Spirit Airlines reaches amended agreements with pilots and cabin crew to access new financing
Spirit Airlines obtained $475 million of DIP financing from its bondholders in October.
Spirit Airlines has announced that it has reached agreements to amend its collective bargaining agreements (CBAs) with its pilots and flight attendants, a key condition that will allow the airline to access the fourth debtor-in-possession (DIP) financing tranche.
On December 12, 2025, Spirit Airlines confirmed that its pilots, represented by the Air Line Pilots Association, International (ALPA), and flight attendants, part of the Association of Flight Attendants-CWA (AFA), have ratified their new CBAs.
While the agreements will have to be approved by the United States Bankruptcy Court for the Southern District of New York, which oversees its Chapter 11 bankruptcy case, the new CBAs represented “the shared commitment of Spirit's Team Members and principal labor unions to build a stronger foundation and future for the company.”
Dave Davis, the President and Chief Executive Officer (CEO) of Spirit Airlines, who took over the carrier following its first Chapter 11 bankruptcy case, which ended in March, thanked ALPA and AFA for their collaboration regarding the new labor agreements and for the “unwavering dedication and professionalism they demonstrate every day.”
“We are pleased to reach another milestone in our restructuring, moving us forward in our mission to better position the airline and secure a future with value travel options for Americans.”
In court filings, Spirit Airlines detailed that the new CBAs will satisfy cost savings stipulated in its DIP financing agreement, allowing the airline to draw another tranche of DIP funding.
“[...] now that the New CBAs have been ratified by the unions’ members, Spirit has satisfied one of the conditions necessary to receive the fourth tranche of DIP funding.”
The airline also estimated that it will save up $100 million in costs annually due to the new agreements with its pilots and flight attendants. Once approved by the court, the CBAs will be effective for a two-year term from January 1, 2026.
According to the court filing, pilots’ hourly wages will be reduced by 8%, while flight attendants’ minimum credit hours will be slashed from four hours and 30 minutes to four hours. The cabin crews’ per diem rate will also be capped at $2.99, among other things.
“These New CBAs will provide stability and predictability for [Spirit Airlines], as well as cost savings, which will assist [the airline] in competing in a challenging marketplace.”
In October, when Spirit Airlines managed to squeeze out a net profit, yet still was operationally loss-making, it paid $112.3 million in salaries, wages, and benefits. In Q3, those costs were $367.3 million, compared to $427.1 million in Q3 2024.
During the same month, on October 10, the court approved the carrier’s DIP financing of $475 million, a “multi-tranche” facility from its existing bondholders. At the time, Spirit Airlines said that $200 million was immediately available to the airline and its liquidity needs.
Rytis Beresnevicius
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