Spirit Airlines Is Gone. I’ve Been Saying This Would Happen for Years.
The Brutal Lesson Every Business Leader Needs to Learn From the Airline That Bet Everything on Cheap — and Lost
I’m Not Going to Pretend I’m Surprised
Spirit Airlines ceased all operations on May 2, 2026. Seventeen thousand employees lost their jobs overnight. Thousands of passengers were stranded mid-trip with no customer service to call, no rebooking assistance, and a website that simply said the airline was gone. As CNN reported, it was the first shutdown of a significant U.S. airline since the September 11 attacks — and it happened at 3 a.m. on a Saturday with no warning to the thousands of people who had flights booked that morning.
I am genuinely sorry for the employees who lost their livelihoods. They deserved better from the organization they worked for. And I have real sympathy for the passengers left stranded — including people traveling for medical appointments, weddings, and family emergencies who found out at the airport that there was, as Transportation Secretary Sean Duffy put it, “no one here to assist you.”
But I have to be honest: I am not surprised this happened. I have been using Spirit Airlines as a cautionary tale in my keynotes and consulting work for years. And the lesson I have always drawn from them — the one that is now written in 17,000 job losses and tens of thousands of stranded passengers — is one of the most important lessons in all of business:
You cannot build a sustainable business on price alone. And if your service is bad enough, you cannot even compete on price.
What Spirit Actually Built — and Why It Was Never Going to Work
Spirit’s model was straightforward: strip out everything, charge the lowest base fare, and make it up on fees. Bags, seat selection, water on the plane — everything extra cost money. Their motto was literally “Less Money. More Go.” Their internal language called customers “Guests,” which would have been touching if the experience had ever resembled actual hospitality.
Here is what that model produced in practice. A 1.4 out of 5 rating on Trustpilot from over 17,000 reviews. Consistent placement at or near the bottom of every airline customer satisfaction ranking published by J.D. Power. A reputation so toxic that customers would literally pay $30, $40, even $60 more just to avoid flying with them. As airline analyst Zach Griff told CNN in its post-mortem analysis: “They stripped out so much from the experience… that the folks who ended up stuck on Spirit often kind of despised the experience.”
Read that again. Customers were willing to pay more to not fly Spirit. The very audience Spirit was targeting — price-sensitive travelers — had done the math and concluded that the experience was so bad, the cheap fare wasn’t worth it. Spirit had made their price relevant by making their service so bad that the cost of flying them had nothing to do with the ticket price.
The flight delays, the rude staff, the canceled connections with no hotel vouchers and no accountability, the $90 fee for carrying a fanny pack — these were not occasional failures. They were the consistent, documented, reviewable customer experience Spirit delivered for years. And every one of those experiences was quietly doing math in a customer’s head: “Is the $40 I saved worth this?” More and more often, the answer was no.
The Real Reason Spirit Failed — and It’s Not Jet Fuel
The official narrative around Spirit’s collapse points to rising jet fuel costs driven by the conflict in Iran, two bankruptcy filings, and an industry that had grown too competitive for an ultra-low-cost model to survive. All of that is true. But it is incomplete.
Georgetown University professor and former airline pilot Shye Gilad said it plainly to NPR: “When you’re a low-cost carrier, by definition, you’re relying on having a cost advantage. And they just don’t have that anymore.” The same CNN analysis concluded directly: “Spirit’s failure is a cautionary tale for other discount airlines: competing on price alone can be a losing strategy.”
But here is what those analyses don’t fully capture: Spirit had been unprofitable since before the pandemic. They had been warning investors for years that there was “substantial doubt” about their ability to continue operating. They had filed for bankruptcy twice. They had tried to rebrand, to bundle fares, to offer bigger seats at the front. None of it worked.
Why? Because no brand refresh can fix a reputation that was built one terrible customer experience at a time. Spirit tried to convince customers it had reinvented its service. As Griff noted, “it struggled to convince enough flyers that it had reinvented the service. No one ever compared Delta and Spirit, at least when it comes to service.”
The fuel prices were the final blow. But the wound that killed Spirit was inflicted by years of choosing to treat customers as transactions rather than relationships. By the time they needed loyalty, they had never built any.
“In today’s world, the only thing that is separating companies from offering another commodity is the relationship they have with their Customers. If you do not have a relationship with your Customer, you better be the cheapest.” — John DiJulius, The Customer Service Revolution
Spirit wasn’t the cheapest anymore. And they had no relationship to fall back on. That is not a fuel problem. That is a customer experience problem that had been building for a decade.
I’ve Been Saying This About Spirit for Years. Here’s Why.
I want to be transparent about something. I have used Spirit Airlines as a teaching example in my keynotes for a long time — not to mock them, but because they represented the purest possible illustration of what happens when a business decides that service is a cost to be eliminated rather than an investment to be made.
I have talked for 25 years about the concept of making price irrelevant — the idea that when you deliver a consistently extraordinary experience, a meaningfully large portion of your customers stop comparison-shopping you altogether. They’re not looking for a better deal. They’re not leaving for a competitor who’s 15% cheaper. The experience you’ve built makes the price question feel almost beside the point.
Spirit was the opposite of that. Spirit made price the only point. And in doing so, they guaranteed that the moment a competitor could match their price — or the moment their customers decided the savings weren’t worth the abuse — they had nothing left to compete with.
This is exactly what happened. Other airlines got more competitive on price. Budget carriers like Allegiant figured out how to offer low fares without destroying the experience — Allegiant consistently ranks above average in J.D. Power customer satisfaction despite being a no-frills carrier. Breeze Airways, founded in 2021, became one of the fastest-growing airlines in the country by offering budget fares paired with a pleasant experience. Spirit had no answer to either of those competitors because it had invested nothing in the one thing that creates loyalty.
The Lesson That Applies to Every Business, Not Just Airlines
I am going to say something that might feel uncomfortable for business owners reading this during an uncertain economy: the Spirit Airlines lesson is not just about airlines. It is about every business that has ever told itself that being cheap is a strategy.
Right now, with tariffs rattling consumer confidence and 77% of Americans worried about a recession, the temptation to compete on price has never been stronger. Drop your margins. Run promotions. Race to the bottom. Signal to customers that you are the affordable option.
I understand the instinct. But Spirit Airlines just showed us, in the starkest possible terms, where that road ends. Not just for ultra-low-cost carriers. For anyone who chooses price over experience as their primary competitive strategy.
Here is what the research actually shows about what customers do in a downturn. They do not simply choose the cheapest option. They make a triage. They cut the brands they were never loyal to. And they double down on the brands they love. The brands that made them feel known. The brands whose experience made the price feel irrelevant. As I wrote in The Relationship Economy, the competitive advantage of human connection and genuine care has never been more powerful than in a high-pressure, high-anxiety market.
Spirit had 17 years to build that kind of loyalty. They chose to charge for water instead.
What Separates the Airlines That Survive From the One That Just Didn’t
The same CNN post-mortem that catalogued Spirit’s failures made an important point that I want to highlight: other budget carriers are not doomed. Allegiant and Breeze are proof that you can offer low fares and still build a brand that customers feel good about. The difference is not the price point. The difference is the experience.
Allegiant does something Spirit never figured out: they make customers feel like the low price is a gift, not a transaction that entitles the airline to treat them poorly. Customers say of Allegiant, as the J.D. Power data shows, that it’s “a great value for the money.” Not cheap. Value. That is a completely different emotional experience — and it is built through the consistency of service, not the consistency of low prices.
This is exactly what my X-Commandment Methodology is designed to build. The Never & Always standards, the Customer Experience Action Statement, the employee experience infrastructure — all of it exists to create the kind of consistent, relationship-driven experience that makes customers feel valued regardless of the price point. Whether you are a budget carrier or a luxury brand, the mechanism is the same: make your customers feel something that no competitor can replicate, and price becomes a secondary consideration.
The $500 Million Question Every Business Leader Should Be Asking Right Now
Spirit spent the final chapter of its existence trying to secure a $500 million government bailout. They needed half a billion dollars to survive a fuel price spike that other, better-run airlines absorbed as a serious but manageable challenge.
Why the difference? Because airlines with loyal customers, strong brand equity, and a reputation worth protecting had something to fight for — and something that would fight for them. United, Delta, and Southwest didn’t just survive the fuel crisis. They capped their fares to help stranded Spirit passengers. They could afford to do that. They had built the kind of loyalty that generates revenue even in a crisis.
Spirit had none of that. And in the end, no amount of money — not from creditors, not from a restructuring plan, not from a government bailout — could substitute for the loyalty they had spent 30 years choosing not to build.
The question I want every leader reading this to sit with is this: if your business hit a serious external shock tomorrow — a fuel spike, an economic downturn, a competitor willing to undercut your price — what would your customers do? Would they stay with you because the relationship is worth more than the savings? Or would they leave because price was the only reason they were there in the first place?
Spirit Airlines just answered that question. Your business gets to choose a different answer while there’s still time to build it.
“Price is irrelevant when your customers are so happy with you, they have no idea what your competition charges.” — John DiJulius, The DiJulius Group
Ready to Build the Kind of Loyalty That Survives Anything?
If the Spirit Airlines story feels uncomfortably close to home — if you know your customers are there because of price and you want to change that — let’s talk. My team has spent 25 years helping organizations build the experience infrastructure that makes them irreplaceable. Not just in good times. In any economy.
→ Schedule a Complimentary Strategy Call — Start the conversation about building loyalty that price can’t touch
→ Read: Can You Really Make Price Irrelevant? — The strategy that separates brands customers love from brands they merely use
→ Read: Want to Know the Secret? It Is the Service, Stupid — The data on why service wins in every market condition
→ Get The Customer Service Revolution — The book — and the blueprint for making price irrelevant
→ Get The Relationship Economy — Why human connection is the only competitive advantage that compounds
→ Explore the X-Commandment Methodology — The system behind every world-class service culture I’ve helped build
→ Book John as a Keynote Speaker — Bring the Spirit Airlines lesson — and what to do about it — to your next leadership event
