Passengers wait in line at the Spirit Airlines check-in counter at Orlando International Airport.
Paul Hennessy | Light Rocket | Getty Images
Spirit Airlines relented this week, agreeing to sell itself to JetBlue Airways for $3.8 billion, hours after breaking a merger agreement with Frontier Airlines that failed to receive sufficient shareholder support.
The new deal would mean big changes for travelers if it passes legal hurdles.
JetBlue has built a reputation for passenger comforts such as relatively generous legroom, seat back screens, live television, free Wi-Fi, and free snacks such as Cheez-Its and Stellar vegan butter pretzel braids. It also offers business class, with reclining-flat seats.
Spirit, on the other hand, has become a punch line for its sheer service. The cabins on the bright yellow planes are cramped and passengers have to pay extra for “optional services” such as hand luggage and seat selection.
“It’s historic. This is the first time anyone has wanted Spirit Airlines,” The Late Show host Stephen Colbert joked about the deal on Thursday.
Still, Spirit has grown rapidly and profitably by offering cheap tickets to vacation hotspots that are sometimes less than a trip to the movies or a few burgers. However, the airline’s “Big Front Seat” does offer 36 inches of legroom for an extra charge of up to $250.
As the two different airlines continue their plans to combine, here’s what passengers can expect:
What are JetBlue’s plans for Spirit?
JetBlue wants to get bigger and Spirit has the planes and pilots to help him do that. The New York-based airline plans to rebuild Spirit’s planes in the JetBlue style, removing the wrapped seats for a more spacious layout with more amenities.
Together, the airlines would become the country’s fifth largest airline, after American, Delta, United and Southwest. Both have a strong presence in Florida and have both expanded into Central and South America and the Caribbean in recent years. JetBlue started flying to London last year.
The two airlines will continue to operate as separate airlines until after the deal closes, which is subject to regulatory approval. Afterwards, passengers can be confused if they fly in Spirit planes that have not yet been modified.
JetBlue has some experience with such situations through its alliance with American in the Northeast, which allows the airlines to sell seats on each other’s planes. Last year, JetBlue revamped its website to better highlight differences in onboard features such as business class seats or free Wi-Fi.
Despite comedians’ digs, Spirit has improved its reliability in recent years — and outperforms JetBlue by some measures.
JetBlue came in last through May this year out of 10 airlines with on-time arrivals, while Spirit took seventh place, according to the latest available data from the Transportation Department.
According to flight tracker FlightAware, a third of JetBlue’s flights have been delayed and 4% canceled so far this year. By comparison, just over a quarter of Spirit’s flights arrived late and 2.7% were cancelled.
JetBlue’s CEO Robin Hayes says improving reliability is a priority. The airline has scaled back its growth plans, saying it didn’t want to overload its crews and other resources.
“A bigger JetBlue that’s overdue isn’t a better JetBlue,” said Henry Harteveldt, former airline president and founder of Atmosphere Research Group, a travel industry consultancy.
Is this the end of cheap fares?
The Biden administration has vowed to take a tough stance on both consolidation and inflation, so the disappearance of an ultra-low-cost airline could be a tough sell.
“Spirit may not be an elegant experience, but they are cheap,” said William Kovacic, a professor at the George Washington School of Law and former chairman of the Federal Trade Commission. “If they disappear as an independent company…will that remove a source of downward pressure on the price?”
But JetBlue’s Hayes says the airline needs to grow quickly and compete better with major carriers that control more than three-quarters of the U.S. market. Hayes argues that a larger JetBlue would mean more relatively lower fares to more destinations.
Like some airline giants, JetBlue has already added certain low fares that mimic airlines like Spirit. Those tickets also don’t come with seat assignments or other benefits that were once standard on a bus fare.
But JetBlue’s business model of offering more comfort costs more than Spirit’s, meaning it probably won’t offer as many of the lowest rates as Spirit.
Frontier Airlines, meanwhile, says it’s happy to capture more of the ultra-low-cost market after the Spirit deal fell apart. Shortly after the airlines announced the end of their agreement, Frontier predicted it would grow by 30% next year and began fare sales with 1 million seats at $19 each.
The airline will become the largest discount carrier in the US when Spirit is eventually acquired. Others include Allegiant and Sun Country.
“That just gives us a tremendous amount of breathing room for growth,” said Frontier CEO Barry Biffle. “That’s why this is such a windfall for our employees and our shareholders.”
When will this happen?
Not immediately. JetBlue and Spirit expect the deal to be approved by regulatory authorities in late 2023 or early 2024, and then close in the first half of 2024.
Integrating airlines is a lengthy and expensive process. For example, United and Continental flight attendants didn’t even fly together until eight years after those airlines merged in 2010.
Adjusting aircraft could also take years, and JetBlue could not start that process until 2025 with the Spirit fleet. But the airline notes that it recently upgraded more than 100 of its Airbus aircraft with new interiors.
“We have a lot of recent experience of how to do it,” Hayes said.