Spirit Airlines in trouble: financial losses and debts threaten its future

US low-cost airline Spirit Airlines has announced that it has filed for Chapter 11 bankruptcy protection. The company has decided to use this legal tool to restructure and attempt a rescue, as it faces significant financial problems resulting from the pandemic and a failed merger attempt with rival JetBlue.

Spirit Airlines $SAVE, the largest low-cost airline in the United States, has lost more than $2.5 billion over the past four years and faces mounting debt. That's why it decided today to file for Chapter 11 bankruptcy protection, which will allow it to continue normal operations as it attempts to recover. The company said customers can continue to book flights and fly without interruption. The move comes after the company's stock fell 25% on reports that Spirit is in talks with bondholders over the terms of a possible bankruptcy.

The company has been losing value for several years. Since the end of 2018, when it was still profitable, its shares have fallen more than 100%. CEO Ted…