‘I think we just buy it'- Trump suggests federal take over of Spirit Airlines as oil prices push it to bankruptcy
&imwidth=600&imheight=450&format=webp&quality=medium "‘I think we just buy it'- Trump suggests federal take over of Spirit Airlines as oil prices push it to bankruptcy")
A Spirit Airlines plane sits parked at Hollywood Burbank Airport on April 16, 2026 in Burbank, California Photograph: (AFP)
In a rare move, Donald Trump has signalled that the US government could step in to rescue Spirit Airlines through a potential federal takeover. With rising oil prices and mounting debt, the airline’s future hangs in the balance, but critics warn it could burden taxpayers.
US President Donald Trump on Thursday said that the administration is considering a federal takeover of the struggling budget carrier, Spirit Airlines, if they find a reasonable price for it. The President confirmed this interest in offering Spirit Airlines a lifeline as the oil prices rise to $110 per barrel. The President did not clarify how it is going to happen, but it is exploring a rare direct intervention in the private sector to prevent Spirit from liquidating.
“Spirit is an airline that has had some trouble,” Trump said. “They have some good aircraft, some good assets, and when the price of oil goes down, we’d sell it for a profit.
How does the Trump administration plan to rescue Spirit Airlines?
A lawyer told a US Bankruptcy Court that the airline was in advanced talks with the U.S. government on a financing deal that would allow Spirit to emerge from Chapter 11 protection. The Wall Street Journal and Bloomberg both reported that an amount of $500 million would give the government a sizeable part, at least 90 per cent ownership of the airline. It is likely to save nearly 18,000 jobs. However, aviation experts and other analysts suggest that its an waste of the taxpayers' dollars and if the investors, shareholders and creditors cannot run Spirit Airlines profitably, then the US government will also eventually fail. Republican Senator Tom Cotton and Democratic Senator Elizabeth Warren both have expressed scepticism about investing taxpayer dollars to stage a private bailout.
Why does Spirit Airlines require a bailout?
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The recent energy crisis due to the US war on Iran and the rising prices of jet fuel had tipped it over the edge. This might be the phase of many such corporate bankruptcies and mergers across the US and the globe. Though Spirit's financial health deteriorated following the legacy debt, not just recent geopolitical developments. It was grappling with a massive $7.4 billion debt and lease obligation, and had already filed two Chapter 11 bankruptcies in two years, in November 2024 and August 2025. It had already restructured its debts to stay afloat and was contemplating a merger in 2024. The Trump administration blamed the Biden administration for not allowing Spirit Airlines to merge with JetBlue, which would have allowed it to stabilise the debt but would have driven up the airfare for passengers.
