Donald Trump Weighs Taxpayer-Funded Takeover Rescue For Spirit Airlines

President Donald Trump said his administration is still weighing a taxpayer-funded takeover of Spirit Airlines, with talks ongoing and no final decision yet on whether to move forward with a potential bailout.

Speaking to reporters before departing the White House for Florida, Trump emphasized that a deal to rescue the financially strapped airline remained under review, and he said an announcement could come “as soon as later Friday or Saturday.”

ABC News

Trump told reporters, “We’re looking at it. If we could do it, we’ll do it. But only if it’s a good deal,” and he framed the possible federal intervention as an effort to preserve jobs while stressing that “we have to come first.”

The possibility of a bailout first emerged publicly last week, when Trump floated the idea of the U.S. government offering Spirit a financial lifeline to help keep the airline from going bust and out of business.

In the same remarks, Trump suggested the government would be able to resell the airline known for its bright yellow planes and “no frills” service for a profit once oil prices driven up by the Iran war come down.

The administration delivered what Trump described as a “final proposal” to the airline, and the president said, “We’re looking at Spirit and if we can help them, we will. But we have to come first.”

A lawyer for the airline told a U.S. Bankruptcy Court last week that Spirit was in advanced talks with the government over financing that could allow it to exit Chapter 11 protection.

Spirit Airlines’ rescue deliberations are unfolding against a backdrop of repeated bankruptcy filings and mounting financial strain tied to rising fuel costs connected to the conflict in Iran.

The airline filed for bankruptcy protection in November 2024 and again in August 2025, and the administration’s bailout discussions came as operating expenses and debts continued to mount.

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By the time of its first Chapter 11 filing, Spirit had lost more than $2.5 billion since the start of 2020, and in August 2025 it reported having $8.1 billion in debts and $8.6 billion in assets, according to court filings.

The airline’s parent company revealed in a quarterly report that it had “substantial doubt” about Spirit’s ability to stay in business over the next year, citing “adverse market conditions” including weak leisure domestic travel demand and ongoing “uncertainties in its business operations.”

The Trump administration’s interest in a rescue is also tied to the way the Iran war intensified Spirit’s cash flow problems, with rising jet fuel costs generating unexpected costs across the industry.

CNN described the airline’s situation as “Wracked with financial trouble,” with the conflict with Iran driving up fuel prices and putting Spirit “on the brink of closure.”

Forbes Colombia, meanwhile, described the administration as finalizing a $500 million rescue deal for Spirit, and CNN said the proposal would effectively give the government control of the overwhelming majority of Spirit’s shares.

Inside the Trump administration, CNN reported that officials were divided over whether to proceed with a bailout and how to structure it, with meetings involving Transportation Secretary Sean Duffy and Commerce Secretary Howard Lutnick.

CNN said Lutnick “was pushing” for a deal, while a second source familiar with deliberations suggested he argued it would be a political win for the administration.

CNN also reported that there were reservations about the possibility of a bailout from officials including Duffy, Trump deputy chief of staff Stephen Miller, National Economic Council Director Kevin Hassett, and members of the White House counsel’s office.

Those reservations included concerns about pumping money into a company with a bad financial record, according to CNN’s sources.

CNN described Duffy telling reporters Saturday that Trump was “like a dog on a bone trying to figure out a way to keep Spirit afloat,” and Duffy said he was “in the Oval many times” with the president in the days before the airline shuttered.

Tourinews added that the Trump administration is evaluating resorting to emergency mechanisms to avoid Spirit Airlines’ bankruptcy, including the use of the Defense Production Act to facilitate financing and prioritize key contracts.

CNN reported that the possibility of invoking the Defense Production Act was raised but rejected by the Department of Defense, and it said officials were never able to identify a funding source for the $500 million.

The bailout discussions have triggered criticism from lawmakers and from within the broader airline industry, with supporters arguing that collapse would cost jobs and reduce competition while critics question the use of taxpayer funds.

PBS reported that lawmakers from both parties and members of the Trump administration criticized the idea of using taxpayer funds to keep the ultra-low cost airline afloat, and it said supporters of a rescue—including labor unions representing Spirit’s pilots and flight attendants—argue that a collapse would cost jobs and reduce competition, likely pushing fares higher.

Al Jazeera

Fortune similarly said supporters of a rescue say a collapse would cost jobs, reduce competition and push fares higher, while it noted that lawmakers from both parties and some members of the Trump administration have criticized the idea of using taxpayer funds.

CNN described backlash from both the airline industry and among Republicans in Congress, saying previous bailouts have been in support of all US airlines, not a single carrier or group of airlines.

CNN also reported that Trump’s comments about saving the airline were met with internal complexity, including the need to create a plan for customers left stranded and for the company’s 14,000 employees.

In Tourinews, the urgency is tied to Spirit’s liquidity, with limited funds restricted by creditor commitments and an interest payment default raising the risk of breach of its restructuring agreement that could precipitate key decisions within days if no solution is reached.

Forbes Colombia added that other low-cost carriers were seeking financial aid, with a group meeting Transportation Secretary Sean Duffy and FAA Administrator Bryan Bedford to seek $2.5 billion in U.S. government aid in exchange for warrants convertible into equity.

Beyond the political debate, the sources lay out concrete indicators of Spirit’s shrinking position and the broader fuel-driven pressure on airlines.

Fortune reported that Spirit flew about 1.7 million domestic passengers in February, roughly half a million fewer than it did during the same month a year earlier, citing aviation analytics firm Cirium.

AP News

Fortune also said Spirit sharply reduced its capacity, and it gave Cirium data showing there are about half the number of seats available this month on Spirit flights than in May 2024: 1,646,878 compared to 3,399,378.

Forbes Colombia provided a fuel-price snapshot, saying that on Friday, jet fuel was $4.19 per gallon, according to the US Jet Fuel Index from Argus, up 68% since the United States and Israel launched the first airstrikes against Iran more than eight weeks ago.

Forbes Colombia added that Harteveldt said, “We estimate jet-fuel supply will probably take six months or more to return to normal, or even to near-normal levels,” and it quoted him saying, “We don't know.”

The same Forbes Colombia account said that according to first-quarter earnings calls, most airlines now expect jet-fuel prices to stay above an average of $4 per gallon for the rest of the year.

CNN reported that the White House gave Lutnick the word to tell Spirit CEO Dave Davis that there would be no government bailout.