale will close “over a specific period”. This will allow the airline to speed up its restructuring phase and clear its debts faster.
As of this writing, both parties are discussing the timeline for Spirit’s first deliveries to GA Telesis.
GA Telesis Head of Leasing and Trading Marc Cho expressed his excitement on the recent approval of the sale:
“We are thrilled that the court delivered a conclusive decision on such an expedited timeline…This approval underscores the collaborative efforts of all parties involved, and we look forward to closing this transaction swiftly and supporting Spirit as it executes its restructuring plan.”
More on the Airbus Sale from Spirit
Details on the Airbus sale surfaced back in October. The deal is worth $519 million and consists of some of the airline’s older Airbus aircraft.
From this deal, Spirit plans to free up $225 million in liquidity. The airline reportedly has outstanding debts of over $1 billion going into 2025.
To further free up money for debt, the airline has also furloughed and demoted hundreds of pilots already and has announced even more furloughs for early next year.
Spirit’s plan is to free up $80 million in labor costs for the upcoming year. The airline will also plan to retire all of its Airbus A319s this January, which will help to reduce ongoing expenses.
