If Spirit can improve its image of "terrible service but cheap tickets" they could really hurt the competition (i.e. SWA)
There will always be a place for an airline that offers the cheapest tickets and can do it profitably, that's what built SW. Spirit has a lot of potential if they keep doing what they are doing. Rapid growth will keep the costs down, again, the same model SW used in it's heyday before it got too big to grow at double digit rates. Right now Spirit can enter most markets and set ticket prices at a level where they can be profitable and their competitors can not if they match the fares, that's a powerful competitive advantage.