Skift Take

Good morning from Skift. It's Wednesday, April 6, in New York City. Here's what you need to know about the business of travel today.

Series: Skift Daily Briefing

Skift Daily Briefing Podcast

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Today’s edition of Skift’s daily podcast explains why JetBlue wants to buy Spirit, Sonder’s hotel-like moves, and Sri Lanka’s challenges with its biggest tourist market.



Episode Notes

JetBlue Airways has shocked the aviation industry by submitting a $3.6 billion bid for low-cost carrier Spirit Airlines, potentially derailing Spirit’s planned merger with Frontier Airlines, reports Madhu Unnikrishnan, editor of Airline Weekly, a Skift brand.

Spirit confirmed it had received an unsolicited offer from JetBlue, which put forth a bid that would offer investors a $700 million premium over the $2.9 billion Frontier-Spirit merger that was announced in February. If the JetBlue-Spirit deal were to be approved, the two airlines would comprise 8 percent of the U.S. market.

However, Unnikrishnan writes a potential deal with Spirit may not make sense for JetBlue. While Frontier and Spirit both operate similar low-cost networks geared toward price-sensitive leisure travelers, JetBlue’s model aims to cater to both leisure and business travelers as it has a premium cabin on some aircraft and flies to popular business destinations. Meanwhile, JetBlue shares fell more than 7 percent immediately after the news of its bid for Spirit broke.

Next, short-term rental company Sonder has plans to shake up the hospitality industry, but it’s calling on its sales team to do what hotel brands typically do. What exactly? Offer companies negotiated rates as well as attract groups to its properties, writes Executive Editor Dennis Schaal in his Online Travel Briefing.

Sonder said last week in its annual financial filing that its sales team would target all business travelers for short-term stays through deals with travel management companies like TripActions and Egencia. Sonder added it would target all business travel, including transient and corporate extended stay, stating groups represent a largely untapped growth opportunity for the company.

We end today in Sri Lanka. Already grappling with a severe economic crisis amidst widespread power outages, its tourism recovery is taking another hit as prospective visitors from India — its largest inbound market — are looking to visit other destinations, reports Asia Editor Peden Doma Bhutia.

The turmoil in Sri Lanka is driving travelers from India to reschedule their planned trips to the Indian Ocean nation and instead visit destinations such as Singapore, Malaysia, Thailand, according to India-based travel agency SOTC Travel. In addition, Air India is reducing its India-Sri Lanka flights from April 9, citing limited demand as the reason for its decision.

Tourism to Sri Lanka had been booming prior to the ongoing crisis. The country welcomed more than 100,000 foreign visitors in March 2022, marking the first time it surpassed that mark in a single month since the start of the pandemic.

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Tags: jetblue airways, mergers and acquisitions, spirit airlines, spirit takeover

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