Why Spirit collapsed as oil surged — and why Spring Airlines (春秋航空) is still making money

Different markets, different models

Two low-cost carriers. Two very different outcomes. Spirit Airlines in the United States abruptly suspended operations and moved toward liquidation after decades of low-fare growth; Spring Airlines (春秋航空) in China reported a strong first quarter with revenue growth and a sharp rise in net profit. It has been reported that Spirit’s lawyers pointed to the recent Middle East conflict and the resulting surge in jet fuel as the decisive blow. But industry analysts say fuel was only the last straw — structural weaknesses and a shrinking customer base had already hollowed out Spirit’s business.

Why Spirit fell apart

Spirit faced fierce pushback from legacy U.S. carriers that adopted “basic economy” fare buckets and monetized many ancillary services, eroding Spirit’s price advantage. Competition, wage inflation, higher operating costs and a steady slide in passengers since 2019 left the carrier financially fragile; the U.S. Department of Justice blocked its proposed merger with JetBlue and Spirit twice sought bankruptcy protection. It has been reported that the U.S. government briefly considered a rescue — reportedly a proposed equity intervention — but creditors opposed the plan. When jet fuel spiked, cash-strapped Spirit had little runway left.

Why Spring Airlines holds a cost edge

Spring Airlines (春秋航空) benefits from a tightly optimized, point‑to‑point model built on a single aircraft family (A320), ultra‑high seat density and heavy direct‑sales penetration. The carrier reported quarterly revenue above RMB 6 billion and year‑on‑year net profit growth of roughly 45%. According to broker research, Spring’s unit fuel burn is about 28% below the industry average and its maintenance costs are far lower than the big three Chinese carriers. High utilization (around 10 flight hours per aircraft per day) and load factors above 90% keep unit costs down. Plus, inbound travel stimulants such as visa relaxations have boosted some Northeast Asian routes — a timely demand tailwind.

Risks remain

Fuel still matters. Spring disclosed that jet fuel accounted for more than a third of costs in 2025 — higher than Spirit’s recent fuel ratio — and analysts warn that sustained high oil prices could erode its margin cushion. International route volatility, airport slot competition and geopolitical shifts (trade and visa policies) are additional uncertainties. So which is the lesson? Market structure and scale matter as much as price. A low‑cost label does not guarantee resilience; fleet commonality, route density, high utilization and diversified demand channels can make the difference between collapse and continued profitability.