(Reuters) -Spirit Airlines said on Monday it has reached an agreement with Airbus to delay all aircraft deliveries scheduled from the second quarter of 2025 through 2026 and that it intends to furlough about 260 pilots, as the U.S. carrier looks to save cash.
The low-cost airline said it would defer the scheduled deliveries to between 2030 and 2031. As a result of the deferrals, along with quality issues with engines made by supplier Pratt & Whitney, Spirit is furloughing pilots effective Sept. 1.
A snag with Pratt & Whitney Geared Turbofan (GTF) engines has forced Spirit to ground some of its A320neo aircraft, pinching the company at a time when it is already grappling with a cash crunch due to rising operating costs and lingering supply chain problems.
The company, whose $3.8 billion merger agreement with JetBlue Airways (NASDAQ:) fell through last month, is already in a compensation deal with Pratt & Whitney, which is expected to boost its liquidity by $150 million to $200 million.
Spirit, which has been losing money for several quarters despite strong travel demand, operates an all-Airbus fleet. As of December 2023, the company had a total of 205 Airbus jets.
The agreement with Airbus would improve its liquidity position by about $340 million over the next two years, Spirit said, adding that there were no changes to its aircraft orders with Airbus that are scheduled to be delivered during 2027-2029.
“Deferring these aircraft gives us the opportunity to reset the business and focus on the core airline, while we adjust to changes in the competitive environment,” Spirit CEO Ted Christie said in a statement.
“We are doing everything we can to protect team members, while balancing our responsibility to return to positive cash-flow.”
