Issue No. 858

JetBlue Sets Sights on Spirit

Surprise Bid for Spirit Could Derail Deal With Frontier

Pushing Back: Inside the Issue

Well, that was a surprise. JetBlue, seemingly out of nowhere, announced a bid for Spirit. JetBlue's offer of $3.6 billion is $700 million more than what Frontier offered and could derail Frontier's bid. At first, the industry reacted with shock — no one saw it coming. But as the dust settled, the deal started to make sense. After all, it would allow JetBlue to acquire more (and compatible) aircraft and grow into a worthy competitor to the Big Four airlines. But the flip side is that JetBlue-Spirit isn't as obvious a combination as the tie up between two ULCCS like Frontier-Spirit.

And as the dust settled further, consensus built that the real winner actually is Frontier. If it gets Spirit, it immediately becomes a large, truly national ULCC. But JetBlue acquiring Spirit eliminates one of Frontier's main competitors in the budget airline space. Meanwhile, JetBlue, already under the regulatory microscope for its alliance with American, could face even more Justice Department scrutiny for this deal. There's never a dull moment in this industry.

The Airline Weekly Lounge Podcast

Edward “Ned” Russell and Madhu Unnikrishnan discuss the JetBlue-Spirit/Frontier-Spirit merger machinations, and the word from European airlines at the recent Airlines for Europe summit. Just how bullish are European CEOs about summer demand? Listen to the episode, and go here for the archive.


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Feature Story

JetBlue Airways surprised the airline industry when it unveiled a $3.6 billion proposal to acquire Spirit Airlines on April 5, potentially upsetting Frontier Airlines' planned merger with Spirit. But upset or not, Frontier stands to gain no matter what the outcome of which…