The budget airline Spirit announced Monday it will delay deliveries of new Airbus planes scheduled from the second quarter of 2025 through 2026 and plans to furlough roughly 260 pilots as part of efforts to boost the company’s liquidity.
According to a press release from the airline, a newly reached agreement with Airbus will defer scheduled deliveries until 2030-2031 and is projected to improve Spirit’s liquidity by approximately $340 million over the next two years.
“This amendment to our agreement with Airbus is an important part of Spirit’s comprehensive plan to bolster profitability and strengthen our balance sheet,” Spirit’s President and Chief Executive Officer Ted Christie said in a statement.
“Deferring these aircraft gives us the opportunity to reset the business and focus on the core airline while we adjust to changes in the competitive environment,” Christie added.
These deferrals, in addition to quality and availability issues with engines supplied by Pratt & Whitney, mean the airline will furlough approximately 260 pilots beginning September 1.
“I am extremely proud of our dedicated Spirit team for their focus and resilience over the last few years. Unfortunately, we had to make the difficult decision to furlough pilots given the grounded aircraft in our fleet and our deferral of future deliveries,” Christie said.
“We are doing everything we can to protect Team Members, while balancing our responsibility to return to positive cash-flow and thrive as a healthy company with long-term growth prospects,” Christie continued.
According to reports from CNBC, Christie told staff members in a memo that although these weren’t the steps the company wanted to take, they were “necessary to ensure a strong and profitable future for Spirit.”
Following the announcement, shares of the Florida-based airline rose, with Investopedia reporting a 4.5 percent increase during early afternoon trading. However, share prices for the airline still remain down by 70 percent since the beginning of the year.