Spirit expects Q4 unit costs to fall

Washington DC
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Low-cost carrier Spirit Airlines expects its unit costs excluding fuel to be down 2% to 3% in the fourth quarter.

The guidance takes into account a $1.5 million cost associated with an ongoing seat maintenance programme that will be incurred in the fourth quarter, as well as flight cancellations due to Hurricane Sandy, says Spirit's chief financial officer Ted Christie in an earnings call today.

Spirit incurred $2.3 million in start-up costs related to the seat maintenance programme during the third quarter, bringing the total cost related to the programme to $5.4 million. The balance will be incurred in the fourth quarter, taking the estimated overall cost to $7 million.

Spirit's chief executive Ben Baldanza previously told Flightglobal that he expects the seat maintenance programme to be completed in November. At any one time, two aircraft out of service for the work.

The airline also expects a "significant negative" impact from Sandy, which resulted in Spirit cancelling 136 flights through today, says Baldanza today. He did not quantify the impact, but says the airline will update on the situation when it fully accesses the impact.