White House mulls using Defense Production Act in Spirit Airlines takeover
Summary
President Donald Trump and his administration are considering using the Defense Production Act to help Spirit Airlines, which has financial problems and has declared bankruptcy twice recently. The plan may include a government loan and using the airline for military needs, with the goal of saving jobs and preventing the airline from shutting down.Key Facts
- Spirit Airlines has declared bankruptcy twice in the last two years.
- The Department of Justice blocked Spirit's merger with JetBlue during the Biden administration.
- Rising jet fuel costs, partly due to the Iran war, have hurt Spirit Airlines financially.
- The Defense Production Act can force companies to prioritize government contracts and provide loan authority for national defense needs.
- The government may lend Spirit $500 million and become the top creditor in bankruptcy.
- The Pentagon could use Spirit flights to transport troops and military cargo.
- Spirit owns 48 planes and leases 83 more as of the end of 2025.
- The plan is opposed by Transportation Secretary Sean Duffy but supported by Commerce Secretary Howard Lutnick and the White House.
- The government would keep control of Spirit’s valuable airport landing and takeoff slots.
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