Collapse of Spirit Airlines a ‘warning’ for budget carriers in Canada

A line of Spirit Airlines jets sit on the tarmac at the Orlando International Airport on May 20, 2020, in Orlando, Fla. (AP Photo/Chris O'Meara, File)

MONTREAL — The demise of Spirit Airlines in the U.S. serves as a warning to smaller carriers north of the border that are beleaguered by high fuel costs and low demand for travel to America.

After two previous bankruptcies, the ultralow-cost airline that once operated hundreds of daily flights on its bright yellow planes said Saturday it was shutting down immediately in the face of soaring oil prices.

Former Air Canada finance executive Christopher Read says the closure shows how thin margins can be for discount carriers such as Edmonton-based Flair Airlines, calling it a “warning” for Canadian operators.

He notes that fuel makes up a much bigger proportion of costs for small, low-cost airlines, which enjoy fewer shock absorbers in the form of higher-margin business travellers and diverse route options.

Flair and Toronto-based Porter Airlines both faced headwinds after staking growth plans on expansions into the U.S. shortly before many Canadians began to shun travel there in response to President Donald Trump’s tariffs and annexation threats.

Experts say the direct impact of Spirit’s disappearance is minimal for Canadian passengers, since the airline did not fly north of the border, but that some Ontarians will miss the option of cheaper Spirit flights to sun destinations out of Detroit.

This report by The Canadian Press was first published May 5, 2026.

With a file from The Associated Press

Christopher Reynolds, The Canadian Press