Biden’s Economic Pilot Error, not Trump’s War, Killed Spirit Airlines

As with many risky ventures, the best way to make a small fortune in aviation is to start with a larger one. So it is for the employees, owners, creditors, and ticket holders of Spirit Airlines after the company abruptly ceased all operations in its recent financial crash landing.

With daily flights around the country to and from Columbus, Cleveland, and Akron/Canton, tens of thousands of Buckeye travelers and thousands of airline and supplier employees will directly experience the turbulence from the company’s collapse. And as usual, the chattering class immediately began blaming the Trump administration, held aloft by evidence more fragile than the wax wings of Icarus.

Spirit blamed its failure on the sudden rise in fuel prices resulting from hostilities in Iran. This excuse ignores numerous other airlines that are still flying high despite the higher cost for Jet A. Fuel prices also weren’t responsible for Spirit’s two bankruptcy filings in the 18 months prior. Those facts didn’t stop myriad partisan commentators from blaming the Trump administration for stranded travelers and the loss of jobs.

So why did Spirit fail? One of the reasons traveling in a winged tube seven miles above the ground at nearly the speed of sound is so safe today is because of a culture that prioritizes root-cause analysis when things go wrong. In this case, the root cause of Spirit’s metaphoric crash rests with the Biden administration’s Attorney General, Merrick Garland, and Secretary of Transportation, Pete Buttigieg. It was their abuse of federal antitrust regulations that doomed Spirit by blocking the merger with its larger competitor, JetBlue, in 2024.

Turning back to making a small fortune from a large one in aviation, it bears noting that in the entire post-WWII history of commercial aviation, the industry is notable for frequent boom and bust cycles so severe that its cumulative net profits hover near zero. Such is the allure of aviation that entrepreneurs are willing to risk it all to prove they can beat the odds.

Spirit’s ultra-low-cost carrier business model produced razor-thin margins that left little room for operational or market missteps. Improving economic conditions in the U.S. over the past few years have lessened demand for Spirit’s no-frills flights relative to the larger full-service legacy carriers. Spirit’s business model and limited route structure gave it virtually no pricing power to raise fares. They were unlikely to survive any market turbulence, and a merger with a larger competitor was their only way out.

The blocked merger was a death knell that left Spirit slowly bleeding out. The bankruptcies that followed made it impossible for the company to obtain the financing it needed to fly above the clouds of unexpected fuel cost increases, leading to its final, inevitable collapse.

There was certainly no guarantee the merger would have been successful. However, JetBlue’s own plans made it clear that they intended to run Spirit’s planes on JetBlue’s slightly higher service model and raise fares accordingly. The merger was Spirit’s only lifeline and the blocked deal made it impossible to find out if consumers were willing to pay a bit more for a better service and access to more cities.

That was the core failure of the Biden administration’s approach to antitrust enforcement.

Their argument against the Spirit-JetBlue merger was predicated on the anti-competitive cost to consumers from the loss of Spirit’s low fares. While JetBlue’s plans supported that argument, they conveniently ignored that the cost of Spirit’s collapse would hurt consumers even more. But that sums up the government’s ignorance when meddling in business strategy.

The aviation business — or any business for that matter — is hard enough without the heavy hand of government central planners thinking they know better.

In a rational world, the progressive pols who championed and cheered the government’s hijacking would acknowledge their complicity in what followed. Instead, they’ve doubled down, pointing to the Reagan-appointed judge and, of course, Trump’s high fuel costs, rather than their own economic pilot error.

In his usual manner, Trump couldn’t stay out of the cockpit either. His administration mishandled the controls with an ill-advised 11th-hour bid to save the airline. Markets are always a better judge of business winners and losers than the government will ever be. 

As a pilot for 35 years and a business owner for most of that time, I’ve kept a close eye on the business of aviation. I’ve never built an airline, but the politicians who wrecked Spirit have never built anything except their egos and reckless abuse of power.

I’ll miss crossing paths in the sky with Spirit’s big yellow Airbus airplanes packed with excited and sometimes nervous passengers, evincing school buses packed with similarly enthusiastic students. I’ll also miss hearing the radio chatter with air traffic control using the “Spiritwings” call sign that always reminded me of the spirit that draws so many of us to aviation in the first place.

Of course, the real losses will be felt by the thousands of Spirit and supplier employees who’ll be missing their paychecks.