By Dean Seal

Spirit Airlines' demise makes it even easier for airlines to charge higher fares.

The company's collapse last weekend removes a decades-old carrier that helped set the floor for cheap flights -- and pressured bigger competitors to keep pace. Even though Spirit shrank as it struggled in recent years, the airline was selling rock-bottom tickets right up until the end, such as a $25 one-way ticket from Atlanta to Fort Lauderdale, Fla.

Airlines have since pledged to help stranded Spirit customers by temporarily capping fares. Some have rolled out discounts on routes that Spirit operated through early May. That relief for travelers isn't permanent though, and industry observers expect prices to rise.

"Fares will go up. There is no way around it," said Courtney Miller, founder of aviation-data provider Visual Approach Analytics. Though Spirit ultimately failed, he said, the Florida-based carrier had been effective at holding down fares on its main routes.

A spokeswoman for Airlines for America, an industry trade group representing large carriers, said it is difficult to determine whether fare increases are linked to Spirit shutting down during a time of surging jet-fuel costs.

The fuel-price run-up, driven by the Iran war, has added pressure on airlines to increase fares. The average price of a domestic airline ticket in the U.S. increased 24% between Jan. 5 and April 20, compared with a 3% increase during the same time frame last year, according to data from travel-search company Kayak. Prices for international flights leaving the U.S. have surged 50%.

The pain was acute for Spirit. The carrier had been scaling back its operations for years as it grappled with a high debt load and intensifying competition from larger carriers. Its flights accounted for 1.8% of the domestic air-travel market when it closed, down from a peak of more than 5% in 2023, according to aviation-analytics company Cirium.

Still, the company said it helped hold down ticket prices. After Spirit exited routes between the second quarter of 2024 and the second quarter of 2025, average fares increased by 23%, according to Spirit, which cited data from Cirium.

"Passengers paid an average of $60 more for a round trip on the same route after Spirit exited -- that's close to a $250 increase for a family of four," the airline has said.

'Spirit effect'

Spirit traces its roots to an airline that began providing chartered flights in the 1980s, and later competed for major domestic routes. In the mid-2000s, the carrier embraced the ultradiscount model pioneered in Europe by Ryanair and EasyJet, advertising cut-rate fares while charging for everything from bags to in-flight snacks.

Spirit's growth -- and profitability -- spurred major carriers to develop their own basic-economy fares and move faster to lower prices. A 2024 research paper by the Transportation Department's Office of Inspector General found that major airlines reduced their lowest-cost airfares when discounters including Spirit, Frontier and Allegiant began flying a new route.

The "Spirit effect" was core to the Justice Department's antitrust case against JetBlue's planned $3.8 billion acquisition of Spirit. A federal judge in 2024 blocked that deal, agreeing with the government that travelers would face higher costs if Spirit went away.

Henry Harteveldt, founder of the airline advisory firm Atmosphere Research Group, said Spirit's strategy helped open up air travel to a broader swath of the public that wouldn't be able to afford flights otherwise. Without Spirit, flying might become less accessible to hourly-wage earners and families, he said.

Liz Myers, a single mother from Evanston, Ill., has flown Spirit for years, taking her kids to Walt Disney World and traveling to work-training events . She said she cried when she learned Spirit was closing.

"We didn't fly it because we can afford other things and we're just being cheap," Myers said. "We fly Spirit because we're broke."

Fare well

Airline executives say fares have been overdue to move up, pointing to other industries that pushed through price increases in the years after the Covid-19 pandemic raised operating costs.

United Airlines Chief Executive Scott Kirby said last month that airfares in 2025 were 27% lower than they were before the pandemic when adjusted for inflation. In response to the health crisis and plummeting travel demand, carriers reduced flying and cut prices.

As the pandemic receded, carriers including Spirit and Frontier Airlines held fares low to maintain a competitive advantage, despite rising labor and maintenance costs. Bigger airlines, meanwhile, used their basic-economy fares to compete with the discount players and attract more budget-conscious fliers.

That has reshaped the landscape for cheaper flights. Carriers said last month that demand has been resilient despite higher fares, giving them little incentive to pull back their prices.

"What you see in the industry right now is that air travel is still a really, really good value," JetBlue President Marty St. George said last week on an investor call.

Beyond raising base fares, companies have also parked aircraft and increased fees like those on checked bags to address rising costs.

In the weeks before Spirit closed down, the company warned that travelers' pocketbooks would feel the airline's absence if it vanished. Some travelers are already there.

Lindsey Hand, a communications coordinator in New Jersey, used to take Spirit flights as many as 10 times a year to Orlando, Tampa and other Sunshine State destinations. Those trips won't happen as often now that Spirit is gone, and her work flights out of Philadelphia will carry a heftier price tag, she said.

"It's a shame," Hand said.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

May 04, 2026 22:00 ET (02:00 GMT)

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