Monday, May 27, 2024

Airline defers aircraft orders, furloughs pilots to improve finances

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Spirit Airlines announced it will defer deliveries of new Airbus planes from 2025-2026 to 2030-2031 to boost liquidity by $340 million over the next two years. The airline also plans to furlough about 260 pilots in September. Spirit cited the grounding of Airbus planes due to a Pratt & Whitney engine recall and the failed acquisition by JetBlue as factors behind these decisions. The company said the deferrals will allow it to “reset the business and focus on the core airline” as it navigates changes in the competitive environment. Spirit expects to receive compensation for the grounded engines, which would lift liquidity by $150-$200 million. The pilot furloughs are part of the airline’s efforts to align its workforce with its reduced operations. Spirit is also closing its Atlantic City, New Jersey, crew base.

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