Inside the White House deliberations over rescuing Spirit Airlines

WASHINGTON—Members of President Trump’s team aired differing views at a private meeting on Tuesday night at the White House about the administration’s plan to save Spirit Airlines, according to people familiar with the matter.

In front of the president, Commerce Secretary Howard Lutnick and Transportation Secretary Sean Duffy each gave their perspectives on the deal being worked on to possibly give a financial lifeline to the struggling airline.

Lutnick argued to Trump that the president would see a political win by coming to Spirit’s rescue months before the midterm elections and that the deal could save thousands of jobs, according to a senior administration official and other people familiar with the matter.

Lutnick is the architect of the proposal under consideration by Trump and the company, in which the government would loan the company up to $500 million and receive in return warrants to take a potential significant stake in Spirit, some of the people said. The Wall Street Journal first reported Wednesday morning on the plan, which hasn’t been finalized.

The commerce chief was also a driving force behind a deal last year for the U.S. to take a large stake in chip maker Intel, one of several agreements in which the administration has taken ownership positions in private-sector companies.

Duffy, on the other hand, told Trump that, in his view, making such an agreement with Spirit could have negative political consequences. He told the president he agreed it might save jobs, but he voiced skepticism about what the government is going to get out of possibly having a stake in the business.

Duffy also said that a deal with Spirit could leave voters with a negative impression about the Trump administration trying to bail out a failing company, a move that in the past hasn’t always been popular, the people said.

Such rescues have proved contentious, notably when large banks received a bailout during the 2008 financial crisis when George W. Bush was president.

Duffy made his views on a deal with Spirit known in a Reuters interview published on Tuesday. “What would someone buy?” Duffy said. “If no one else wants to buy them, why would we buy them?”

The administration official familiar with the matter noted that Duffy never told Trump that the administration shouldn’t go ahead with the deal but was pointing out possible downsides to an agreement.

The president earlier this week signaled his desire to aid Spirit and its employees.

“It’s 14,000 jobs, and maybe the federal government should help that one out,” Trump told CNBC in an interview on Tuesday morning.

“This is something the Commerce Department and the president are tracking,” White House press secretary Karoline Leavitt said Wednesday. “The aviation industry is very important to this president and this White House.”

Duffy comes from a part of the president’s Republican Party that may be skeptical of whether such a deal makes sense. He rose up the ranks of Congress during the tea party movement, which advocated for less government interference. Some lawmakers associated with the tea party rallied against the bailout of big banks as well as carmakers.

Republican senators on Wednesday also questioned the potential agreement with Spirit.

“The government doesn’t know a damn thing about running a failed budget airline,” Sen. Ted Cruz (R., Texas) said on X.

“If Spirit’s creditors or other potential investors don’t think they can run it profitably coming out of its second bankruptcy in under two years, I doubt the US Government can either,” said Sen. Tom Cotton (R., Ark.) on X. “Not the best use of taxpayer dollars.”

Write to Brian Schwartz at brian.schwartz@wsj.com