Spirit Airlines collapse could drive up airfare across the U.S.

TAMPA, Fla. - The abrupt shutdown of Spirit Airlines has left tens of thousands of passengers scrambling to rebook flights, but the ripple effects stretch far beyond those immediate disruptions.

Industry experts say the biggest long-term impact is the loss of competition in the U.S. aviation market.

Katy Nastro with Going.com says even though Spirit only controlled about 5-percent of the U.S. market, its presence in major cities made a significant difference in pricing.

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"Having a low-cost option in the markets… especially some of these bigger cities where these legacy carriers almost dominate, is really going to impact that cost-conscious traveler," Nastro said.

Spirit operated in major cities across the country and helped vacationers reach popular destinations at rock-bottom prices.

By the numbers:

Spirit operated roughly 500 daily flights and served major travel getaways like Fort Lauderdale, Las Vegas, Orlando, and Tampa.

According to Nastro, data from Cirium Analytics shows Spirit’s presence helped lower fares by about 14-percent in the markets it served.

Without that pressure to compete with lower fare options, she warns some routes could see noticeable increases.

"We may be in for… specific areas to see upwards of 15 to 20 percent more expensive fares due to the fact that we don’t have that low-cost option," she said.

Why you should care:

For travelers, this could mean the end of consistently finding ultra-cheap flights, at least in the short term.

"Is this the death of ultra cheap fares as we know it? I don’t want to be the grim reaper and say yes, but it’s not like ultra-low-cost carriers can jump right into the markets where Spirit operated so overnight, this is not going to rectify itself," Nastro said.

She says the timing makes things worse, as airlines are already dealing with rising jet fuel costs, squeezing budgets for travelers heading into peak summer season and increasing competition for fewer seats.

The backstory:

Ultra low-cost carriers like Spirit Airlines built their business model on ultra-low fares, forcing larger airlines to compete.

Without that "bottom rung" in pricing, Nastro says the entire fare structure shifts upward.

"It’s almost like looking at a ladder: the bottom pricing rung is no longer there and so the next lowest rung actually has risen," she explained.

What's next:

Airlines are expected to move quickly to absorb Spirit’s footprint.

Nastro predicts a "bidding war" for planes, gates and airport slots, with carriers like JetBlue already attempting to expand into former Spirit markets.

"It is likely that we are going to see almost a garage sale of sorts when it comes to Spirit planes and the slots that they held," she said.

Meanwhile, other airlines are also competing for Spirit’s workforce, including more than 15,000 employees now out of a job.

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As the ongoing war in Iran and chokehold in the straight of Hormuz continues to drive up the cost of jet fuel, Nastro says it could get even more challenging for several low-cost carriers to stay aloft.

"We don't want to strike fear that we're going to see another shutdown occur across a smaller carrier, but it is definitely turbulent times ahead, and it is no secret that specific US carriers are struggling, not to the extent that Spirit has struggled, but certain carriers have not made a profit in a number of years coming out of the pandemic, so they are the most at risk," said Nastro. "We don't want travelers to think that we are in for an immediate another shutdown, a bankruptcy maybe in a year or two, maybe, but an immediate liquidation, unlikely in the next few months, hopefully."

What you can do:

Travel experts say passengers impacted by the shutdown should act quickly.

Other airlines are offering limited-time "rescue fares" for stranded Spirit customers, but those deals may not last long and carry tight restrictions.

Nastro says waiting to rebook a future flight could cost you.

"The biggest priority is to rebook yourself on another flight immediately. It’s likely that you’re going to be hit with much higher fares the longer you wait," she said.

TampaConsumer