Welcome to this week’s edition of The Up Front Update, with a wide range of news from across the industry. As one low-cost carrier hits turbulence, another cautiously expands, and a third becomes a frequent flyer sweet spot — while two airlines run at full anime-blur speed in surprisingly similar inflight entertainment directions.
The big news this week: Spirit on the defence after “going concern” questions from quarterly SEC filing
In the increasingly tumultuous all-economy end of the market in the United States, the ongoing woes at US low-cost carrier Spirit Airlines are looking increasingly problematic.
Much has been made of its SEC filings, including its quarterly 10-Q report, which was remarkably pessimistic, citing problems including “minimum liquidity covenants in our debt obligations and credit card processing agreement”, notably that its “credit card processor [has] requested additional collateral to renew our credit card processing agreement, which expires on December 31, 2025”.
The filing also included the line that “management has concluded there is substantial doubt as to our ability to continue as a going concern within 12 months from the date these financial statements are issued”.
Chief executive officer Dave Davis, newly arrived from Sun Country, subsequently emailed staff — as reported [X] by CBS’ Kris Van Cleave — to note that “this is a phrase required by our outside auditors to convey that there is risk if we do not make changes. But, we are.”
Some of those changes, as outlined in Update numbers 5 in late June and 6 in early July, include rebundling its seats in ways where metaphors about rearranging the deck chairs on the Titanic feel a little too on-the-nose.
There’s a point at which the A320ceo and A320neo aircraft Spirit uses, and indeed the delivery slots that it has with Airbus, are more valuable — whether in terms of owned value as assets or prospective value to a lessor — operating for other airlines, especially in the context of ongoing engine constraints on the A320neo generation.
This week on The Up Front:
It’s ten years to the week that I took to the skies over Hamburg in Lufthansa’s vintage 1936 Junkers Ju 52, so I decided to put together a selection of the photos and videos — including a fifteen-minute video with all the thrum of those wonderful old engines.
Flying Lufthansa’s now-grounded “Tante Ju” Junkers Ju 52: a photo and video retrospective
“Tante Ju”, as the aircraft is lovingly known, was retired in 2018, and is to be a centrepiece of the forthcoming Lufthansa conference and visitor centre in Frankfurt.
We also talked ongoing seat delays — and what the industry is doing about them — with aviation journalist Leonard Berberi for his feature in Milan’s Corriere della Sera, for those Italian readers among you.
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