Spirit vs. Frontier Case Study: Same Strategy, Different Destination

Exploring the similarities between business and personal finance

In today’s article, we’ll take a look at one of the largest financial events in recent history, and tie it back to its correlation with personal finance. The event I’m referring to is the sudden collapse of Spirit Airlines on May 2nd, 2026.

The reason why we’ll solely be looking at Spirit and Frontier airlines is because these are the 2 major players in the ULCC (Ultra Low Cost Carrier) sector. To add some context, the state of the airline industry on the day Spirit shutdown was very similar to what it looks like today. Extremely high fuel costs, repair costs, and a shortage of many vital aircraft components. This was widespread across every airline, but it especially affected the 2 ULCC airlines because their base margins were already so low due to the discounted price of their tickets.

This begs the question: “If prices of everything in the airline industry put so much of a strain on Spirit which ultimately led to their collapse, why didn’t Frontier fall with them?” This is a valid question for someone who is only looking at the surface-level strategy of these 2 companies because from afar, they look identical. The reason as to why only Spirit collapsed shows up when you look at the situation with a magnifying glass.

For both airlines, they operated with a very similar fleet of largely A320 and A321 aircrafts, making the companies very similar. The one major difference pops up when looking at the type of engines each company chose to use over a course of decades when purchasing new aircrafts. Frontier chose to use a combination of a few different engine types while purchasing new airplanes over the years, while Spirit assigned the infamous Pratt and Whitney Engines to their entire fleet of narrowbody commercial aircrafts. As an investor, this is the equivalent of putting all of your money into a single stock instead of diversifying into many different stocks/sectors. I’m sure you can see where the problem will arise based off of the previous statement alone.

Spirit had little to no issues with these engines until July of 2023 when Pratt & Whitney issued a major recall on their engines, causing Spirit to ground flights and lose millions of dollars due to not being able to service their regularly scheduled routes. Frontier on the other hand, only had to ground a small portion of their planes which did impact the company temporarily, but not nearly as bad as it affected Spirit. Frontier was able to bounce back rather quickly and is still a thriving ULCC airline while Spirit struggled to survive and ultimately shut down operations 3 years later.

The point of explaining this event has nothing to do with airlines. The point is that in finance, an identical strategy does not equal the same end result. In personal finance specifically, you can have the same job, same salary, same mortgage, and same family size as someone else, and still end up in a terrible financial position simply because the surface-level strategy is only one part of the equation.

Imagine two people who each earn $60,000, contribute 10% to their 401(k), own a home, and avoid credit card debt. On paper, their financial plans look almost identical. But one person may have a stable emergency fund and investments spread across different assets, while the other has high-interest debt and no cash reserves. The strategy looks the same from a distance, but the underlying risks are completely different.

This is why personal finance cannot simply be reduced to a list of rules that work for everyone. Saving 20% of your income is generally a good strategy, but if one person earns $40,000 and another earns $150,000, the impact of that 20% is dramatically different. As stated before, even two people with the same income can have completely different outcomes based on their housing costs, family responsibilities, debt, health, and career stability. The numbers may look similar but the financial systems underneath them are far from it.

The Spirit and Frontier situation is a reminder that risk is often hidden until the event that exposes it occurs. Spirit’s decision to rely heavily on one engine type may have seemed perfectly reasonable when those aircraft were operating normally, but the problem wasn’t necessarily the strategy itself, it was how vulnerable the entire system became when something unexpected happened and personal finance works the exact same way. A financial plan that looks perfect during normal times can fall apart quickly when a car breaks down or a job is lost. The goal isn’t to create a plan that works only when everything goes right. It’s to create a financial system that can survive when something goes wrong.

Ultimately, this is why copying someone else’s financial strategy can be dangerous in a variety of different ways. You can plagiarize someone’s investments or career path and still end up somewhere completely different. Mastering personal finance isn’t about finding the one strategy that guarantees success, but about understanding your own weaknesses and identifying where your plan could fail. These are the traits of someone who will succeed with their money.

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This concludes this week’s free publication! As always, we highly encourage anyone with questions or discussion points to join us on the Substack app where we can talk as a community. Engagement and understanding is our number one goal, and we strive to make this a place where financial minds can flourish!

With gratitude,

Isaiah Newsome