The past few months have been difficult ones for the airline industry, with no signs that its situation will improve anytime soon.
Increased aviation fuel costs from the Iran war have had cascading effects across the airline industry, leading to higher fares, service cuts, and operational changes. Travelers can expect to feel the effects of these problems for months to come.
In an announcement at 2:23 a.m., just ahead of the 3 a.m. deadline to reach another deal to save the airline, Spirit Airlines said it would begin an “orderly wind-down of operations, effective immediately.” All flights were canceled, and the airline notified customers that customer service would not be available. As such, travelers were left to their own devices to reschedule flights.
After the nation woke up, Transportation Secretary Sean Duffy announced several measures to assist Spirit customers and employees, including caps on ticket prices for rebooking and travel assistance for laid-off employees.
“In a matter of hours, we’ve activated our airline partners to ensure passengers are not stranded, communities maintain route access, fares do not skyrocket, and Spirit’s workforce is connected to new job opportunities,” he said.
Delta, United, American, Southwest, JetBlue, Frontier, Allegiant, Avelo, and Breeze all stepped forward to assist affected travelers. Nevertheless, the liquidation of the airline that accounted for 5% of flights last year is certain to increase flight prices in the long term.
A CBS News analysis of Cirium data found that fares rose an average of 23% for a round-trip flight when Spirit closed a route. Other airlines had been pressured to lower their fares to compete with Spirit’s low-cost tickets, so with Spirit gone, the pressure to keep prices low is much lower.
Cascading effects of the Iran war
Though Spirit’s fall has hit the rest of the industry, the primary source of the problems facing the industry is increased fuel costs resulting from the war with Iran.
Aviation fuel’s sensitive supply chain was hit harder than standard gasoline despite the overall rise in prices for oil-based products.
The Department of Transportation reported that, in February, airlines collectively paid $3.23 billion for aviation fuel. In March, they paid $5.06 billion, a 56% increase. The price per gallon for aviation fuel rose from $2.39 per gallon in February to $3.13 per gallon in March.
Aviation fuel typically accounts for 20% to 30% of airlines’ total operating costs, so the increased cost was certain to be passed on to ticket prices.
The dominance of aviation fuel costs in raising prices was seen in late April before the Spirit liquidation. As of April 20, the average cost for a round-trip domestic flight year-over-year had risen 19% from $304 in 2025 to $335 in 2026, according to Kayak data. The average cost for a round-trip international flight year-over-year also went up 14%.
Cutting back on operating costs
The increase in operating costs has led nearly all major airlines to cut back on operations. Cirium found that airlines have cut 9.3 million seats in major markets from June 1 to Sept. 30, according to Al Jazeera.
Other airlines have cut back on in-flight services to offset increased costs. Beginning on May 19, Delta Air Lines announced it would cease its free snack and beverage service for flights less than 350 miles, nearly 10% of its daily flight total.
SPIRIT IN THE SKY: SPIRIT AIRLINES SHUTS DOWN OPERATIONS WITH ALL FLIGHTS CANCELED
The various problems facing airlines have taken their toll on employees, with some airlines noting a change in the behavior of pilots. The increased activity has led to burnout, cratering the number willing to take on extra work.
Delta Air Lines has been catastrophically affected by pilot cancellations, with an internal memo obtained by Business Insider finding that acceptance rates for pilots taking on extra flights fell from 37% last year to just 2% this year. The airline has been forced to cancel many more flights in response. On May 2, its number of flight cancellations rivaled that of the dying Spirit Airlines.
