Dr. Kruti Lehenbauer

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Dr. Kruti Lehenbauer

Dr. Kruti Lehenbauer

@analyticstx

Data Scientist | Economist | AI Advisor | Increasing SMB Profits by 10-20% with Data Audits & Strategic Action Plans

San Antonio, TX Katılım Mart 2024
53 Takip Edilen39 Takipçiler
Dr. Kruti Lehenbauer retweetledi
Gary Brode
Gary Brode@Gary_Brode·
Who’s at Fault in the Spirit Liquidation Over the past few days on X, many have engaged in the game of assigning blame for who’s responsible in the Chapter 7 liquidation of Spirit Airlines. The people who lean Republican point to Senator Elizabeth Warren bragging that she had been warning that an acquisition of Spirit by Jet Blue would lead to “fewer flights and higher fares”. When the DoJ succeeded in blocking the merger, Warren claimed that “This is a Biden win for flyers”. (x.com/SenWarren/stat…) The people who lean Democrat claim that President Trump is at fault because the war in Iran has led to higher oil prices. They claim that the increase in the price of crude led to losses at Spirit that caused the bankruptcy. For a detailed response to that, @RobertMSterling has two excellent posts. In one, he explains the history of the Jet Blue deal and why he blames Warren and the Biden Administration (x.com/RobertMSterlin…) and in another, he gives a helpful description of the difference between Chapter 11 and Chapter 7 bankruptcies (x.com/RobertMSterlin…). The reason that matters is Spirit filed Chapter 11 in both 2024 and in 2025, and just filed for Chapter 7. That’s three bankruptcies in three years. Higher oil prices are never a positive for airlines, but I think the people claiming that’s the reason for the bankruptcies are missing something. Let’s look at the data first. (Afterwards, we can point fingers at politicians.) Take a look at the first graph below. Spirit’s profitability (the blue bars) generally rose from 2005 through 2017. That trend was present even though oil rose from around $60/barrel to $100, then declined to the low $40s before rising again. In this early period, Spirit was able to generate consistently more net income regardless of whether the price of oil rose or fell. Net income turned negative in 2020 even as the price of oil plummeted. Of course it did. The world shut down and most people were afraid to travel, or limited from doing so by government restrictions. By 2022 and 2023, we heard the term “revenge travel”. People who had been isolated at home raced to airports and cruise ships to reengage with the world and start traveling again. Demand for flights skyrocketed at the same time that inflation caused a massive spike in oil prices. In this period, we can claim that Spirit net income was negative in 2020 and 2021 due to travel restrictions and negative in 2022 due to high oil prices. Oil prices fell hard in 2023, 2024, and 2025, yet Spirit’s negative net income fell further to record lows. We now have one early period when profitability rose regardless of fluctuating oil prices, and another later period when profitability plummeted despite falling oil prices. Clearly, there has to be something else happening. There is. Now, check out the second chart labeled CASM ex-fuel. CASM stands for Cost per Available Seat Mile. It’s the measure of how much it costs an airline to fly one seat one mile. Think of it as the efficiency of airline operations excluding the cost of fuel. That’s where Spirit used to excel. One big reason the airline was able to offer such low fares was they kept costs low. (I flew a Spirit flight once. It was such a miserable experience that I swore I never would again. You got low fares and terrible service.) Spirit’s CASM spiked in 2020. That makes sense. Airlines have high fixed costs and people weren’t flying. But take a look at the skyrocketing costs in 2023, 2024, and 2025. This has nothing to do with fuel. It’s the cost of airplanes, pilots, ground crew, baggage handlers, and gate agents. The real story here isn’t the Iran-related increase in oil prices during the past few months. It’s the fact that Spirit’s operating costs (excluding fuel) rose more than the cost of fuel fell in those years. This airline declared bankruptcy in 2024 and in 2025 and the real issue wasn’t oil or Iran. It was the cost of everything but oil. Senator Warren claimed responsibility for herself and the Biden Administration for killing the deal that would have kept Spirit’s assets running under the Jet Blue flag. I believe her. As for the people claiming that Spirit’s bankruptcies are due to oil prices, the evidence says otherwise. If you’ve read this far, thank you. I’d like to recognize DKI Intern, Kunal Arora who spent his Sunday doing the research behind the graphs here.
Gary Brode tweet mediaGary Brode tweet media
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Dr. Kruti Lehenbauer retweetledi
Veriten
Veriten@TeamVeriten·
Today on #COBT we had the pleasure of hosting Dr. Kruti Lehenbauer, Founder of @analyticstx. Kruti is a longtime statistician and economic consultant who has held leadership roles across analytics, data, and research. She holds a Ph.D. in Public Policy and Political Economy and helps organizations audit business data, uncover hidden efficiencies, and navigate strategic planning, AI adoption, and more. She regularly shares thought-provoking insights and translates complex analysis into clear, actionable takeaways. We were delighted to hear her perspectives on interest rates, inflation, tariffs, and more ahead of next week’s Fed meeting.
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