Spirit Airlines offers buyouts to salaried employees to cut costs
- Spirit is offering voluntary exit packages to staff to cut spending.
- The airline also paused pilot and flight attendant training to cut costs.
- Spirit is facing weak off-peak demand and aircraft groundings due to a Pratt & Whitney engine manufacturing issue.
Spirit Airlines is offering voluntary exit packages to salaried employees, the budget carrier's latest cost-cutting measure as it expects financial strains to continue next year.
The airline has been facing weak off-peak demand and last month said it will have to ground an average of 26 Airbus A320neo aircraft for inspections of engines made by RTX unit Pratt & Whitney after that company disclosed a manufacturing defect in August, straining its capacity.
"The last few months have been a testament to our resilience and dedication as a company, but we must return to profitability, which will require a series of tough decisions," CEO Ted Christie said in a staff memo on Wednesday, which was seen by CNBC.
The airline had already paused training for new pilots and flight attendants, CNBC reported last month. It has also restricted expense budgets and tweaked its network, including a plan to exit Denver.
"Now, we're taking the next difficult step – enacting an Early Voluntary Out program for salaried Team Members," Christie wrote in the memo. The company had a similar plan during the height of Covid pandemic. "Based on the success of that plan, we're implementing a similar set of opportunities to help us right-size our organization for our current fleet and business constraints."
JetBlue Airways is in the process of trying to acquire Spirit, a deal the Justice Department has already sued to block with a trial that's set to wrap up in the coming days in Boston.
The Wall Street Journal reported the Spirit Airlines buyouts earlier Wednesday