[dtnewman]

I am personally happy with this decision. I don’t love flying spirit but I respect them, ever since hearing their former CEO speak on a Planet Money podcast.

He said straight up that Spirit Airlines is aiming to be the Dollar General of the skies. If you want something luxurious, go elsewhere. But he called out the other airlines who pretend like they are the Nordstrom of the skies, but don’t actually live up to that.

[haliskerbas]

Spirit also doesn’t live up to that in my experience. Their cost structure nickel and dimes the consumer so much that by the time you get to the destination you may have paid more for a much less comfortable trip.

At least in my anecdotal experience.

[TinyRick]

> Their cost structure nickel and dimes the consumer so much that by the time you get to the destination you may have paid more for a much less comfortable trip

That lends more credence to the comparison against Dollar General and similar discount stores. Dollar stores generally charge a higher price relative to quantity, but they offer smaller quantities than big box stores which allows their customers to spend less (but also get a lot less). Wendover on YouTube did a video on this recently [0].

[0] https://www.youtube.com/watch?v=vQpUV--2Jao

[busterarm]

I've flown on Spirit twice, as a side effect of living in Miami.

The last time I did they canceled my flight overnight at 2:30am and forced me to rebook my ~$300 flight at twice the cost -- and it was leaving the same airport at the same time to the same destination.

And it was a miracle that I woke up to the email alert and was able to rebook my flight before it sold out anyway.

[YeBanKo]

And of course such a thing could have happen only with Spirit, right? Could not be any other airline. Like United would never cancel a flight without an ample notice and helpful customer success agents rebooking you trip hassle free.

[sokoloff]

Flights being cancelled? Sure, that happens to anyone operating mechanical equipment with required crews (and duty limits) and in variable weather.

I've never felt jerked around with any of the majors when it came to rebooking travel. They can't conjure up an empty seat that doesn't exist, but I've also never been required to pay a higher fare for them to take me on the itinerary that I originally booked.

Delta in particular I think is quite good at recovery from irregular ops (at least for their higher tier frequent fliers), but on the few instances with other carriers, I expect (and have received) decent and fee-free service when the airline cancelled a flight or missed a connection due to airline fault. I fully expect to have a crappy experience on Spirit whether or not they cancel the original flight.

[busterarm]

I've had shitty experiences with other airlines but that one was unique/notable.

It does seem like post-Covid all of the airlines are racing to the bottom for quality.

I've had canceled flights before but no other airline has ever forced me to rebook effectively the same flight at double the rate and wait the 8-10 days for the refund on my original flight to my credit card. Back when I was a brokie (you know, Spirit's main customer base) that kind of shit would have been trip-ending.

[OkayPhysicist]

I've never run into any issues with United's support. A pretty similar situation happened to me, didn't cost me a dime.

[thehappypm]

Yes. But this is super transparent on their site. You can get super cheap flights if you don’t care about checking bags, in-flight sodas, and so on.

[setr]

To add credence to that statement… LAX to LAS is a $20 flight one-way through spirit. It’s cheaper to fly a family of four than drive. It’s wild how cheap spirit becomes on certain routes, especially short hops where you can trivially get away with nothing extra

[OkayPhysicist]

For Spirit, a carry-on is considered an extra. That's an extra $35 right there, which brings it pretty much inline with Southwest's pricing.

[mdhen]

Get a big backpack, i got a tom bihn synik 30 that qualifies as a personal item. Let's me carry enough for any short trip without having to use a carry on.

[wddkcs]

They allow you up to two personal items/small bags.

[daynthelife]

Just to add some data points, I’ve flown spirit many times (at least 20), have never paid any more than the base cost, and have never had any issues. Maybe it’s just that I go in with the expectation that I’ll receive no special service, but my overall experience has been fine.

Of course, I wouldn’t fly spirit if I had a complex flight itinerary or needed to be 100% sure I would arrive when expected. Then again, I’ve had more issues with other airlines (looking at you Alaska) as well, so go figure.

All that being said, the invisible variable most of us miss is plane maintenance. I don’t know what spirit’s record is in particular on this axis, but some airlines really skimp on maintenance costs, sometimes leading to entirely preventable disasters ([0] to name one of many)

[0] https://en.wikipedia.org/wiki/Alaska_Airlines_Flight_261

[delfinom]

Sounds exactly like a Dollar General or any "dollar store"

https://thehustle.co/the-economics-of-dollar-stores/

[paul7986]

If you are a lite traveler .. fly with clothes in book bag then Spirit is the way to go and it's cheap. If you expect same experience you get from the others ..free checked luggage, refund or credit if you missed your flight, free peanuts and a soda, quick user interface / experience to book a flight, customer service rep to talk with and possibly free wifi you shouldn't bother with Spirit (spend more money for those things).

As a lite traveler Spirit fits my needs and I have more money in my pocket for my trip(s). As well I'm off the plane with my book bag and out of the airport quickly! I always get an aisle seat up front.

[iclosem]

But without this deal they will go bankrupt and then there will be no Dollar General of the skies and the customer loses. Maybe allowing private markets to work would have been a good idea?

[SOLAR_FIELDS]

Can we even say that JetBlue succeeding and/or the merger moving forward would be a win for the consumer though?

The problem with aerospace is that it has a very high barrier to entry, so consolidation ends up hurting the consumer more often than not. Same as other infra related industries like telcos and civil engineering work that require fairly massive upfront capital and regulatory investments to operate.

Better to leave a hole in the market to encourage new entrants, even if it means consumers suffer in the short term.

[squirrel6]

I agree with you even though I think some will view this as a hot take. It is interesting that the US government has historically subsidized both smaller telcos and airlines to fill these types of small gaps where they exist.

[edgyquant]

Sounds like spirit is not a sustainable business and that is an issue unrelated to the merger. Unsustainable businesses fail, so let them fail

[closeparen]

The purpose of blocking mergers is to promote competition, which is plainly not achieved if the acquisition target is not sustainable on its own.

[corethree]

It's utterly clear that free markets can fail and can eventually lead to all kinds of additional problems like wealth inequality and monopolies. This is clear.

Nobody is clear about the right move on how to deal with this problem. There's no sure fire conclusion.

[tyingq]

Spirit runs with a 28 inch seat pitch, which is often physically shorter than the distance between someone's rear end and knee caps[1]. It's an unusual choice. Most other low cost carriers have 31 inches or more. I'm not sure Dollar General is the right comparison.

[1] Once you account for the padding, the angle you have to sit at, etc. Even if you aren't unusually tall, it is noticeably awkward and cramped.

[coldcode]

I have never flown Spirit due to being 6'5". 30 in seat pitch is anatomically the limit, and that hurts. JetBlue having 33 in makes it a good choice for me.

[dgfitz]

I am the same height, and I have, and by golly was it a miserable flight. Never again.

[pxx]

Considering reorganization under bankruptcy is not equivalent to going out of business.

[squirrel6]

There’s not a lot of room for effective restructuring here — for Spirit it’s more of a revenue problem rather than just a debt service problem. They’d probably end up in Chapter 7 (liquidation) pretty soon after starting Chapter 11 proceedings

[HWR_14]

While true, it is equivalent to shareholders in that they get wiped out.

[no_wizard]

I don't feel sorry for shareholders here. There are risks with all investments and its not as if Spirit mislead investors or acted fraudulently. Sometimes, investments go bad, thats the risk.

We shouldn't prioritize shareholders over the general health of a marketplace

[HWR_14]

But it makes sense that with those alternatives shareholders would vote in favor of a buyout or a merger.

[adabyron]

It should be noted that these were 2 small airlines trying to merge together with very little overlap & a willingness to divest more if the Government would work with them. The government refused to talk divestures & it seemed just wanted to block this deal to set a precedence. I do not think they care about Spirit's future or competition here.

Another important item from the trial - only 1/3 of Spirit customers pay the low fee without add-ons. The rest go for something more Jet Blue like anyways.

The precedence that the judge set here is more important than the actual merger. If any tiny subset of customers are harmed the deal cannot go through. I was really surprised to see this from a judge appointed by President Reagan. This could really crush M&As in America.

[rising-sky]

> Rivals on average cut prices 7% to 11% when Spirit enters a market[1][2].

The same cannot be said for JetBlue

> “If JetBlue were permitted to gobble up Spirit — at least as proposed — it would eliminate one of the airline industry’s few primary competitors that provides unique innovation and price discipline,” Young wrote. “… Worse yet, the merger would likely incentivize JetBlue further to abandon its roots as a maverick, low-cost carrier.”[2]

> This could really crush M&As in America.

That's a bit hyperbolic. If it does crush anti-competitive / anti-trust mergers, that's a win in any capitalist's book

[1] https://money.usnews.com/investing/news/articles/2024-01-16/... [2] https://www.washingtonpost.com/transportation/2024/01/16/jet...

[adabyron]

On the first 2 arguments - Spirit was able to be successful for a few years. That's no longer the case. They're not profitable. I believe this was stated by multiple airline CEO's publicly.

> That's a bit hyperbolic. If it does crush anti-competitive / anti-trust mergers, that's a win in any capitalist's book

The judge literally ruled here that a very small market (1/3 of customers on a small airline) would be harmed. JetBlue was also willing to discuss divestures & the government refused because they didn't care about competition or working with JetBlue. They have been doing weak cases for the past few years in hope to get any precedence set that makes M&A harder.

The judge uses the DOJ's expert witness's findings even after agreeing with JetBlue's team that the witness's model was completely broken.

This was a pro-competitive merger in my opinion because it created a stronger rival for the big 4, albeit still roughly half the size of most of them.

[rising-sky]

If the argument is 1/3 vs 2/3, seems pretty clear where the ruling would fall if those are the two options.

> ...the government refused because they didn't care about competition or working with JetBlue.

I take it this is your opinion based on your perception?

However from the U.S.News link I posted above

"The judge, who had questioned whether further asset divestitures could make the deal work, said, "The courthouse doors remain open, should the defendant airlines decide to try again."

You can also read the actual ruling [1] which states:

> _"Throughout June 2022, JetBlue made a series of revised offers to acquire Spirit, with increases in per-share price, increases in the reverse termination fee, and commitments to divestitures. Spirit continued to resist, citing continued concerns about the anticompetitive nature of such an acquisition. On June 6, 2022, Mr. Christie received an email from Mr. Hayes with an attached new, revised offer for Spirit Airlines. On June 27, 2022, JetBlue made a further amended offer to purchase Spirit; the Spirit Board did not view this amended offer as better and did not accept it. Instead, Spirit issued another press release on June 28, 2022, reaffirming its commitment to the transaction with Frontier and noting that the “[l]atest offer from JetBlue does nothing to address our Board’s serious concerns that a combination with [JetBlue] would not receive regulatory approval.”_

So even the Spirit board did not prefer this acquisition, even with the divestitures, but acquiesced to expected shareholder concerns on value maximization

[1]https://s3.documentcloud.org/documents/24362262/jetblue.pdf

[adabyron]

The judge asked the DOJ if there were any divestures that could be made that would make them think this deal should go through. They said no. I believe this was in the closing statements. JetBlue also tried to work with the DOJ before the trial & had no luck. JetBlue did divestures without anyone's requests to win over Spirit agreeing to this. The DOJ was never interested in them though.

In the end, Spirit should have stayed with their Frontier merger though the DOJ probably would have tried to block that as well.

Today Spirit is saying they will be looking at restructuring. Every analyst seems to be saying they are going to declare bankruptcy.

I have no idea how the DOJ or the Judge sees this as increasing competition, which I'm all for by the way. Even if Spirit doesn't go bankrupt they cannot compete as a low fare provider anymore. They will just slowly bleed for the next several years as they sell off and are unable to grow. Same with JetBlue now as well.

[volkl48]

They are the 6th and 7th largest airlines in the country. They are small only relative to the 4 largest.

The best argument I see for allowing the merger is that Spirit has been consistently losing money since the pandemic and may no longer have a viable business model. If they're destined for shutting down in the long run anyway, then you may as well let them attempt to merge, that'll probably lead to less of their market share winding up with the 4 biggest than them simply closing up shop will.

[nashashmi]

> The Justice Department argued that smaller, low-cost airlines like Spirit helped reduce fares and that allowing the company to be acquired by JetBlue, which tends to charge higher prices than Spirit, would have hurt consumers.

In the new era, practices, perceptions and mission statements have to also be up to a standard, not just statistics. I wonder how long this could go on for.

[toyg]

> I was really surprised to see this from a judge appointed by President Reagan

Really? How old is he, 80? Why do Americans insist in having such geriatric leaders, they're starting to make Iran look normal...

[rootsudo]

Well then say goodbye Spirit. They are about to enter bankruptcy.