U.S. budget airlines, including Spirit and Southwest, are taking drastic measures such as pilot layoffs, flight reductions, and business model changes to survive amidst rising costs and shrinking markets.

• Spirit Airlines announced the furlough of 270 pilots, with another 140 pilots downgraded, starting October 1, in response to financial restructuring after its November 2024 bankruptcy filing.
• Southwest Airlines is abandoning its five-decade-long open seating policy for flights booked beyond January 27, 2026, and cutting 15 percent of its staff (approximately 1,750 people) due to falling demand and recent earnings shortfalls of over 11 percent.
• Facing sluggish demand for low-cost flights, carriers like Southwest are implementing new charges, such as bag fees and basic economy products, and are exploring opportunities in premium travel, recognizing that luxury passengers offer a more reliable revenue source.