FAA Wants Spirit to Sell Its High-Value NYC Airport Slots to Another Budget Airline

US regulators are pushing Spirit Airlines’ estate to auction off its prized LaGuardia Airport slots to another low-cost carrier, warning that a major airline could tighten its grip on the New York market if allowed to acquire them. The Federal Aviation Administration (FAA) has made its stance clear: Spirit must sell its 22 slots at LaGuardia to a budget airline, or risk having them retired to ease congestion. The slots, valued at $87 million in April according to The Points Guy, are a hot commodity due to the high demand for operations at one of the busiest airports in the US.

Spirit’s estate has scheduled an auction for July 9, but the winning bid must still receive approval from a bankruptcy court. The FAA’s preference for a low-cost buyer stems from concerns that a major carrier—particularly Delta Air Lines, which already holds over 40% of the market at LaGuardia—could push its share past 45% with an acquisition, raising antitrust red flags. FAA Administrator Bryan Bedford told the Wall Street Journal that retiring the slots would be preferable to letting a legacy airline snap them up.

Spirit’s bankruptcy restructuring left the airline owing roughly $2 billion, putting the slot valuation into perspective. Frontier Airlines has already stepped in to fill Spirit’s void at airports like Dallas-Fort Worth, Las Vegas, and Orlando, while Breeze Airways took over Spirit’s lone operations at Atlantic City International Airport in New Jersey. The FAA’s move underscores broader concerns that the collapse of Spirit, a key low-cost player, could lead to higher airfares in the absence of competitive alternatives.

Any bidder other than American, Delta, United, or Southwest would be seen as a better outcome by regulators.