Duffy rejects budget airline bailout after Spirit collapse
Sean Duffy says budget carriers do not need federal aid as they have access to private cash. Airlines sought 2.5 billion dollars due to rising fuel costs.
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United States Transportation Secretary Sean Duffy rejected a $2.5 billion bailout request from low-cost airlines on Saturday afternoon following the collapse of budget carrier Spirit Airlines. The decision blocks a proposal from carriers including FRONTIER GROUP HOLDINGS INC to exchange equity warrants for government liquidity to offset surging fuel costs. For investors, the move signals a "lender of last resort" federal stance that forces struggling budget carriers to seek survival in private capital markets.
