Spirit Airlines has begun preparations to wind down entirely after entering bankruptcy with high debt levels and facing jet fuel costs driven by the Iran war. Management concluded that no creditor agreement can offset a cost structure undermined by premium-priced fuel, prompting the decision to cease operations.

News of the shutdown plan triggered a 74% one-day drop in Spirit’s share price, marking the steepest collapse since bankruptcy filing. A proposed $500 million federal bailout in exchange for warrants covering up to 90% of equity stalled, leaving the carrier without a viable lifeline.

JetBlue and other carriers saw stock gains as the exit of a major low-cost rival could reduce price competition on key domestic routes. Analysts anticipate JetBlue might capture additional market share and improve yields, although regulators may scrutinize any resulting industry consolidation.