Spirit Airlines shut down on May 2. Its 18 daily slot pairs at LaGuardia are still sitting there, and the FAA just said it wants another low-cost carrier to get them.
If no low-cost airline steps up, the agency would rather see the slots forfeited.
Spirit ceased operations in the early hours of May 2 after a second Chapter 11 process collapsed. The Florida-based ultra-low-cost carrier had been trying to shrink its way back to profitability when spiraling fuel costs - tied to the US and Israeli military offensive in Iran - blew up its math.
A last-ditch bid for a Trump administration bailout fell apart when White House lawyers and Spirit's lessors couldn't agree on terms.
When the wheels stopped, Spirit was running 18 slot pairs per day at LaGuardia. Those slots are valued at $86.7 million on paper, and they've been sitting idle since the shutdown.
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LaGuardia is one of only three slot-controlled airports in the US, meaning airlines can't just start a new route. They have to bid for a fixed number of takeoff and landing windows each year, and history of usage is one of the biggest factors in who gets them.
The other two slot-controlled airports are JFK and Washington Reagan National. Slots exist because the airport is too crowded to handle more flights without long delays.
FAA Administrator Bryan Bedford told reporters in Charleston, South Carolina this week that the agency will favor a low-fare carrier in the reassignment. "As long as the slots are going to a low-fare airline and for the public good, the FAA and DOT would support that," he said.
If no low-cost carrier wants them, Bedford said he would rather see the slots retired to ease congestion at LaGuardia.
The most obvious candidate is Frontier Airlines. It only holds 7 slots at LaGuardia today and has been the loudest about wanting more.
Southwest could also fit the FAA's definition of low-cost. It already holds about 34 slots at LaGuardia and has the operational scale to absorb more.
What it almost certainly won't be is a legacy carrier like Delta, American, or United - all of which would happily take the slots but don't pass the low-cost test Bedford laid out.
Frontier shareholders are watching this one closely.
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