Following the blockage of a proposed merger between Spirit Airlines and JetBlue Airways by a U.S. judge, there's a growing concern among Spirit Airlines' pilots about the company's future. This has led to an increase in job applications elsewhere, according to recruiters and industry sources. Scott Haralson, Spirit's CFO, mentioned that the company is considering adjusting its labor costs, which has added to the anxiety. Despite this, a spokesperson for Spirit stated that the level of attrition is normal and the number of pilot resignations this year is below the company's 2024 forecast.
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The company, which is an ultra-low-cost carrier, has been struggling to achieve sustainable profitability due to a decrease in demand in its main markets and the grounding of many of its aircraft because of issues with RTX's Pratt & Whitney Geared Turbofan engines. If the $3.8 billion merger deal continues to be blocked, analysts are uncertain about Spirit's survival. There are suggestions that the company could go bankrupt if it fails to stabilize its finances. Following the court ruling, credit rating agencies such as S&P Global, Moody's, and Fitch downgraded the airline's credit ratings due to increased default and refinancing risks.
The situation has caused stress among Spirit's pilots, some of whom have applied for jobs at Delta Air Lines, United, and American Airlines. The increase in job applications from Spirit's pilots at United has been noted since the court's decision. Despite a slowdown in the job market for pilots after a two-year surge, United still plans to hire 2,000 pilots in 2024, down from 2,350 in 2023. Working for United, Delta, or American Airlines is considered a step up for pilots from regional and budget carriers like Spirit. However, the increased interest indicates growing concerns about Spirit's future. Kit Darby, a U.S. aviation consultant specializing in pilot career development, mentioned that pilots usually don't switch companies unless there's a failure or severe hardship.
A potential departure of pilots could impact Spirit's operations but might also lower costs. The airline had approximately 3,500 pilots at the end of 2023. Despite speculations about its future, Spirit dismissed these as misguided narratives, stating that it has increased liquidity to survive even if the merger doesn't go through. The Florida-based airline has reduced its capacity growth plans and slowed down pilot hiring and promotions last year. It also suspended training for new pilots and flight attendants and offered voluntary time off for cabin crew members. While Spirit mentioned that it was working on solutions for its labor costs due to overstaffing, a spokesperson declined to provide more details, leaving pilots with more questions about the company's future plans.