Delta CEO Says Spirit’s Collapse Shows Limits of Budget Model

Delta Air Lines Chief Executive Officer Ed Bastian said rising jet fuel costs and Spirit Airlines’s collapse are accelerating a divide in the industry between carriers catering to premium travelers and those competing primarily on price.

“Spirit didn’t go out of business because of fuel prices,” Bastian said in an interview with Bloomberg Television on Thursday. “They went out of business because they had a bad product.”

Airlines across the industry are contending with sharply higher fuel costs after the effective closure of the Strait of Hormuz heightened concerns over energy supplies and operating expenses, ...