Another US airline has filed for bankruptcy just a month after Spirit’s collapse.
Silver Airways flies to vacation hotspots in Florida and the Caribbean, raising fears about the fate of trips Americans plan in search of winter sun.
It has partnered with other larger airlines such as United and JetBlue for the final leg of travel to smaller airports in Florida and the Bahamas. It also has flights to the US Virgin Islands and Puerta Rico.
The regional airline, which serves 29 destinations with a fleet of ATR turboprop aircraft, filed for Chapter 11 bankruptcy protection on Monday.
But it has reassured customers that it will continue to operate as usual for now.
The airline, which operates flights from Tampa International Airport in Florida, confirmed that all its tickets remain valid.
Future flights can also be booked on travel websites or on the Silver website.
The airline, which has debts of up to $500 million, hopes to complete the bankruptcy process by the end of 2025.
Budget airline Silver Airways filed for Chapter 11 bankruptcy protection on Monday
Creditors include the IRS, which is reportedly owed $2.1 million, and airport authorities in Orlando and Fort Lauderdale, each owed at least $1 million.
“This decision will allow us to secure additional capital and implement a financial restructuring that will strengthen our position as a competitive airline,” the company said in a statement.
The airline appeared to be in trouble in 2023 when it reportedly failed to pay rent at its Fort Lauderdale hub.
The airline had a seven-figure debt on the airport and was evicted. View from De Vleugel reported.
The writing was firmly on the wall when American Airlines dropped them as a codeshare partner earlier this year.
Silver then stopped flying further north of Greenville-Spartanburg, South Carolina, and continued to drain cash, the publication reported.
The bankruptcy filing comes after America’s largest budget airline, Spirit Airlines, filed for bankruptcy in November.
Spirit has suffered a long string of quarterly losses and its last annual profit was posted in 2019.
The no-frills airline has lost more than $2.5 billion since the start of 2020 and faces looming debt payments totaling more than $1 billion in the coming year.
The company has struggled to recover since the Covid-19 pandemic nearly shut down the aviation industry and was hit hard again when problems with RTX’s Pratt & Whitney Geared Turbofan (GTF) engines grounded many of its planes.
Spirit Airlines, the country’s largest budget airline, filed for bankruptcy in November
Ultra-low-cost airlines, which have excelled at keeping their costs low and offering affordable, no-frills travel, have struggled since the pandemic as travelers prefer to pay extra for a more comfortable trip while seeking experiences.
Spirit’s problems, along with those at some of its rival budget airlines, have sparked talk of a flawed business model among some Wall Street analysts.