WEDNESDAY JUN 07, 2023
×
Search AeroXplorer
JetBlue Makes Bid To Acquire Spirit Airlines

JetBlue Makes Bid To Acquire Spirit Airlines

BY JOHN PULLEN 428d AGO 0 COMMENTS

Just after Frontier announced its plan to purchase Spirit Airlines, JetBlue made an even more generous bid to purchase the ultra-low-cost carrier. This offer has acted as a competitive blow to Frontier Airlines, which was hoping to use consolidation to grow its presence across America.

 

Photo: AeroXplorer | Seth Johnson

 

In February of this year, Frontier Airlines announced its plan to acquire Spirit Airlines in a deal valued to be about $2.9 Billion. However, today, JetBlue one-upped its ultra-low-cost rival by offering $33 per share, a 40% premium when compared to the original proposed deal. This news has made waves across the airline industry. Frontier Airlines' stock value has dropped 10%, as doubts regarding whether or not the deal will go through rose.

 

This is not JetBlue's only merger attempt throughout its short history. The low-cost carrier also made a bid for short-lived Virgin America. However, Alaska Airlines outbid JetBlue and won the deal. JetBlue's recent decision shows that it may still be eager to grow through the acquisition of one of its competitors.

 

JetBlue also made a bid for short-lived Virgin America, but Alaska Airlines outbid JetBlue and won the deal. Photo: AeroXplorer | Calvin Stewart

 

Spirit's board has promised to thoroughly review both offers before deciding which airline to pursue. However, regardless of the decision, airline mergers are notoriously difficult. Labor unions, governmental oversight, and integration of staff members and infrastructure can create 

massive headaches that could negatively impact daily operations. Either deal would have to overcome plenty of trials before being approved.

 

If JetBlue and Spirit merge, the impact it could have on fares could be massive. Cities like Newark (EWR) and Fort Lauderdale (FLL), on which both carriers have a strong focus, could see more options but potentially higher fares. However, in markets where there is little low-cost presence, a combined carrier could drive fares down and create more affordable travel options for price-sensitive travelers.

 

Photo: AeroXplorer | Dennys Todorov

 

Only time will tell which deal Spirit Airlines decides to pursue. However, one thing is certain: massive change is coming to the low-cost sector.

John Pullen
John is an aviation enthusiast passionate about the airline industry and the marketing and financial strategies that allow airlines to rise and fall. With a strong background in the history of the industry as well as extensive knowledge regarding current industry events, his insights allow him to publish meaningful and insightful articles about the airline industry.

Comments (0)

Add Your Comment

SHARE

TAGS

NEWS jetblue;spirit;frontier;merger

RECENTLY PUBLISHED

Spirit's Inaugural A321neo Flight Lands in Chicago American low-cost carrier Spirit Airlines recently completed the inaugural revenue service of its brand-new Airbus A321neo. The flight operated on June 7th, 2023 from Fort Lauderdale to Chicago. NEWS READ MORE »
Air India 777 Diverts to Russian City Following Engine Problems On June 6, an Air India Boeing 777-200LR, possibly with U.S. citizens onboard, was forced to divert to a Russian airport after a technical issue with one of the aircraft's engines. NEWS READ MORE »
PGA Tour and LIV Golf Merger: What's in it for Airlines? The PGA Tour and LIV Golf have announced plans to merge into one global golf league after months of legal disputes. The merger is expected to have a significant impact on golf, including in terms of the airlines that currently sponsor the existing leagues. Who will be the league's official airline in the future? NEWS READ MORE »


SHOP

$2999
NEW!AeroXplorer Aviation Sweater Use code AVGEEK for 10% off! BUY NOW

FOLLOW US ONLINE