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Spirit Airlines Crisis Exposes Cracks in the Budget Airline Model

NerdWallet·Anna Helhoski·about 1 month ago
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SOME CARD INFO MAY BE OUTDATED This page includes information about these cards, currently unavailable on NerdWallet. The information has been collected by NerdWallet and has not been provided or reviewed by the card issuer. The war in Iran is stress-testing budget airlines, highlighting weaknesses in the model itself and raising fresh concerns for investors, travelers and policymakers. Jet fuel prices have roughly doubled since the U.S. and Israel attacked Iran on Feb. 28, and the pressure on airlines hasn’t been evenly felt. Airlines with more pricing power can just pass higher costs on to customers. Ultra-low-cost carriers — built on rock-bottom fares and razor-thin margins — don’t have that luxury. Fuel costs continue to spike after the blockade of the Strait of Hormuz — a key chokepoint that handles roughly 20% of global oil supply.…

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