DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2018 | Jan. 31, 2019 | Jun. 30, 2018 | |
Entity Information [Line Items] | |||
Entity Registrant Name | ALASKA AIR GROUP, INC. | ||
Entity Central Index Key | 766,421 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 123,123,710 | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 7.4 | ||
Document Period End Date | Dec. 31, 2018 | ||
Entity Shell Company | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Current Assets | ||
Cash and cash equivalents | $ 105 | $ 194 |
Marketable securities | 1,131 | 1,427 |
Total cash and marketable securities | 1,236 | 1,621 |
Receivables—less allowance for doubtful accounts of $1 and $1 | 366 | 341 |
Inventories and supplies—net | 60 | 57 |
Prepaid expenses and other current assets | 125 | 133 |
Total Current Assets | 1,787 | 2,152 |
Property and Equipment | ||
Aircraft and other flight equipment | 8,221 | 7,559 |
Other property and equipment | 1,363 | 1,222 |
Deposits for future flight equipment | 439 | 494 |
Property and Equipment | 10,023 | 9,275 |
Less accumulated depreciation and amortization | 3,242 | 2,991 |
Total Property and Equipment—Net | 6,781 | 6,284 |
Other Assets | ||
Goodwill | 1,943 | 1,943 |
Intangible assets—net | 127 | 133 |
Other noncurrent assets | 274 | 234 |
Total Other Assets | 2,344 | 2,310 |
Total Assets | 10,912 | 10,746 |
Current Liabilities | ||
Accounts payable | 132 | 120 |
Accrued wages, vacation and payroll taxes | 415 | 418 |
Air traffic liability | 788 | 806 |
Other accrued liabilities | 416 | 400 |
Current portion of long-term debt | 486 | 307 |
Deferred Revenue, Current | 705 | 635 |
Total Current Liabilities | 2,942 | 2,686 |
Long-Term Debt, Net of Current Portion | 1,617 | 2,262 |
Other Liabilities and Credits | ||
Deferred income taxes | 512 | 370 |
Deferred revenue | 1,169 | 1,090 |
Obligation for pension and postretirement medical benefits | 503 | 453 |
Other liabilities | 418 | 425 |
Total Other Liabilities and Credits | 2,602 | 2,338 |
Commitments and Contingencies | ||
Shareholders' Equity | ||
Preferred stock, $0.01 par value, Authorized: 5,000,000 shares, none issued or outstanding | 0 | 0 |
Common stock, $0.01 par value, Authorized: 400,000,000 shares, Issued: 2018 - 130,813,476 shares; 2017 - 129,903,498 shares, Outstanding: 2018 - 123,194,430 shares; 2017 - 123,060,638 shares | 1 | 1 |
Capital in excess of par value | 232 | 164 |
Treasury stock (common), at cost: 2018 - 7,619,046 shares; 2017 - 6,842,860 shares | (568) | (518) |
Accumulated other comprehensive loss | (448) | (380) |
Retained earnings | 4,534 | 4,193 |
Shareholders' Equity Total | 3,751 | 3,460 |
Total Liabilities and Shareholders' Equity | $ 10,912 | $ 10,746 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Allowance for doubtful accounts | $ 1 | $ 1 |
Shareholders' Equity: | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares issued | 130,813,476 | 129,903,498 |
Common stock, shares, outstanding | 123,194,430 | 123,060,638 |
Treasury stock, shares | 7,619,046 | 6,842,860 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Operating Revenues | |||
Total Operating Revenues | $ 8,264 | $ 7,894 | $ 5,925 |
Operating Expenses | |||
Wages and benefits | 2,190 | 1,931 | 1,394 |
Variable incentive pay | 147 | 135 | 127 |
Aircraft fuel, including hedging gains and losses | 1,936 | 1,447 | 831 |
Aircraft maintenance | 435 | 391 | 270 |
Aircraft rent | 315 | 274 | 114 |
Landing fees and other rentals | 499 | 460 | 320 |
Contracted services | 306 | 314 | 247 |
Selling expense | 326 | 368 | 248 |
Depreciation and amortization | 398 | 372 | 363 |
Cost of Services, Catering | 211 | 195 | 126 |
Third-party regional carrier expense | 154 | 121 | 95 |
Other operating expenses | 572 | 562 | 367 |
Special items - merger-related costs | 87 | 116 | 117 |
Special items—other | 45 | 0 | 0 |
Total Operating Expenses | 7,621 | 6,686 | 4,619 |
Operating Income | 643 | 1,208 | 1,306 |
Nonoperating Income (Expense) | |||
Interest income | 38 | 34 | 27 |
Interest expense | (91) | (103) | (55) |
Interest capitalized | 18 | 17 | 25 |
Other—net | (23) | 3 | 13 |
Nonoperating Income (Expense) Total | (58) | (49) | 10 |
Income before income tax | 585 | 1,159 | 1,316 |
Income Tax Expense, Before Tax Cuts and Jobs Act of 2017 | 148 | 436 | 502 |
Special tax expense (benefit) | 0 | (237) | 17 |
Income tax expense | 148 | 199 | 519 |
Net Income | $ 437 | $ 960 | $ 797 |
Basic earnings per share | $ 3.55 | $ 7.79 | $ 6.45 |
Diluted earnings per share | $ 3.52 | $ 7.75 | $ 6.41 |
Shares used for computation: | |||
Basic | 123,230 | 123,211 | 123,557 |
Diluted | 123,975 | 123,854 | 124,389 |
Cash dividend declared per share | $ 1.28 | $ 1.20 | $ 1.10 |
Passenger [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 7,301 | $ 5,392 | |
Mileage Plan Services, Other [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 434 | 418 | 370 |
Cargo and Freight [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 198 | 175 | 163 |
Passenger Revenue [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 7,632 | 7,301 | 5,392 |
Passenger Revenue [Member] | Passenger [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 7,632 | 7,301 | 5,392 |
Mileage Plan Revenue [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,053 | 959 | 813 |
Mileage Plan Revenue [Member] | Passenger [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 619 | 541 | 443 |
Mileage Plan Revenue [Member] | Mileage Plan Services, Other [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 434 | 418 | 370 |
Cargo and Other Revenue [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 198 | 175 | 163 |
Cargo and Other Revenue [Member] | Cargo and Freight [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 198 | $ 175 | $ 163 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATIONS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net Income | $ 437 | $ 960 | $ 797 |
Related to marketable securities: | |||
Unrealized holding gains (losses) arising during the period | (14) | (4) | 1 |
Reclassification of (gains) losses into Other-net nonoperating income (expense) | 8 | 1 | (1) |
Income tax benefit | 2 | 1 | 0 |
Marketable securities, net of tax | (4) | (2) | 0 |
Related to employee benefit plans: | |||
Actuarial losses related to pension and other postretirement benefit plans | (34) | (123) | (43) |
Reclassification of net pension expense into Wages and benefits and Other-net nonoperating income (expense) | 28 | 22 | 20 |
Income tax benefit | 2 | 24 | 12 |
Employee benefit plans, net of tax | (4) | (77) | (11) |
Related to interest rate derivative instruments: | |||
Unrealized holding gains (losses) arising during the period | 0 | 1 | 8 |
Reclassification of losses into Aircraft rent | 3 | 5 | 6 |
Income tax expense | (1) | (2) | (5) |
Interest rate derivative instruments, net of tax | 2 | 4 | 9 |
Other comprehensive income (loss) | (6) | (75) | (2) |
Comprehensive income | $ 431 | $ 885 | $ 795 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Millions | Total | Common Stock | Capital in Excess of Par Value | Treasury Stock, at Cost | Accumulated Other Comprehensive Loss | Retained Earnings |
Stockholders' Equity at Dec. 31, 2015 | $ 2,411 | $ 1 | $ 73 | $ (250) | $ (303) | $ 2,890 |
Common Stock Outstanding at Dec. 31, 2015 | 125,175,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 797 | 797 | ||||
Other comprehensive income (loss) | (2) | (2) | ||||
Common stock repurchase (in shares) | (2,595,000) | |||||
Common stock repurchase | (193) | 0 | (193) | |||
Stock-based compensation | 19 | 19 | ||||
Cash dividend declared | (136) | (136) | ||||
Stock issued for employee stock purchase plan (in shares) | 309,000 | |||||
Stock issued for employee stock purchase plan | 17 | 17 | ||||
Stock issued under stock plans (in shares) | 439,000 | |||||
Stock issued under stock plans | 1 | 1 | ||||
Stockholders' Equity at Dec. 31, 2016 | 2,744 | $ 1 | 110 | (443) | (305) | 3,381 |
Common Stock Outstanding at Dec. 31, 2016 | 123,328,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | 960 | 960 | ||||
Other comprehensive income (loss) | (75) | (75) | ||||
Common stock repurchase (in shares) | (981,000) | |||||
Common stock repurchase | (75) | 0 | (75) | |||
Stock-based compensation | 34 | 34 | ||||
Cash dividend declared | (148) | (148) | ||||
Stock issued for employee stock purchase plan (in shares) | 407,000 | |||||
Stock issued for employee stock purchase plan | 24 | 24 | ||||
Stock issued under stock plans (in shares) | 307,000 | |||||
Stock issued under stock plans | (4) | (4) | ||||
Stockholders' Equity at Dec. 31, 2017 | $ 3,460 | $ 1 | 164 | (518) | (380) | 4,193 |
Common Stock Outstanding at Dec. 31, 2017 | 123,060,638 | 123,061,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income | $ 437 | 437 | ||||
Other comprehensive income (loss) | (6) | (6) | ||||
Common stock repurchase (in shares) | (776,000) | |||||
Common stock repurchase | (50) | 0 | (50) | |||
Stock-based compensation | 36 | 36 | ||||
Cash dividend declared | (158) | (158) | ||||
Stock issued for employee stock purchase plan (in shares) | 632,000 | |||||
Stock issued for employee stock purchase plan | 35 | 35 | ||||
Stock issued under stock plans (in shares) | 277,000 | |||||
Stock issued under stock plans | (3) | (3) | ||||
Stockholders' Equity at Dec. 31, 2018 | $ 3,751 | $ 1 | $ 232 | $ (568) | $ (448) | $ 4,534 |
Common Stock Outstanding at Dec. 31, 2018 | 123,194,430 | 123,194,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net Income | $ 437 | $ 960 | $ 797 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 398 | 372 | 363 |
Stock-based compensation and other | 47 | 55 | 26 |
Changes in certain assets and liabilities: | |||
Changes in deferred tax provision | 146 | 45 | 82 |
(Increase) decrease in accounts receivable | (25) | (39) | (46) |
Increase (decrease) in air traffic liability | (18) | 45 | 3 |
Increase (decrease) in deferred revenue | 149 | 191 | 153 |
Changes in pension and other postretirement benefits | 52 | 17 | 23 |
Other—net | 9 | (56) | (15) |
Net cash provided by operating activities | 1,195 | 1,590 | 1,386 |
Property and equipment additions: | |||
Aircraft and aircraft purchase deposits | (686) | (804) | (528) |
Other flight equipment | (105) | (96) | (53) |
Other property and equipment | (169) | (126) | (97) |
Total property and equipment additions | (960) | (1,026) | (678) |
Acquisition of Virgin America, net of cash acquired | 0 | 0 | (1,951) |
Purchases of marketable securities | (834) | (1,569) | (960) |
Sales and maturities of marketable securities | 1,116 | 1,388 | 962 |
Proceeds from disposition of assets and changes in restricted deposits | 47 | 78 | 5 |
Net cash used in investing activities | (631) | (1,129) | (2,622) |
Cash flows from financing activities: | |||
Proceeds from issuance of long-term debt, net of issuance costs | 339 | 0 | 2,044 |
Long-term debt payments | (807) | (397) | (249) |
Common stock repurchases | (50) | (75) | (193) |
Cash dividend paid | (158) | (148) | (136) |
Other financing activities | 29 | 28 | 25 |
Net cash provided by (used in) financing activities | (647) | (592) | 1,491 |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (83) | (131) | 255 |
Cash, cash equivalents, and restricted cash at beginning of year | 197 | 328 | 73 |
Cash, cash equivalents, and restricted cash at end of year | 114 | 197 | 328 |
Cash paid during the year for: | |||
Interest, net of amount capitalized | 72 | 84 | 24 |
Income taxes, net of refunds received | $ 0 | $ 177 | $ 459 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Reconciliation of cash, cash equivalents, and restricted cash at end of the period | |||
Cash and cash equivalents | $ 105 | $ 194 | $ 328 |
Restricted Cash and Investments, Current | 9 | 3 | 0 |
Total cash, cash equivalents, and restricted cash at end of the period | $ 114 | $ 197 | $ 328 |
GENERAL AND SUMMARY OF SIGNIFIC
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Basis of Presentation The consolidated financial statements include the accounts of Air Group, or the Company, and its primary subsidiaries, Alaska (including Virgin America) and Horizon. Our consolidated financial statements also include McGee Air Services, a ground services subsidiary of Alaska. The Company conducts substantially all of its operations through these subsidiaries. All significant intercompany balances and transactions have been eliminated. These financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and their preparation requires the use of management’s estimates. Actual results may differ from these estimates. Certain reclassifications have been made to prior year financial statements to conform to classifications used in the current year. Cash and Cash Equivalents Cash equivalents consist of highly liquid investments with original maturities of three months or less, such as money market funds, commercial paper and certificates of deposit. They are carried at cost, which approximates market value. The Company reduces cash balances when funds are disbursed. Due to the time delay in funds clearing the banks, the Company normally maintains a negative balance in its cash disbursement accounts, which is reported as a current liability. The amount of the negative cash balance was $5 million and $10 million at December 31, 2018 and 2017 respectively, and is included in accounts payable, with the change in the balance during the year included in other financing activities in the consolidated statements of cash flows. The Company's restricted cash balances are not material and are classified as Other noncurrent assets. Restricted cash balances are primarily used to guarantee various letters of credit, self-insurance programs or other contractual rights. They consist of highly liquid securities with original maturities of three months or less. They are carried at cost, which approximates fair value. Marketable Securities Investments with original maturities of greater than three months and remaining maturities of less than one year are classified as short-term investments. Investments with maturities beyond one year may be classified as short-term based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. All cash equivalents and short-term investments are classified as available-for-sale and realized gains and losses are recorded using the specific identification method. Changes in market value, excluding other-than-temporary impairments, are reflected in accumulated other comprehensive loss (AOCL). Investments are considered to be impaired when a decline in fair value is judged to be other-than-temporary. The Company uses a systematic methodology that considers available quantitative and qualitative evidence in evaluating potential impairment. If the cost of an investment exceeds its fair value, management evaluates, among other factors, general market conditions, credit quality of debt instrument issuers, the duration and extent to which the fair value is less than cost, the Company's intent and ability to hold, or plans to sell, the investment. Once a decline in fair value is determined to be other-than-temporary, an impairment charge is recorded to Other—net in the consolidated statements of operations and a new cost basis in the investment is established. Inventories and Supplies—net Expendable aircraft parts, materials and supplies are stated at average cost and are included in Inventories and supplies — net. An obsolescence allowance for expendable parts is accrued based on estimated lives of the corresponding fleet type and salvage values. The allowance for expendable inventories was $39 million and $38 million at December 31, 2018 and 2017 , respectively. Inventory and supplies — net also includes fuel inventory of $24 million and $23 million at December 31, 2018 and 2017 , respectively. Repairable and rotable aircraft parts inventories are included in flight equipment. Property, Equipment and Depreciation Property and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives less an estimated salvage value, which are as follows: Estimated Useful Life Estimated Salvage Value Aircraft and other flight equipment: Boeing 737, Airbus A319/320, and E175 aircraft 20-25 years 10% Bombardier Q400 aircraft 15 years 5% Buildings 25 - 30 years 10% Minor building and land improvements 10 years —% Capitalized leases and leasehold improvements Generally shorter of lease term or estimated useful life —% Computer hardware and software 3-10 years —% Other furniture and equipment 5-10 years —% Near the end of an asset's estimated useful life, management updates the salvage value estimates based on current market conditions and expected use of the asset. Repairable and rotable aircraft parts are included in Aircraft and other flight equipment, and are depreciated over the associated fleet life. In 2016, the Company changed its accounting estimate for the expected useful life of the B737 NextGen aircraft, which includes the B737-700, -800, -900, -900ER aircraft and the related parts, from 20 years to 25 years. The change in estimate was precipitated by management's annual accounting policy review, which considered market studies, asset performance and intended use, as well as industry benchmarking. The change in estimate was applied prospectively effective October 1, 2016. Capitalized interest, based on the Company’s weighted-average borrowing rate, is added to the cost of the related asset, and is depreciated over the estimated useful life of the asset. Maintenance and repairs, other than engine maintenance on B737-800 engines, are expensed when incurred. Major modifications that extend the life or improve the usefulness of aircraft are capitalized and depreciated over their estimated period of use. Maintenance on B737-800 engines is covered under a power-by-the-hour agreement with a third party, whereby the Company pays a determinable amount, and transfers risk, to a third party. The Company expenses the contract amounts based on engine usage. The Company evaluates long-lived assets to be held and used for impairment whenever events or changes in circumstances indicate that the total carrying amount of an asset or asset group may not be recoverable. The Company groups assets for purposes of such reviews at the lowest level at which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities, which is generally the fleet level. An impairment loss is considered when estimated future undiscounted cash flows expected to result from the use of the asset or asset group and its eventual disposition are less than its carrying amount. If the asset or asset group is not considered recoverable, a write-down equal to the excess of the carrying amount over the fair value will be recorded. Goodwill Goodwill represents the excess of purchase price over the fair value of the related net assets acquired in the Company's acquisition of Virgin America and is not amortized. The total balance of goodwill is associated with the Mainline reporting unit. The Company reviews goodwill for impairment annually in Q4, or more frequently if events or circumstances indicate than an impairment may exist. If fair value of the reporting unit does not exceed the carrying amount, an impairment charge may be recorded. In 2018 , the fair value of the reporting unit with goodwill substantially exceeded its carrying value. Intangible Assets Intangible assets recorded in conjunction with the acquisition of Virgin America consist primarily of indefinite-lived airport slots, finite-lived airport gates and finite-lived customer relationships. Finite-lived intangibles are amortized over their estimated useful lives. Indefinite-lived intangibles are not amortized, but are tested at least annually for impairment using a similar methodology to property, equipment and goodwill, as described above. Operating Leases The Company leases aircraft, airport and terminal facilities, office space and other equipment under operating leases. Airport and terminal facility leases are variable based on volumes and expensed as incurred. Some of these lease agreements contain rent escalation clauses or rent holidays. For scheduled rent escalation clauses during the lease terms or for rental payments commencing at a date other than the date of initial occupancy, the Company records minimum rental expenses on a straight-line basis over the terms of the leases in the consolidated statements of operations. Leased Aircraft Return Costs Cash payments associated with returning leased aircraft are accrued when it is probable that a cash payment will be made and that amount is reasonably estimable, usually no sooner than after the last scheduled maintenance event prior to lease return. Any accrual is based on the time remaining on the lease, planned aircraft usage and the provisions included in the lease agreement, although the actual amount due to any lessor upon return may not be known with certainty until lease termination. As leased aircraft are returned, any payments are charged against the established accrual. The accrual is part of other current and long-term liabilities and was not material as of December 31, 2018 and December 31, 2017 . The expense is included in Aircraft maintenance in the consolidated statements of operations. Advertising Expenses The Company's advertising expenses include advertising and promotional costs. Advertising production costs are expensed as incurred. Advertising expense was $79 million , $91 million and $61 million during the years ended December 31, 2018 , 2017 and 2016 . Derivative Financial Instruments The Company's operations are significantly impacted by changes in aircraft fuel prices and interest rates. In an effort to manage exposure to these risks, the Company periodically enters into fuel and interest rate derivative instruments. These derivative instruments are recognized at fair value on the balance sheet and changes in the fair value are recognized in AOCL or in the consolidated statements of operations, depending on the nature of the instrument. The Company does not apply hedge accounting to its derivative fuel hedge contracts nor does it hold or issue them for trading purposes. For cash flow hedges related to interest rate swaps, the effective portion of the derivative represents the change in fair value of the hedge that offsets the change in fair value of the hedged item. To the extent the change in the fair value of the hedge does not perfectly offset the change in the fair value of the hedged item, the ineffective portion of the hedge is immediately recognized in interest expense. Fair Value Measurements Accounting standards define fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The standards also establish a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company has elected not to use the fair value option provided in the accounting standards for non-financial instruments. Accordingly, those assets and liabilities are carried at amortized cost. For financial instruments, the assets and liabilities are carried at fair value, which is determined based on the market approach or income approach, depending upon the level of inputs used. Assets and liabilities recognized or disclosed at fair value on a nonrecurring basis include items such as property, plant and equipment, goodwill, intangible assets and certain other assets and liabilities. The Company determines the fair value of these items using Level 3 inputs, as described in Note 5 . Income Taxes The Company uses the asset and liability approach for accounting for and reporting income taxes. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, and their respective tax bases and for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance would be established, if necessary, for the amount of any tax benefits that, based on available evidence, are not expected to be realized. As of December 31, 2018 , there is a partial valuation allowance against net deferred tax assets. The Company accounts for unrecognized tax benefits in accordance with the applicable accounting standards. The Company has substantial federal and state net operating losses (NOLs) for income tax purposes as a result of the acquisition of Virgin America. The Company's ability to utilize Virgin America's NOLs is limited by previous “ownership changes,” as defined in Section 382 of the Internal Revenue Code and similar state provisions, and could be further limited if there is another ownership change. In general terms, an ownership change can occur whenever there is a collective shift in the ownership of a company by more than 50% by one or more “5% stockholders” within a three-year period. The occurrence of such a change generally limits the amount of NOL carryforwards a company could utilize in a given year to the aggregate fair market value of the company's common stock immediately prior to the ownership change, multiplied by the long-term tax-exempt interest rate in effect for the month of the ownership change. The acquisition constituted an ownership change and the potential for further limitations following the acquisition. See Note 7 to the consolidated financial statements for more discussion of the calculation. Stock-Based Compensation Accounting standards require companies to recognize as expense the fair value of stock options and other equity-based compensation issued to employees as of the grant date. These standards apply to all stock awards that the Company grants to employees as well as the Company’s Employee Stock Purchase Plan (ESPP), which features a look-back provision and allows employees to purchase stock at a 15% discount. All stock-based compensation expense is recorded in wages and benefits in the consolidated statements of operations. Earnings Per Share (EPS) Diluted EPS is calculated by dividing net income by the average common shares outstanding plus additional common shares that would have been outstanding assuming the exercise of in-the-money stock options and restricted stock units, using the treasury-stock method. In 2018 , 2017 , and 2016 , anti-dilutive stock options excluded from the calculation of EPS were not material. Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires lessees to recognize assets and liabilities for leases currently classified as operating leases. Under the new standard, a lessee will recognize a liability on the balance sheet representing the lease payments owed, and a right-of-use-asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election not to recognize lease assets and lease liabilities. In July 2018, the FASB issued ASU 2018-11, "Targeted Improvements - Leases (Topic 842)" which amended Topic 842 to provide companies an alternative transition method which would not require adjusting comparative period financial information. The Company plans to utilize this alternative transition method and will record a cumulative-effect adjustment to the opening balance of retained earnings upon adoption on January 1, 2019. The Company plans to elect certain practical expedients available under the new standard. For leases with a term of 12 months or less, the Company will make an accounting policy election not to recognize lease assets and lease liabilities. Additionally the Company will elect the practical expedient to not separate lease and non-lease components for certain asset classes. Lastly, the Company will elect the package of practical expedients available under the standard that allows for no reassessment of expired contracts for leases, no reassessment of lease classification for existing leases, and no reassessment of initial direct costs for existing leases. The most significant impact to the financial statements from the new lease accounting standard is associated with aircraft. Although not significant, other leases including certain real estate, equipment, and software will be capitalized. The Company has operating leases for airport and terminal space, however these leases are not expected to have a significant impact on the balance sheet since variable lease payments are excluded from the measurement of the lease liability. At this time, the Company estimates the adoption of the standard will result in the recognition of lease assets and lease liabilities of approximately $1.75 billion to $1.85 billion . The new standard also eliminates prior build-to-suit lease accounting guidance. As a result, we will derecognize build-to-suit assets and liabilities that exist on the balance sheet of approximately $150 million each. The difference between the net assets and liabilities will be recorded as an adjustment to retained earnings and is not expected to be significant. The new standard will not result in more than a nominal impact on the pattern or amount of expense recognized on the statement of operations, statement of cash flows, nor on any existing debt covenants. The new standard will require significant new disclosures about our leasing activities. In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities." The ASU expands the activities that qualify for hedge accounting and simplifies the rules for reporting hedging relationships. The ASU is effective for the Company beginning January 1, 2019. |
RECENTLY ADOPTED ACCOUNTING PRO
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS (Notes) | 12 Months Ended |
Dec. 31, 2018 | |
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Revenue Recognition and Retirement Benefits Accounting Standards In May 2014, the FASB issued ASU 2014-09 , "Revenue from Contracts with Customers (Topic 606)." The Company adopted the new standard as of January 1, 2018, utilizing a full retrospective transition method. Adoption of the new standard resulted in changes to accounting policies for revenue recognition related to frequent flyer activity, certain ancillary revenues such as change fees, air traffic liabilities, and sales and marketing expenses. As a result of adoption, the Company also changed certain financial statement line item disclosure captions, which are outlined below. Although less significant, in March 2017 the FASB issued ASU 2017-07, "Compensation - Retirement Benefits (Topic 715)," which requires the Company to present the service cost component of net periodic benefit cost as Wages and benefits in the statement of operations. The Company adopted the new standard as of January 1, 2018, utilizing a full retrospective transition method. Under this new standard, all components of net periodic benefit cost are presented in Nonoperating income (expense), except service cost, which remains in Wages and benefits. Certain line item captions on the balance sheet and statement of operations changed as a result of the newly implemented standards. Accordingly, historical financial information presented below as reported has been presented using the new captions. The cumulative impact to retained earnings at January 1, 2016 as a result of the new revenue recognition standard was $170 million . Below are the impacts of these newly adopted accounting standards to the financial statements. Consolidated balance sheets as of December 31, 2017 (in millions): December 31, 2017 As Reported Adjustments - Revenue Recognition As Adjusted Current Assets: Prepaid expenses and other current assets $ 127 $ 6 $ 133 Current Liabilities: Air traffic liability (a) 937 (131 ) 806 Deferred revenue (b) 518 117 635 Other liabilities and credits: Deferred income taxes 454 (84 ) 370 Deferred revenue (b) 699 391 1,090 Other liabilities 451 (26 ) 425 Shareholders' Equity: Retained earnings 4,454 (261 ) 4,193 (a) Application of Topic 606 resulted in a decrease to our Air Traffic Liability as the standard requires earlier recognition of revenue for advance breakage. (b) Application of Topic 606 resulted in an increase to our Deferred Revenues as we are required to value flown miles at a relative fair value rather than at incremental cost. Consolidated statements of operations for the twelve months ended December 31, 2017 and December 31, 2016 (in millions): Twelve Months Ended December 31, 2017 Twelve Months Ended December 31, 2016 Adjustments Adjustments As Reported Revenue Recognition Retirement Benefits As Adjusted As Reported Revenue Recognition Retirement Benefits As Adjusted Operating Revenues Passenger revenue (a) $ 6,818 $ 483 $ — $ 7,301 $ 5,006 $ 386 $ — $ 5,392 Mileage Plan other revenue (a) 482 (64 ) — 418 429 (59 ) — 370 Cargo and other (a) 633 (458 ) — 175 496 (333 ) — 163 Total Operating Revenues 7,933 (39 ) — 7,894 5,931 (6 ) — 5,925 Operating Expenses Wages and benefits 1,924 — 7 1,931 1,382 — 12 1,394 Selling expense (b) 357 11 — 368 225 23 — 248 Special items—merger-related costs 118 (2 ) — 116 117 — — 117 All other operating expenses 4,271 — — 4,271 2,860 — — 2,860 Total Operating Expenses 6,670 9 7 6,686 4,584 23 12 4,619 Operating Income 1,263 (48 ) (7 ) 1,208 1,347 (29 ) (12 ) 1,306 Nonoperating Income (Expense) Other—net (4 ) — 7 3 1 — 12 13 All other nonoperating income (expense) (52 ) — — (52 ) (3 ) — — (3 ) (56 ) — 7 (49 ) (2 ) — 12 10 Income (loss) before income tax 1,207 (48 ) — 1,159 1,345 (29 ) — 1,316 Income tax expense (benefit) 173 26 — 199 531 (12 ) — 519 Net Income (Loss) $ 1,034 $ (74 ) $ — $ 960 $ 814 $ (17 ) $ — $ 797 (a) Application of Topic 606 resulted in a shift in certain ancillary revenues to Passenger revenue from Other Revenues. Additionally, the standard shifted the timing of the recognition of certain ancillary revenues from the time of sale to the time of travel. (b) Application of Topic 606 resulted in an increase to Selling expense as our methodology changed the timing of recognition of certain of our booking fees. Consolidated statements of cash flows for the twelve months ended December 31, 2017 and December 31, 2016 (in millions): Year Ended December 31, 2017 Year Ended December 31, 2016 As Reported Adjustments - Revenue Recognition (a) As Adjusted As Reported Adjustments - Revenue Recognition As Adjusted Cash flows from operating activities: Net income $ 1,034 $ (74 ) $ 960 $ 814 $ (17 ) $ 797 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 372 — 372 363 — 363 Stock-based compensation and other 55 — 55 26 — 26 Changes in certain assets and liabilities: Changes in deferred tax provision 19 26 45 94 (12 ) 82 Increase in accounts receivable (39 ) — (39 ) (46 ) — (46 ) Increase in air traffic liability 88 (43 ) 45 9 (6 ) 3 Increase in deferred revenue 63 128 191 83 70 153 Changes in pension and other postretirement benefits 17 — 17 23 — 23 Other—net (19 ) (37 ) (56 ) 20 (35 ) (15 ) Net cash provided by operating activities 1,590 — 1,590 1,386 — 1,386 Net cash used in investing activities (1,132 ) 3 (1,129 ) (2,622 ) — (2,622 ) Net cash provided by (used in) financing activities (592 ) — (592 ) 1,491 — 1,491 Net increase (decrease) in cash, cash equivalents and restricted cash (134 ) 3 (131 ) 255 — 255 Cash, cash equivalents and restricted cash at beginning of year 328 — 328 73 — 73 Cash, cash equivalents and restricted cash at end of the period $ 194 $ 3 $ 197 $ 328 $ — $ 328 (a) Also includes approximately $3 million in adjustments for the adoption of ASU 2016-18, which are reflected in the Other - net line item, as discussed further below. Other Standards Adopted In November 2016, the FASB issued ASU 2016-18, "Statement of Cash Flows—Restricted Cash (Topic 230)" related to the presentation of restricted cash on the statement of cash flows, and within the accompanying footnotes. The Company adopted the standard effective January 1, 2018. In February 2018, the FASB issued ASU 2018-02, "Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income." The standard allows a reclassification from accumulated other comprehensive income (AOCI) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The amount of the reclassification is the difference between the amount initially recorded directly to other comprehensive income at the previously enacted U.S. federal corporate income tax rate that remains in AOCI and the amount that would have been recorded directly to other comprehensive income using the newly enacted U.S. federal income tax rate. The standard is effective for interim and annual reporting periods beginning after December 15, 2018, and early adoption is permitted. The Company elected to early adopt the standard effective January 1, 2018. As a result, retained earnings increased approximately $62 million in 2018 due to the reclassification of tax effects in AOCI recorded in prior periods at previously enacted tax rates. |
REVENUE FROM CONTRACTS WITH CUS
REVENUE FROM CONTRACTS WITH CUSTOMERS (Notes) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contracts with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | REVENUE Ticket revenue is recorded as Passenger revenue, and represents the primary source of the Company's revenue. Also included in Passenger revenue are passenger ancillary revenues such as bag fees, on-board food and beverage, ticket change fees, and certain revenue from the frequent flyer program. Mileage Plan other revenue includes brand and marketing revenue from our co-branded credit card and other partners and certain interline frequent flyer revenue, net of commissions. Cargo and other revenue includes freight and mail revenue, and to a lesser extent, other ancillary revenue products such as lounge membership and certain commissions. The Company disaggregates revenue by segment in Note 13 . The level of detail within the Company’s statements of operations, segment disclosures, and in this footnote depict the nature, amount, timing and uncertainty of revenue and how cash flows are affected by economic and other factors. Passenger Ticket and Ancillary Services Revenue The primary performance obligation on a typical passenger ticket is to provide air travel to the passenger. Ticket revenue is collected in advance of travel and recorded as Air Traffic Liability (ATL) on the consolidated balance sheets. The Company satisfies its performance obligation and recognizes ticket revenue for each flight segment when the transportation is provided. Ancillary passenger revenues relate to items such as checked-bag fees, ticket change fees, and on-board food and beverage sales, all of which are provided at time of flight. As such, the obligation to perform these services is satisfied at the time of travel and is recorded with ticket revenue in Passenger revenue. Revenue is also recognized for tickets that are expected to expire unused, a concept referred to as “passenger ticket breakage.” Passenger ticket breakage is recorded at the flight date using estimates made at the time of sale based on the Company’s historical experience of expired tickets, and other facts such as program changes and modifications. In addition to selling tickets on its own marketed flights, Alaska has interline agreements with partner airlines under which it sells multi-city tickets with one or more segments of the trip flown by a partner airline, or it operates a connecting flight sold by a partner airline. Each segment in a connecting flight represents a separate performance obligation. Revenue on segments sold and operated by the Company is recognized as Passenger revenue in the gross amount of the allocated ticket price when the travel occurs, while the commission paid to the partner airline is recognized as a selling expense when the related transportation is provided. Revenue on segments operated by a partner airline is deferred for the full amount of the consideration received at the time the ticket is sold and, once the segment has been flown the Company records the net amount, after compensating the partner airline, as Cargo and other revenue. A portion of revenue from the Mileage Plan™ program is recorded in Passenger revenue. As members are awarded mileage credits on flown tickets, these credits become a distinct performance obligation to the Company. The Company allocates the transaction price to each performance obligation identified in a passenger ticket contract on a relative standalone selling price basis. The standalone selling price for loyalty mileage credits issued is discussed in the Loyalty Mileage Credits section of this Note below. The amount allocated to the mileage credits is deferred on the balance sheet. Once a member travels using a travel award redeemed with mileage credits on one of the Company's airline carriers, the revenue associated with those mileage credits is recorded as Passenger revenue. Taxes collected from passengers, including transportation excise taxes, airport and security fees and other fees, are recorded on a net basis within passenger revenue in the consolidated statements of operations. Passenger revenue recognized in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2018 2017 2016 Passenger ticket revenue, including ticket breakage and net of taxes and fees $ 6,483 $ 6,246 $ 4,568 Passenger ancillary revenue 530 514 381 Mileage Plan TM passenger revenue 619 541 443 Total passenger revenue $ 7,632 $ 7,301 $ 5,392 As passenger tickets and related ancillary services are primarily sold via credit cards, certain amounts due from credit card processors are recorded as airline traffic receivables. These credit card receivables and receivables from our affinity credit card partner represent the majority of the receivables balance on the consolidated balance sheets. For performance obligations with performance periods of less than one year, GAAP provides a practical expedient that allows the Company not to disclose the transaction price allocated to remaining performance obligations and the timing of related revenue recognition. As passenger tickets expire one year from ticketing, if unused or not exchanged, the Company elected to apply this practical expedient. Mileage Plan™ Loyalty Program Loyalty mileage credits The Company’s Mileage Plan™ loyalty program provides frequent flyer travel awards to program members based upon accumulated loyalty mileage credits. Mileage credits are earned through travel, purchases using the Mileage Plan™ co-branded credit card and purchases from other participating partners. The program has a 24 month expiration period for unused mileage credits from the month of last account activity. The Company offers redemption of mileage credits through free, discounted or upgraded air travel on flights operated by Alaska and its regional partners or on one of its 17 airline partners, as well as redemption at partner hotels. The Company uses a relative standalone selling price to allocate consideration to material performance obligations in contracts with customers that include loyalty mileage credits. As directly observable selling prices for mileage credits are not available, the Company determines the standalone selling price of mileage credits primarily using actual ticket purchase prices for similar tickets flown, adjusted for the likelihood of redemption, or breakage. In determining similar tickets flown, the Company considers current market prices, class of service, type of award, and other factors. For mileage credits accumulated through travel on partner airlines, the Company uses actual consideration received from the partners. Revenue related to air transportation is deferred in the amount of the relative standalone selling price allocated to the loyalty mileage credits as they are issued. The Company satisfies its performance obligation when the mileage credits are redeemed and the related air transportation is delivered. The Company estimates breakage for the portion of loyalty mileage credits not expected to be redeemed using a statistical analysis of historical data, including actual mileage credits expiring, slow-moving and low-credit accounts, among other factors. The breakage rate for the twelve months ended December 31, 2018 and 2017 was 17.4% . The Company reviews the breakage rate used on an annual basis. Co-brand credit card agreement and other In addition to mileage credits, the co-brand credit card agreement, referred to herein as the Agreement, also includes performance obligations for waived bag fees, Companion Fare™ offers to purchase an additional ticket at a discount, marketing, and the use of intellectual property including the brand (unlimited access to the use of the Company’s brand and frequent flyer member lists), which is the predominant element in the Agreement. The affinity card bank partner is the customer for some elements, including the brand and marketing, while the Mileage Plan™ member is the customer for other elements such as mileage credits, bag waivers, and companion fares. At the inception of the Agreement, management estimated the selling price of each of the performance obligations. The objective was to determine the price at which a sale would be transacted if the product or service was sold on a stand-alone basis. The Company determined its best estimate of selling price for each element by considering multiple inputs and methods including, but not limited to, the estimated selling price of comparable travel, discounted cash flows, brand value, published selling prices, number of miles awarded and number of miles redeemed. The Company estimated the selling prices and volumes over the term of the Agreement in order to determine the allocation of proceeds to each of the multiple deliverables. The estimates of the standalone selling prices of each element do not change subsequent to the original valuation of the contract unless the contract is materially modified, but the allocation between elements may change based upon the actual and updated projected volumes of each element delivered during the term of the contract. Consideration received from the bank is variable and is primarily from consumer spend on the card, among other items. The Company allocates consideration to each of the performance obligations, including mileage credits, waived bag fees, companion fares, and brand and marketing, using their relative standalone selling price. Because the performance obligation related to providing use of intellectual property including the brand is satisfied over time, it is recognized in Mileage Plan TM other revenue in the period that those elements are sold. The Company records passenger revenue related to the air transportation and certificates for discounted companion travel when the transportation is delivered. In contracts with non-bank partners, the Company has identified two performance obligations in most cases - travel and brand. Revenue is recognized using the residual method, where the travel performance obligation is deferred until transportation is provided in the amount of the estimated standalone selling price of the ticket, less breakage. The residual amount, if any, is recognized as commission revenue when the brand element is sold. Mileage credit sales recorded under the residual approach are immaterial to the overall program. Interline loyalty Alaska has interline arrangements with certain airlines whereby its members may earn and redeem Mileage Plan™ credits on those airlines, and members of a partner airline’s loyalty program may earn and redeem frequent flyer program credits on flights operated by Alaska and its regional partners. When a Mileage Plan™ member earns credits on a partner airline, the partner airline remits a contractually-agreed upon fee to the Company which is deferred until credits are redeemed. When a Mileage Plan™ member redeems credits on a partner airline, the Company pays a contractually agreed upon fee to the other airline, which offsets the revenue recognized associated with the award travel. When a member of a partner airline redeems frequent flyer credits on Alaska, the partner airline remits a contractually-agreed upon amount to the Company, recognized as Passenger revenue upon travel. If the partner airline’s member earns frequent flyer program credits on an Alaska flight, the Company remits a contractually-agreed upon fee to the partner airline and records a commission expense. Mileage Plan™ revenue included in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2018 2017 2016 Passenger revenue $ 619 $ 541 $ 443 Mileage Plan TM other revenue 434 418 370 Total Mileage Plan™ revenue $ 1,053 $ 959 $ 813 Mileage Plan™ other revenue is primarily brand and marketing revenue from our affinity card products. Cargo and Other The Company provides freight and mail services (cargo). The majority of cargo services are provided to commercial businesses and the United States Postal Service. The Company satisfies cargo service performance obligations and recognizes revenue when the shipment arrives at its final destination, or is transferred to a third-party carrier for delivery. The Company also earns other revenue for lounge memberships, hotel and car commissions, and certain other immaterial items not intrinsically tied to providing air travel to passengers. Revenue is recognized when these services are rendered and recorded as Cargo and other revenue. The transaction price for Cargo and other revenue is the price paid by the customer. Cargo and other revenue included in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2018 2017 2016 Cargo revenue $ 128 $ 115 $ 108 Other revenue 70 60 55 Total Cargo and other revenue $ 198 $ 175 $ 163 Air Traffic Liability and Deferred Revenue Passenger ticket and ancillary services liabilities Air traffic liability included on the consolidated balance sheets represents the remaining obligation associated with passenger tickets and ancillary services. The air traffic liability balance fluctuates with seasonal travel patterns. The Company recognized Passenger revenue of $583 million and $551 million from the 2017 and 2016 year-end air traffic liability balance for both the twelve months ended December 31, 2018 and 2017 , respectively. Mileage Plan TM liabilities The total deferred revenue liability included on the consolidated balance sheets represents the remaining transaction price that has been allocated to Mileage Plan TM performance obligations not yet satisfied by the Company. In general, the current amounts will be recognized as revenue within 12 months and the long-term amounts will be recognized as revenue over a period of approximately three to four years. This period of time represents the average time that members have historically taken to earn and redeem miles. The Company records a receivable for amounts due from the affinity card partner and from other partners as mileage credits are sold until the payments are collected. The Company had $119 million of such receivables as of December 31, 2018 and $101 million as of December 31, 2017 . Mileage credits are combined into one homogeneous pool and are not specifically identifiable. As such, loyalty revenues disclosed earlier in this Note are comprised of miles that were part of the deferred revenue and liabilities balances at the beginning of the period and miles that were issued during the period. The table below presents a roll forward of the total frequent flyer liability (in millions): Twelve Months Ended December 31, 2018 2017 Total Deferred Revenue balance at January 1 $ 1,725 $ 1,534 Travel miles and companion certificate redemption - Passenger revenue (619 ) (541 ) Miles redeemed on partner airlines - Other revenue (90 ) (73 ) Increase in liability for mileage credits issued 858 805 Total Deferred Revenue balance at December 31 $ 1,874 $ 1,725 Selling Costs Certain costs such as credit card fees, travel agency and other commissions paid, as well as Global Distribution Systems (GDS) booking fees are incurred when the Company sells passenger tickets and ancillary services in advance of the travel date. The Company defers such costs and recognizes them as expenses when the travel occurs. Prepaid expense recorded on the consolidated balance sheets for such costs was $23 million and $24 million as of December 31, 2018 and December 31, 2017 . The Company recorded related expense on the consolidated statement of operations of $217 million , $238 million and $173 million for the twelve months ended December 31, 2018 , 2017 and 2016 . |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS AND RISK MANAGEMENT Fuel Hedge Contracts The Company’s operations are inherently dependent upon the price and availability of aircraft fuel. To manage economic risks associated with fluctuations in aircraft fuel prices, the Company periodically enters into call options for crude oil. As of December 31, 2018 , the Company had outstanding fuel hedge contracts covering 421 million gallons of crude oil that will be settled from January 2019 to June 2020 . Interest Rate Swap Agreements The Company is exposed to market risk from adverse changes in variable interest rates on long-term debt and certain aircraft lease agreements. To manage this risk, the Company periodically enters into interest rate swap agreements. As of December 31, 2018 , the Company has outstanding interest rate swap agreements with a third party designed to hedge the volatility of the underlying variable interest rates on lease agreements for six B737-800 aircraft, as well as four interest rate swap agreements with third parties designed to hedge the volatility of the underlying variable interest rates on $382 million of debt. All of the interest rate swap agreements stipulate that the Company pay a fixed interest rate and receive a floating interest rate over the term of the underlying contracts. The interest rate swap agreements expire from February 2020 through March 2021 to coincide with the lease termination dates, and October 2022 through September 2026 to coincide with the debt maturity dates. All significant terms of the swap agreements match the terms of the underlying hedged items and have been designated as qualifying hedging instruments, which are accounted for as cash flow hedges. As qualifying cash flow hedges, the interest rate swaps are recognized at fair value on the balance sheet, and changes in the fair value are recognized in accumulated other comprehensive loss. The effective portion of the derivative represents the change in fair value of the hedge that offsets the change in fair value of the hedged item. To the extent the change in fair value of the hedge does not perfectly offset the change in the fair value of the hedged item, the ineffective portion of the hedge is recognized in interest expense, if material. Fair Values of Derivative Instruments Fair values of derivative instruments on the consolidated balance sheet (in millions): 2018 2017 Fuel hedge contracts (not designated as hedges) Prepaid expenses and other current assets $ 2 $ 19 Other assets 2 3 Interest rate swaps (designated as hedges) Prepaid expenses and other current assets 3 1 Other noncurrent assets 7 8 Other accrued liabilities (3 ) (3 ) Other liabilities (4 ) (5 ) Losses in accumulated other comprehensive loss (AOCL) (1 ) (2 ) The net cash paid for new fuel hedge positions and received from settlements was $21 million , $12 million and $19 million during 2018 , 2017 , and 2016 , respectively. Pretax effect of derivative instruments on earnings and AOCL (in millions): 2018 2017 2016 Fuel hedge contracts (not designated as hedges) Gains (losses) recognized in Aircraft fuel $ 1 $ (6 ) $ (3 ) Interest rate swaps (designated as hedges) Losses recognized in Aircraft rent (3 ) (5 ) (6 ) Gains recognized in other comprehensive income (OCI) — 1 8 The amounts shown as recognized in aircraft rent for cash flow hedges (interest rate swaps) represent the realized losses transferred out of AOCL to aircraft rent. No gains or losses related to interest rate swaps on variable rate debt have been recognized in interest expense during 2018 . The amounts shown as recognized in OCI are prior to the losses recognized in aircraft rent during the period. The Company expects $2 million to be reclassified from OCI to aircraft rent and $3 million to interest income within the next twelve months. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair Value of Financial Instruments on a Recurring Basis As of December 31, 2018 , the total cost basis for marketable securities was $1.1 billion . There were no significant differences between the cost basis and fair value of any individual class of marketable securities. Fair values of financial instruments on the consolidated balance sheet (in millions): December 31, 2018 December 31, 2017 Level 1 Level 2 Total Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 293 $ — $ 293 $ 328 $ — $ 328 Foreign government bonds — 26 26 — 43 43 Asset-backed securities — 190 190 — 209 209 Mortgage-backed securities — 92 92 — 99 99 Corporate notes and bonds — 520 520 — 726 726 Municipal securities — 10 10 — 22 22 Derivative instruments Fuel hedge contracts—call options — 4 4 — 22 22 Interest rate swap agreements — 10 10 — 9 9 Liabilities Derivative instruments Interest rate swap agreements — (7 ) (7 ) — (8 ) (8 ) The Company uses the market and income approach to determine the fair value of marketable securities. U.S. government securities are Level 1 as the fair value is based on quoted prices in active markets. The remaining marketable securities instruments are Level 2 as the fair value is based on standard valuation models that calculate values from observable inputs such as quoted interest rates, yield curves, credit ratings of the security and other observable market information. The Company uses the market and income approaches to determine the fair value of derivative instruments. The fair value for fuel hedge call options is determined utilizing an option pricing model that uses inputs that are readily available in active markets or can be derived from information available in active markets. In addition, the fair value considers exposure to credit losses in the event of non-performance by counterparties. Interest rate swap agreements are Level 2 as the fair value of these contracts is determined based on the difference between the fixed interest rate in the agreements and the observable LIBOR-based interest forward rates at period end, multiplied by the total notional value. Activity and Maturities for Marketable Securities Unrealized losses from marketable securities are primarily attributable to changes in interest rates. Management does not believe any remaining losses represent other-than-temporary impairments based on the Company's evaluation of available evidence as of December 31, 2018 . Proceeds from sales of marketable securities were $1.1 billion , $1.4 billion and $962 million in 2018 , 2017 , and 2016 . Maturities for marketable securities (in millions): December 31, 2018 Cost Basis Fair Value Due in one year or less $ 138 $ 138 Due after one year through five years 995 981 Due after five years through 10 years 12 12 Total $ 1,145 $ 1,131 Fair Value of Other Financial Instruments The Company used the following methods and assumptions to determine the fair value of financial instruments that are not recognized at fair value on the consolidated balance sheets. Cash and Cash Equivalents : Carried at amortized costs which approximate fair value. Debt : Debt assumed in the acquisition of Virgin America was subject to a non-recurring fair valuation adjustment as part of purchase price accounting. The adjustment is amortized over the life of the associated debt. All other fixed-rate debt is carried at cost. To estimate the fair value of all fixed-rate as of December 31, 2018 , the Company uses the income approach by discounting cash flows using borrowing rates for comparable debt over the weighted life of the outstanding debt. The estimated fair value of the fixed-rate debt is Level 3 as certain inputs used are unobservable. Fixed-rate debt on the consolidated balance sheet and the estimated fair value of long-term fixed-rate debt (in millions): December 31, 2018 December 31, 2017 Fixed rate debt at cost $ 639 $ 956 Non-recurring purchase price accounting fair value adjustment 3 3 Total fixed rate debt $ 642 $ 959 Estimated fair value $ 641 $ 959 |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt obligations (in millions): 2018 2017 Fixed-rate notes payable due through 2028 $ 642 $ 959 Variable-rate notes payable due through 2028 1,473 1,625 Less debt issuance costs (12 ) (15 ) Total debt 2,103 2,569 Less current portion 486 307 Long-term debt, less current portion $ 1,617 $ 2,262 Weighted-average fixed-interest rate 4.1 % 4.2 % Weighted-average variable-interest rate 3.9 % 2.8 % During 2018 , the Company's total debt decreased $466 million , primarily due to payments of $807 million in 2018 , including the prepayment of $451 million of debt. These reductions in debt were offset by the addition of secured debt financing from multiple lenders of $339 million . All outstanding debt is secured by aircraft, spare engines or by interest in certain aircraft purchase deposits. The Company's variable-rate debt bears interest at a floating rate per annum equal to a margin plus the three or six-month LIBOR in effect at the commencement of each three or six-month period, as applicable. As of December 31, 2018 , none of the Company's borrowings were restricted by financial covenants. Long-term debt principal payments for the next five years and thereafter (in millions): Total 2019 $ 488 2020 305 2021 263 2022 216 2023 262 Thereafter 579 Total principal payments $ 2,113 Subsequent to year end, the Company prepaid approximately $262 million of outstanding secured debt. This debt is classified as short-term in nature on our Consolidated Balance Sheet as of December 31, 2018. Also subsequent to year end, the Company obtained additional secured debt financing of $254 million from multiple lenders. The new debt is secured by a total of nine aircraft. Bank Line of Credit The Company has three credit facilities with availability totaling $516 million . All three facilities have variable interest rates based on LIBOR plus a specified margin. One credit facility for $250 million expires in June 2021 and is secured by aircraft. A second credit facility increased from $75 million to $116 million in July 2018 . It expires in July 2019 , with a mechanism for annual renewal, and is secured by aircraft. A third credit facility for $150 million expires in March 2022 and is secured by certain accounts receivable, spare engines, spare parts and ground service equipment. The Company has secured letters of credit against the $116 million facility, but has no plans to borrow using either of the two other facilities. All three credit facilities have a requirement to maintain a minimum unrestricted cash and marketable securities balance of $500 million . The Company was in compliance with this covenant at December 31, 2018 . |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Deferred Income Taxes Deferred income taxes reflect the impact of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and such amounts for tax purposes. The Company has a net deferred tax liability, primarily due to differences in depreciation rates for federal income tax purposes and for financial reporting purposes. Deferred tax (assets) and liabilities comprise the following (in millions): 2018 2017 Excess of tax over book depreciation $ 1,066 $ 964 Intangibles—net 15 14 Other—net 43 88 Deferred tax liabilities 1,124 1,066 Mileage Plan™ (315 ) (337 ) Inventory obsolescence (15 ) (16 ) Deferred gains (5 ) (5 ) Employee benefits (172 ) (154 ) Acquired net operating losses (64 ) (127 ) Other—net (43 ) (57 ) Deferred tax assets (614 ) (696 ) Valuation allowance 2 — Net deferred tax (assets) liabilities $ 512 $ 370 In 2018, the Company adopted the full retrospective method under ASC 606 "Revenue Contracts with Customers." The tax deferred assets and liabilities from 2017 were adjusted to reflect the retrospective adjustments of ASC 606. The retrospective adjustments increased other-net deferred tax liabilities $45 million and increased deferred tax assets $129 million , for a net deferred tax change of $84 million . At December 31, 2018 , the Company had federal NOLs of approximately $ 243 million that expire beginning in 2032 and continuing through 2036 , and state NOLs of approximately $ 189 million that expire beginning in 2029 and continuing through 2036 . Virgin America experienced multiple “ownership changes” as defined in Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), the most recent being its acquisition by the Company. Section 382 of the Code imposes an annual limitation on the utilization of pre-ownership change NOLs. Any unused annual limitation may, subject to certain limits, be carried over to later years. The combined Company’s ability to use the NOLs will also depend on the amount of taxable income generated in future periods. Valuation allowances are provided to reduce the related deferred income tax assets to an amount which will, more likely than not, be realized. The Company has determined it is more likely than not that a portion of the capital loss carryforward will not be realized and, therefore, has provided a valuation allowance of $2 million for that portion. The Company reassesses the need for a valuation allowance each reporting period. Components of Income Tax Expense The components of income tax expense were as follows (in millions): 2018 2017 2016 Current income tax expense: Federal $ (5 ) $ 127 $ 392 State 9 35 48 Total current income tax expense 4 162 440 Deferred income tax expense (benefit): Federal 125 (3 ) 67 State 19 40 12 Total deferred income tax expense (benefit) 144 37 79 Income tax expense $ 148 $ 199 $ 519 Income Tax Rate Reconciliation Income tax expense reconciles to the amount computed by applying the 2018 U.S. federal rate of 21% to income before income tax and for deferred taxes as follows (in millions): 2018 2017 2016 Income before income tax $ 585 $ 1,159 $ 1,316 Expected tax expense 123 406 461 Nondeductible expenses 9 5 20 State income taxes 21 28 27 State income sourcing — 9 12 Tax law changes (7 ) (237 ) — Other—net 2 (12 ) (1 ) Actual tax expense $ 148 $ 199 $ 519 Effective tax rate 25.3 % 17.2 % 39.4 % As a result of the ASC 606 full retrospective adoption, 2017 tax expense increased by $26 million and 2016 tax expense decreased by $12 million . As a result of tax changes signed into law during 2017, the Company recorded a deferred tax benefit of $237 million as a result of the reduction in future corporate income tax rate and other state law changes. The Company incurred $39 million of acquisition-related costs that are not deductible under U.S. federal tax law in 2016. These expenses are included in Special items—merger-related costs and other on the Company’s consolidated statement of operations and are reflected as a permanent unfavorable adjustment for the year ended December 31, 2016, in the table above. In 2017, adjustments were made to the Company's position on income sourcing in various states due to updated guidance from state taxing authorities. The impact of this guidance is reflected as an increase in income tax expense of approximately $9 million for the year ended December 31, 2017. Uncertain Tax Positions The Company has identified its federal tax return and its state tax returns in Alaska, Oregon and California as “major” tax jurisdictions. A summary of the Company's jurisdictions and the periods that are subject to examination are as follows: Jurisdiction Period Federal 2007 to 2017 Alaska 2012 to 2017 California 2007 to 2017 Oregon 2003 to 2017 Certain tax years are open to the extent of net operating loss carryforwards. Changes in the liability for gross unrecognized tax benefits during 2018 , 2017 and 2016 are as follows (in millions): 2018 2017 2016 Balance at January 1, $ 43 $ 40 $ 32 Additions related to prior years 1 16 — Releases related to prior years (4 ) (2 ) — Additions related to current year activity 2 2 — Additions from acquisitions — — 8 Releases due to settlements (1 ) (11 ) — Releases due to lapse of statute of limitations (1 ) (2 ) — Balance at December 31, $ 40 $ 43 $ 40 As of December 31, 2018 , the Company had $40 million of accrued tax contingencies, of which $33 million , if fully recognized, would decrease the effective tax rate. As of December 31, 2018 , 2017 and 2016 , the Company has accrued interest and penalties, net of federal income tax benefit, of $6 million , $5 million , and $3 million . In 2018 , 2017 , and 2016 , the Company recognized an expense of $1 million , $2 million , and $3 million for interest and penalties, net of federal income tax benefit. At December 31, 2018 , the Company has unrecognized tax benefits recorded as a liability. The Company reduced $3 million of reserves for uncertain tax positions in 2018 , primarily due to settlements on state incomes taxes and statute lapses on reserved amounts. These uncertain tax positions could change as a result of the Company's ongoing audits, settlement of issues, new audits and status of other taxpayer court cases. The Company cannot predict the timing of these actions. Due to the positions being taken in various jurisdictions, the amounts currently accrued are the Company's best estimate as of December 31, 2018 . |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Four qualified defined-benefit plans, one non-qualified defined-benefit plan, and seven defined-contribution retirement plans cover various employee groups of Alaska, Horizon and McGee Air Services. The defined-benefit plans provide benefits based on an employee’s term of service and average compensation for a specified period of time before retirement. The qualified defined-benefit pension plans are closed to new entrants. Accounting standards require recognition of the overfunded or underfunded status of an entity’s defined-benefit pension and other postretirement plan as an asset or liability in the consolidated financial statements and requires recognition of the funded status in AOCL. Qualified Defined-Benefit Pension Plans The Company’s four qualified defined-benefit pension plans are funded as required by the Employee Retirement Income Security Act of 1974. The defined-benefit plan assets consist primarily of marketable equity and fixed-income securities. The work groups covered by qualified defined-benefit pension plans include salaried employees, pilots, clerical, office, passenger service employees, mechanics and related craft employees. The Company uses a December 31 measurement date for these plans. All plans are closed to new entrants. Weighted average assumptions used to determine benefit obligations: The rates below vary by plan and related work group. 2018 2017 Discount rates 4.37% to 4.46% 3.69% to 3.78% Rate of compensation increases 2.11% to 3.50% 2.11% to 16.51% Weighted average assumptions used to determine net periodic benefit cost: The rates below vary by plan and related work group. 2018 2017 2016 Discount rates 3.69% to 3.78% 4.29% to 4.50% 4.55% to 4.69% Expected return on plan assets 4.25% to 5.50% 5.50% to 6.00% 6.00% to 6.50% Rate of compensation increases (a) 2.11% to 16.51% 2.12% to 2.59% 2.06% to 2.65% (a) Significant rate of compensation increase in 2018 is due to the new contract with our Mainline pilots, which was executed at the end of 2017. The discount rates are determined using current interest rates earned on high-quality, long-term bonds with maturities that correspond with the estimated cash distributions from the pension plans. At December 31, 2018 , the Company selected discount rates for each of the plans using a pool of higher-yielding bonds estimated to be more reflective of settlement rates, as management has taken steps to ultimately terminate or settle plans that are frozen and move toward freezing benefits in active plans in the future. In determining the expected return on plan assets, the Company assesses the current level of expected returns on risk-free investments (primarily government bonds), the historical level of the risk premium associated with the other asset classes in which the portfolio is invested and the expectations for future returns of each asset class. The expected return for each asset class is then weighted based on the target asset allocation to develop the expected long-term rate of return on assets assumption for the portfolio. Plan assets are invested in common commingled trust funds invested in equity and fixed income securities and in certain real estate assets. The target and actual asset allocation of the funds in the qualified defined-benefit plans, by asset category, are as follows: Salaried Plan (a) All other plans Target 2018 2017 Target 2018 2017 Asset category: Domestic equity securities 5% - 9% 6 % 8 % 25% - 33% 28 % 29 % Non-U.S. equity securities 1% - 5% 3 % 3 % 10% - 16% 12 % 12 % Fixed income securities 86% - 94% 91 % 89 % 48% - 58% 53 % 52 % Real estate — % — % — % 2% - 8% 7 % 6 % Cash equivalents — % — % — % — % — % 1 % Plan assets 100 % 100 % 100 % 100 % (a) As our Salaried Plan is frozen and fully funded, our investment strategies differ significantly from that of our other outstanding plans. Investments are in lower-risk securities, with earnings designed to match cash outflows. The Company’s investment policy focuses on achieving maximum returns at a reasonable risk for pension assets over a full market cycle. The Company determines the strategic allocation between equities, fixed income and real estate based on current funded status and other characteristics of the plans. As the funded status improves, the Company increases the fixed income allocation of the portfolio and decreases the equity allocation. Actual asset allocations are reviewed regularly and periodically rebalanced as appropriate. Plan assets invested in common commingled trust funds are fair valued using the net asset values of these funds to determine fair value as allowed using the practical expediency method outlined in the accounting standards. Fair value estimates for real estate are calculated using the present value of expected future cash flows based on independent appraisals, local market conditions and current and projected operating performance. Plan asset by fund category (in millions): 2018 2017 Fair Value Hierarchy Fund type: U.S. equity market fund $ 431 $ 515 1 Non-U.S. equity fund 183 226 1 Credit bond index fund 1,135 1,232 1 Plan assets in common commingled trusts $ 1,749 $ 1,973 Real estate 104 97 (a) Cash equivalents 5 13 1 Total plan assets $ 1,858 $ 2,083 (a) In accordance with Subtopic 820-10, certain investments that are measured at net asset value per share (or its equivalent) have not been classified in the fair value hierarchy. The following table sets forth the status of the qualified defined-benefit pension plans (in millions): 2018 2017 Projected benefit obligation (PBO) Beginning of year $ 2,387 $ 2,043 Service cost 48 39 Interest cost 79 74 Actuarial (gain)/loss (191 ) 300 Benefits paid (98 ) (69 ) End of year $ 2,225 $ 2,387 Plan assets at fair value Beginning of year $ 2,083 $ 1,846 Actual return on plan assets (127 ) 291 Employer contributions — 15 Benefits paid (98 ) (69 ) End of year $ 1,858 $ 2,083 Unfunded status $ (367 ) $ (304 ) Percent funded 84 % 87 % The accumulated benefit obligation for the combined qualified defined-benefit pension plans was $2.1 billion and $2.2 billion at December 31, 2018 and 2017 . The amounts recognized in the consolidated balance sheets (in millions): 2018 2017 Accrued benefit liability-long term $ 392 $ 335 Plan assets-long term (within Other noncurrent assets) (25 ) (31 ) Total liability recognized $ 367 $ 304 The amounts not yet reflected in net periodic benefit cost and included in AOCL (in millions): 2018 2017 Prior service credit $ (8 ) $ (9 ) Net loss 607 597 Amount recognized in AOCL (pretax) $ 599 $ 588 The expected amortization of prior service credit and net loss from AOCL in 2019 is $1 million and $37 million , respectively, for the qualified defined-benefit pension plans. Net pension expense for the qualified defined-benefit plans included the following components (in millions): 2018 2017 2016 Service cost $ 48 $ 39 $ 37 Interest cost 79 74 73 Expected return on assets (107 ) (106 ) (108 ) Amortization of prior service credit (1 ) (1 ) (1 ) Recognized actuarial loss 33 26 25 Net pension expense $ 52 $ 32 $ 26 There are no current statutory funding requirements for the Company’s plans in 2019 . Future benefits expected to be paid over the next ten years under the qualified defined-benefit pension plans from the assets of those plans (in millions): Total 2019 $ 99 2020 113 2021 115 2022 129 2023 132 2024– 2028 741 Nonqualified Defined-Benefit Pension Plan Alaska also maintains an unfunded, noncontributory defined-benefit plan for certain elected officers. This plan uses a December 31 measurement date. The assumptions used to determine benefit obligations and the net period benefit cost for the nonqualified defined-benefit pension plan are similar to those used to calculate the qualified defined-benefit pension plan. The plan's unfunded status, PBO and accumulated benefit obligation are immaterial. The net pension expense in prior year and expected future expense is also immaterial. Post-retirement Medical Benefits The Company allows certain retirees to continue their medical, dental and vision benefits by paying all or a portion of the active employee plan premium until eligible for Medicare, currently age 65. This results in a subsidy to retirees, because the premiums received by the Company are less than the actual cost of the retirees’ claims. The accumulated post-retirement benefit obligation for this subsidy is unfunded. The accumulated post-retirement benefit obligation was $82 million and $85 million at December 31, 2018 and 2017 , respectively. The net periodic benefit cost was not material in 2018 or 2017 . Defined-Contribution Plans The seven defined-contribution plans are deferred compensation plans under section 401(k) of the Internal Revenue Code. All of these plans require Company contributions. Total expense for the defined-contribution plans was $126 million , $103 million and $67 million in 2018 , 2017 , and 2016 , respectively. The Company also has a noncontributory, unfunded defined-contribution plan for certain elected officers of the Company who are ineligible for the nonqualified defined-benefit pension plan. Amounts recorded as liabilities under the plan are not material to the consolidated balance sheets at December 31, 2018 and 2017 . Pilot Long-term Disability Benefits Alaska maintains a long-term disability plan for its pilots. The long-term disability plan does not have a service requirement. Therefore, the liability is calculated based on estimated future benefit payments associated with pilots that were assumed to be disabled on a long-term basis as of December 31, 2018 and does not include any assumptions for future disability. The liability includes the discounted expected future benefit payments and medical costs. The total liability was $25 million and $28 million , which was recorded net of a prefunded trust account of $3 million and $3 million , and included in long-term other liabilities on the consolidated balance sheets as of December 31, 2018 and December 31, 2017 , respectively. Employee Incentive-Pay Plans The Company has employee incentive plans that pay employees based on certain financial and operational metrics. These metrics are set and approved annually by the Compensation Committee of the Board of Directors. The aggregate expense under these plans in 2018 , 2017 and 2016 was $147 million , $135 million and $127 million . The incentive plans are summarized below. • Performance-Based Pay (PBP) is a program that rewards the majority of Alaska and Horizon employees. The program is based on various metrics that adjust periodically, including those related to Air Group profitability, safety, Mileage Plan™ and credit card growth, achievement of unit-cost goals and employee engagement as measured by customer satisfaction. • The Operational Performance Rewards Program entitles the majority of Alaska and Horizon employees to quarterly payouts of up to $300 per person if certain monthly operational and customer service objectives are met. In 2019, quarterly payout maximums per person have been increased to $450. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Future minimum payments for commitments as of December 31, 2018 (in millions): Aircraft Leases Facility Leases Aircraft Commitments (a) Capacity Purchase Agreements (b) Aircraft Maintenance Deposits 2019 $ 350 $ 133 $ 495 $ 138 $ 61 2020 320 124 517 145 65 2021 286 113 556 166 59 2022 262 94 307 174 48 2023 208 26 108 179 24 Thereafter 847 122 33 1,065 8 Total $ 2,273 $ 612 $ 2,016 $ 1,867 $ 265 (a) Includes non-cancelable contractual commitments for aircraft and engines, buyer furnished equipment, and aircraft maintenance and parts management. (b) Includes all non-aircraft lease costs associated with capacity purchase agreements. Lease Commitments Aircraft lease commitments include future obligations for the Company's operating airlines – Alaska and Horizon – as well as aircraft leases operated by third parties. At December 31, 2018 , the Company had lease contracts for 10 B737 aircraft, 61 Airbus aircraft, nine Bombardier Q400 aircraft, and 32 E175 aircraft with SkyWest Airlines, Inc. (SkyWest). The Company has an additional two scheduled lease deliveries of A321neo aircraft in 2019 , as well as three scheduled lease deliveries of E175 aircraft in 2021 to be operated by SkyWest. The Company does not intend to operate the three E175s currently scheduled for delivery in 2021, and is working to remove those aircraft from the capacity purchase agreement. All lease contracts have remaining non-cancelable lease terms ranging from 2019 to 2033 . The Company has the option to increase capacity flown by SkyWest with eight additional E175 aircraft with deliveries from 2021 to 2022 . Options to lease are not reflected in the commitments table above. Facility lease commitments primarily include airport and terminal facilities and building leases. Total rent expense for aircraft and facility leases was $619 million , $552 million and $315 million , in 2018 , 2017 and 2016 . Aircraft Purchase Commitments Aircraft purchase commitments include non-cancelable contractual commitments for aircrafts and engines. As of December 31, 2018 , the Company had commitments to purchase 36 B737 aircraft ( four B737 NextGen aircraft and 32 B737 MAX aircraft, with deliveries in 2019 through 2023 ) and seven E175 aircraft with deliveries in 2019 and 2021 . The Company also has cancelable purchase commitments for 30 Airbus A320neo aircraft with deliveries from 2022 through 2024 . In addition, the Company has options to purchase 37 B737 aircraft and 30 E175 aircraft. The cancelable purchase commitments and option payments are not reflected in the table above. Aircraft Maintenance and Parts Management Through its acquisition of Virgin America, the Company has a separate maintenance-cost-per-hour contract for management and repair of certain rotable parts to support Airbus airframe and engine maintenance and repair. In 2017, Alaska entered into a similar contract for maintenance on its B737-800 aircraft engines. These agreements require monthly payments based upon utilization, such as flight hours, cycles and age of the aircraft, and, in turn, the agreement transfers certain risks to the third-party service provider. There are minimum payments under both agreements, which are reflected in the table above. Accordingly, payments could differ materially based on actual aircraft utilization. Capacity Purchase Agreements (CPAs) At December 31, 2018 , Alaska had CPAs with three carriers, including the Company's wholly-owned subsidiary, Horizon. Horizon sells 100% of its capacity under a CPA with Alaska. In addition, Alaska has CPAs with SkyWest to fly certain routes in the Lower 48 and Canada and with PenAir to fly certain routes in the state of Alaska. Under these agreements, Alaska pays the carriers an amount which is based on a determination of their cost of operating those flights and other factors intended to approximate market rates for those services. Future payments (excluding Horizon) are based on minimum levels of flying by the third-party carriers, which could differ materially due to variable payments based on actual levels of flying and certain costs associated with operating flights such as fuel. Aircraft Maintenance Deposits Certain Airbus leases include contractually required maintenance deposit payments to the lessor, which collateralize the lessor for future maintenance events should the Company not perform required maintenance. Most of the lease agreements provide that maintenance deposits are reimbursable upon completion of the major maintenance event in an amount equal to the lesser of (i) the amount qualified for reimbursement from maintenance deposits held by the lessor associated with the specific major maintenance event or (ii) the qualifying costs related to the specific major maintenance event. Contingencies The Company is a party to routine litigation matters incidental to its business and with respect to which no material liability is expected. Liabilities for litigation related contingencies are recorded when a loss is determined to be probable and estimable. In 2015, three flight attendants filed a class action lawsuit seeking to represent all California-based Virgin America flight attendants for damages based on alleged violations of California and City of San Francisco wage and hour laws. The court certified a class of approximately 1,800 flight attendants in November 2016. The Company believes the claims in this case are without factual and legal merit. In July 2018, the Court granted in part Plaintiffs' motion for summary judgment, finding Virgin America, and Alaska Airlines, as a successor-in-interest to Virgin America, responsible for various damages and penalties sought by the class members. On February 4, 2019, the Court entered final judgment against Virgin America and Alaska Airlines in the amount of approximately $78 million . It did not award behavioral relief from Alaska Airlines. The Company will then seek an appellate court ruling that the California laws on which the judgment is based are invalid as applied to national airlines pursuant to the U.S. Constitution and federal law and for other employment law and improper class certification reasons. The Company remains confident that a higher court will respect the federal preemption principles that were enacted to shield inter-state common carriers from a patchwork of state and local wage and hour regulations such as those at issue in this case and agree with the Company's other bases for appeal. For these reasons, no loss has been accrued. |
SHAREHOLDER'S EQUITY
SHAREHOLDER'S EQUITY | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
SHAREHOLDER'S EQUITY | SHAREHOLDERS' EQUITY Dividends During 2018 , the Board of Directors declared dividends of $1.28 per share. The Company paid dividends of $158 million , $148 million and $136 million to shareholders of record during 2018 , 2017 and 2016 . Subsequent to year-end, the Board of Directors declared a quarterly cash dividend of $0.35 per share to be paid in March 2019 to shareholders of record as of February 19, 2019. This is a 9% increase from the most recent quarterly dividend of $0.32 per share. Common Stock Repurchase In August 2015 , the Board of Directors authorized a $1 billion share repurchase program. As of December 31, 2018 , the Company has repurchased 6 million shares for $438 million under this program. At December 31, 2018 , the Company held 7,619,046 shares in treasury. Management does not anticipate retiring common shares held in treasury for the foreseeable future. Share repurchase activity (in millions, except shares): 2018 2017 2016 Shares Amount Shares Amount Shares Amount 2015 Repurchase Program – $1 billion 776,186 $ 50 981,277 $ 75 2,594,809 $ 193 Accumulated Other Comprehensive Loss (AOCL) AOCL consisted of the following (in millions, net of tax): 2018 2017 Related to marketable securities $ (11 ) $ (5 ) Related to employee benefit plans (440 ) (376 ) Related to interest rate derivatives 3 1 $ (448 ) $ (380 ) The Company adopted ASU 2018-02 in 2018. As a result, the Company reclassified approximately $62 million of tax effects in AOCL recorded in prior periods at previously enacted tax rates thus increasing Retained earnings. In relation to the Tax Cuts and Jobs Act, amounts recognized in other comprehensive income subsequent to the December 22, 2017 enactment date, are taxed at the revised federal income tax rates. The Company's actuarial adjustments for employee benefit plans occur annually at December 31, and therefore are tax effected at the new lower rates. Accordingly, the effective tax rate for employee benefit plan amounts recognized in other comprehensive income at December 31, 2017 was lower than it historically has been. |
SPECIAL ITEMS SPECIAL ITEMS
SPECIAL ITEMS SPECIAL ITEMS | 12 Months Ended |
Dec. 31, 2018 | |
SPECIAL ITEMS [Abstract] | |
Unusual or Infrequent Items Disclosure [Text Block] | SPECIAL ITEMS In 2018, the Company recognized special items of $87 million for merger-related costs associated with its acquisition of Virgin America. Costs classified as merger-related are directly attributable to merger activities. The Company incurred a one-time settlement fee of $20 million for the termination of an existing maintenance services agreement and subsequently entered into a new services agreement that provides more flexibility for the timing and scope of engine work. Additionally, the Company incurred $25 million for one-time bonuses paid to employees as a result of tax reform. These charges were recognized as special charges and are included in the Special charges - other line on our consolidated statements of operations. In 2017, the Company recognized $116 million in merger-related costs. The Company also recognized a special tax benefit of $237 million due to the remeasurement of net deferred tax liabilities as a result of the Tax Cuts and Jobs Act signed into law on December 22, 2017, partially offset by certain state tax law enactments. In 2016, the Company recognized $117 million in merger-related costs. $39 million of these costs were not deductible under the U.S. federal tax law, as discussed in Note 7 . The Company recognized a special tax expense of $17 million representing the discrete impacts of adjustments to the Company's position on income sourcing in various states. The following breaks down merger-related costs incurred in 2018 , 2017 and 2016 (in millions): 2018 2017 2016 Consulting and professional services $ 45 $ 52 $ 32 Employee-related costs (a) 13 41 22 Banking fees — — 36 Legal and accounting fees 1 3 22 Other merger-related costs (b) 28 20 5 Total Merger-related Costs $ 87 $ 116 $ 117 (a) Employee-related costs consist primarily of severance, retention bonuses, and training and skill development. (b) Other merger-related costs consist primarily of costs for marketing and advertising, IT, employee appreciation and company sponsored events, moving expenses, supplies, and other immaterial expenses. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION PLANS | STOCK-BASED COMPENSATION PLANS The Company has various equity incentive plans under which it may grant stock awards to directors, officers and employees. The Company also has an employee stock purchase plan. The table below summarizes the components of total stock-based compensation (in millions): 2018 2017 2016 Stock options $ 3 $ 3 $ 2 Stock awards 23 24 11 Deferred stock awards 1 1 1 Employee stock purchase plan 9 6 5 Stock-based compensation $ 36 $ 34 $ 19 Tax benefit related to stock-based compensation $ 9 $ 13 $ 7 Unrecognized stock-based compensation for non-vested options and awards and the weighted-average period the expense will be recognized (in millions): Amount Weighted-Average Period Stock options $ 3 1.4 Stock awards 26 1.6 Unrecognized stock-based compensation $ 29 1.6 The Company is authorized to issue 17 million shares of common stock under these plans, of which 9,851,918 shares remain available for future grants of either options or stock awards as of December 31, 2018 . Stock Options Stock options to purchase common stock are granted at the fair market value of the stock on the date of grant. The stock options granted have terms of up to ten years. The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants: 2018 2017 2016 Expected volatility 30 % 51 % 51 % Expected term 6 years 6 years 6 years Risk-free interest rate 2.61 % 2.04 % 1.23 % Expected dividend yield 1.94 % 1.10 % 1.50 % Weighted-average grant date fair value per share $ 17.18 $ 41.19 $ 27.14 Estimated fair value of options granted (millions) $ 1 $ 4 $ 2 The expected market price volatility and expected term are based on historical results. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of the grant. The expected dividend yield is based on the estimated weighted average dividend yield over the expected term. The expected forfeiture rates are based on historical experience. The tables below summarize stock option activity for the year ended December 31, 2018 : Shares Weighted- Average Exercise Price Per Share Weighted- Average Contractual Life (Years) Aggregate Intrinsic Value (in millions) Outstanding, December 31, 2017 441,467 $ 52.34 6.0 $ 11 Granted 204,700 66.67 Exercised (40,848 ) 32.76 Canceled (6,937 ) 67.12 Forfeited or expired (25,140 ) 72.67 Outstanding, December 31, 2018 573,242 $ 57.78 6.6 $ 6 Exercisable, December 31, 2018 265,113 $ 41.47 4.5 $ 6 Vested or expected to vest, December 31, 2018 573,242 $ 57.78 6.6 $ 6 (in millions) 2018 2017 2016 Intrinsic value of option exercises $ 1 $ 6 $ 9 Cash received from stock option exercises 1 3 3 Tax benefit related to stock option exercises — 2 3 Fair value of options vested 2 3 3 Stock Awards Restricted Stock Units (RSUs) are awarded to eligible employees and entitle the grantee to receive shares of common stock at the end of the vest period. The fair value of the RSUs is based on the stock price on the date of grant. Generally, RSUs “cliff vest” after three years, or the period from the date of grant to the employee’s retirement eligibility, and expense is recognized accordingly. Performance Share Units (PSUs) are awarded to certain executives to receive shares of common stock if specific performance goals and market conditions are achieved. There are several tranches of PSUs which vest when performance goals and market conditions are met. The following table summarizes information about outstanding stock awards: Number of Units Weighted-Average Grant Date Fair Value Weighted- Average Contractual Life (Years) Aggregate Intrinsic Value (in millions) Non-vested, December 31, 2017 525,145 $ 85.47 1.6 $ 39 Granted 401,424 66.55 Vested (310,403 ) 73.33 Forfeited (104,353 ) 80.77 Non-vested, December 31, 2018 511,813 $ 78.75 1.5 $ 31 Deferred Stock Awards Deferred Stock Units (DSUs) are awarded to members of the Board of Directors as part of their retainers. The underlying common shares are issued upon retirement from the Board, but require no future service period. As a result, the entire intrinsic value of the awards is expensed on the date of grant. Employee Stock Purchase Plan The ESPP allows employees to purchase common stock at 85% of the stock price on the first day of the offering period or the specified purchase date, whichever is lower. Employees may contribute up to 10% of their base earnings during the offering period to purchase stock. Employees purchased 632,145 , 406,628 and 308,920 shares in 2018 , 2017 and 2016 under the ESPP. |
OPERATING SEGMENT INFORMATION
OPERATING SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Operating Segment Information | OPERATING SEGMENT INFORMATION Alaska Air Group has two operating airlines—Alaska (including Virgin America after the single operating certificate received in January 2018) and Horizon. Each is a regulated airline by the U.S. Department of Transportation’s Federal Aviation Administration. Alaska has CPAs for regional capacity with Horizon, as well as with third-party carriers SkyWest and PenAir, under which Alaska receives all passenger revenues. Under U.S. General Accepted Accounting Principles, operating segments are defined as components of a business for which there is discrete financial information that is regularly assessed by the Chief Operating Decision Maker (CODM) in making resource allocation decisions. Financial performance for the operating airlines and CPAs is managed and reviewed by the Company's CODM as part of three reportable operating segments: • Mainline - includes scheduled air transportation on Alaska's Boeing or Airbus jet aircraft for passengers and cargo throughout the U.S., and in parts of Canada, Mexico, and Costa Rica. • Regional - includes Horizon's and other third-party carriers’ scheduled air transportation for passengers across a shorter distance network within the U.S. under CPAs. This segment includes the actual revenues and expenses associated with regional flying, as well as an allocation of corporate overhead incurred by Air Group on behalf of the regional operations. • Horizon - includes the capacity sold to Alaska under CPA. Expenses include those typically borne by regional airlines such as crew costs, ownership costs and maintenance costs. The CODM makes resource allocation decisions for these reporting segments based on flight profitability data, aircraft type, route economics and other financial information. The "Consolidating and Other" column reflects parent company activity, McGee Air Services, consolidating entries and other immaterial business units of the company. The “Air Group Adjusted” column represents a non-GAAP measure that is used by the Company CODM to evaluate performance and allocate resources. Adjustments are further explained below in reconciling to consolidated GAAP results. Operating segment information is as follows (in millions): Year Ended December 31, 2018 Mainline Regional Horizon Consolidating & Other (b) Air Group Adjusted (c) Special Items (d) Consolidated Operating revenues Passenger revenues 6,475 1,157 — — 7,632 — 7,632 CPA revenues — — 508 (508 ) — — — Mileage Plan other revenue 397 37 — — 434 — 434 Cargo and other 191 3 4 — 198 — 198 Total operating revenues 7,063 1,197 512 (508 ) 8,264 — 8,264 Operating expenses Non-fuel operating expenses 4,577 1,024 465 (513 ) 5,553 132 5,685 Fuel expense 1,652 262 — — 1,914 22 1,936 Total operating expenses 6,229 1,286 465 (513 ) 7,467 154 7,621 Nonoperating income (expense) Interest income 53 — — (15 ) 38 — 38 Interest expense (82 ) — (22 ) 13 (91 ) — (91 ) Interest capitalized 16 — 2 — 18 — 18 Other (12 ) (11 ) — — (23 ) — (23 ) Total nonoperating expense (25 ) (11 ) (20 ) (2 ) (58 ) — (58 ) Income (loss) before income tax $ 809 $ (100 ) $ 27 $ 3 $ 739 $ (154 ) $ 585 Year Ended December 31, 2017 Mainline Regional Horizon Consolidating & Other (b) Air Group Adjusted (c) Special Items (d) Consolidated Operating revenues Passenger revenues 6,278 1,023 — — 7,301 — 7,301 CPA revenues — — 426 (426 ) — — — Mileage Plan other revenue 387 31 — — 418 — 418 Cargo and other 167 4 4 — 175 — 175 Total operating revenues 6,832 1,058 430 (426 ) 7,894 — 7,894 Operating expenses Non-fuel operating expenses 4,271 852 427 (427 ) 5,123 116 5,239 Fuel expense 1,282 172 — — 1,454 (7 ) 1,447 Total operating expenses 5,553 1,024 427 (427 ) 6,577 109 6,686 Nonoperating income (expense) Interest income 39 — — (5 ) 34 — 34 Interest expense (92 ) — (13 ) 2 (103 ) — (103 ) Interest capitalized 15 — 2 — 17 — 17 Other 3 — — — 3 — 3 Total nonoperating expense (35 ) — (11 ) (3 ) (49 ) — (49 ) Income (loss) before income tax $ 1,244 $ 34 $ (8 ) $ (2 ) $ 1,268 $ (109 ) $ 1,159 Year Ended December 31, 2016 Mainline (a) Regional Horizon Consolidating & Other (b) Air Group Adjusted (c) Special Items (d) Consolidated Operating revenues Passenger revenues 4,415 977 — — 5,392 — 5,392 CPA revenues — — 424 (424 ) — — — Mileage Plan other revenue 333 37 — — 370 — 370 Cargo and other 160 4 — (1 ) 163 — 163 Total operating revenues 4,908 1,018 424 (425 ) 5,925 — 5,925 Operating expenses Non-fuel operating expenses 2,919 769 407 (424 ) 3,671 117 3,788 Fuel expense 719 125 — — 844 (13 ) 831 Total operating expenses 3,638 894 407 (424 ) 4,515 104 4,619 Nonoperating income (expense) Interest income 26 — 1 — 27 — 27 Interest expense (42 ) — (9 ) (4 ) (55 ) — (55 ) Interest capitalized 20 — 1 4 25 — 25 Other 13 — — — 13 — 13 Total nonoperating income (expense) 17 — (7 ) — 10 — 10 Income (loss) before income tax $ 1,287 $ 124 $ 10 $ (1 ) $ 1,420 $ (104 ) $ 1,316 (a) As the acquisition of Virgin America closed on December 14, 2016, Mainline financial results, presented above include Virgin America only for the period from December 14, 2016 to December 31, 2016. Financial results also reflect the impacts of purchase accounting. (b) Includes consolidating entries, Parent Company, McGee Air Services, and other immaterial business units. (c) The Air Group Adjusted column represents the financial information that is reviewed by management to assess performance of operations and determine capital allocations and excludes certain income and charges. (d) Includes merger-related costs, mark-to-market fuel-hedge accounting adjustments, and other special items. 2018 2017 2016 Depreciation and amortization: Mainline $ 316 $ 308 $ 296 Horizon 82 64 67 Consolidated $ 398 $ 372 $ 363 Capital expenditures: Mainline $ 571 $ 734 $ 608 Horizon 389 292 70 Consolidated $ 960 $ 1,026 $ 678 Total assets at end of period: Mainline $ 16,853 $ 16,663 Horizon 1,229 929 Consolidating & Other (7,170 ) (6,846 ) Consolidated $ 10,912 $ 10,746 |
GENERAL AND SUMMARY OF SIGNIF_2
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Basis of Accounting, Policy [Policy Text Block] | Organization and Basis of Presentation The consolidated financial statements include the accounts of Air Group, or the Company, and its primary subsidiaries, Alaska (including Virgin America) and Horizon. Our consolidated financial statements also include McGee Air Services, a ground services subsidiary of Alaska. The Company conducts substantially all of its operations through these subsidiaries. All significant intercompany balances and transactions have been eliminated. These financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and their preparation requires the use of management’s estimates. Actual results may differ from these estimates. Certain reclassifications have been made to prior year financial statements to conform to classifications used in the current year. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents Cash equivalents consist of highly liquid investments with original maturities of three months or less, such as money market funds, commercial paper and certificates of deposit. They are carried at cost, which approximates market value. The Company reduces cash balances when funds are disbursed. Due to the time delay in funds clearing the banks, the Company normally maintains a negative balance in its cash disbursement accounts, which is reported as a current liability. The amount of the negative cash balance was $5 million and $10 million at December 31, 2018 and 2017 respectively, and is included in accounts payable, with the change in the balance during the year included in other financing activities in the consolidated statements of cash flows. The Company's restricted cash balances are not material and are classified as Other noncurrent assets. Restricted cash balances are primarily used to guarantee various letters of credit, self-insurance programs or other contractual rights. They consist of highly liquid securities with original maturities of three months or less. They are carried at cost, which approximates fair value. Marketable Secur |
Marketable Securities, Policy [Policy Text Block] | Marketable Securities Investments with original maturities of greater than three months and remaining maturities of less than one year are classified as short-term investments. Investments with maturities beyond one year may be classified as short-term based on their highly liquid nature and because such marketable securities represent the investment of cash that is available for current operations. All cash equivalents and short-term investments are classified as available-for-sale and realized gains and losses are recorded using the specific identification method. Changes in market value, excluding other-than-temporary impairments, are reflected in accumulated other comprehensive loss (AOCL). Investments are considered to be impaired when a decline in fair value is judged to be other-than-temporary. The Company uses a systematic methodology that considers available quantitative and qualitative evidence in evaluating potential impairment. If the cost of an investment exceeds its fair value, management evaluates, among other factors, general market conditions, credit quality of debt instrument issuers, the duration and extent to which the fair value is less than cost, the Company's intent and ability to hold, or plans to sell, the investment. Once a decline in fair value is determined to be other-than-temporary, an impairment charge is recorded to Other—net in the consolidated statements of operations and a new cost basis in the investment is established. |
Inventory, Policy [Policy Text Block] | Inventories and Supplies—net Expendable aircraft parts, materials and supplies are stated at average cost and are included in Inventories and supplies — net. An obsolescence allowance for expendable parts is accrued based on estimated lives of the corresponding fleet type and salvage values. The allowance for expendable inventories was $39 million and $38 million at December 31, 2018 and 2017 , respectively. Inventory and supplies — net also includes fuel inventory of $24 million and $23 million at December 31, 2018 and 2017 , respectively. Repairable and rotable aircraft parts inventories are included in flight equipment. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property, Equipment and Depreciation Property and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives less an estimated salvage value, which are as follows: Estimated Useful Life Estimated Salvage Value Aircraft and other flight equipment: Boeing 737, Airbus A319/320, and E175 aircraft 20-25 years 10% Bombardier Q400 aircraft 15 years 5% Buildings 25 - 30 years 10% Minor building and land improvements 10 years —% Capitalized leases and leasehold improvements Generally shorter of lease term or estimated useful life —% Computer hardware and software 3-10 years —% Other furniture and equipment 5-10 years —% Near the end of an asset's estimated useful life, management updates the salvage value estimates based on current market conditions and expected use of the asset. Repairable and rotable aircraft parts are included in Aircraft and other flight equipment, and are depreciated over the associated fleet life. In 2016, the Company changed its accounting estimate for the expected useful life of the B737 NextGen aircraft, which includes the B737-700, -800, -900, -900ER aircraft and the related parts, from 20 years to 25 years. The change in estimate was precipitated by management's annual accounting policy review, which considered market studies, asset performance and intended use, as well as industry benchmarking. The change in estimate was applied prospectively effective October 1, 2016. Capitalized interest, based on the Company’s weighted-average borrowing rate, is added to the cost of the related asset, and is depreciated over the estimated useful life of the asset. Maintenance and repairs, other than engine maintenance on B737-800 engines, are expensed when incurred. Major modifications that extend the life or improve the usefulness of aircraft are capitalized and depreciated over their estimated period of use. Maintenance on B737-800 engines is covered under a power-by-the-hour agreement with a third party, whereby the Company pays a determinable amount, and transfers risk, to a third party. The Company expenses the contract amounts based on engine usage. The Company evaluates long-lived assets to be held and used for impairment whenever events or changes in circumstances indicate that the total carrying amount of an asset or asset group may not be recoverable. The Company groups assets for purposes of such reviews at the lowest level at which identifiable cash flows are largely independent of the cash flows of other groups of assets and liabilities, which is generally the fleet level. An impairment loss is considered when estimated future undiscounted cash flows expected to result from the use of the asset or asset group and its eventual disposition are less than its carrying amount. If the asset or asset group is not considered recoverable, a write-down equal to the excess of the carrying amount over the fair value will be recorded. Goodwill Goodwill represents the ex |
Goodwill | Goodwill Goodwill represents the excess of purchase price over the fair value of the related net assets acquired in the Company's acquisition of Virgin America and is not amortized. The total balance of goodwill is associated with the Mainline reporting unit. The Company reviews goodwill for impairment annually in Q4, or more frequently if events or circumstances indicate than an impairment may exist. If fair value of the reporting unit does not exceed the carrying amount, an impairment charge may be recorded. In 2018 , the fair value of the reporting unit with goodwill substantially exceeded its carrying value. |
Intangible Assets | Intangible Assets Intangible assets recorded in conjunction with the acquisition of Virgin America consist primarily of indefinite-lived airport slots, finite-lived airport gates and finite-lived customer relationships. Finite-lived intangibles are amortized over their estimated useful lives. Indefinite-lived intangibles are not amortized, but are tested at least annually for impairment using a similar methodology to property, equipment and goodwill, as described above. |
Lessee, Leases [Policy Text Block] | Operating Leases The Company leases aircraft, airport and terminal facilities, office space and other equipment under operating leases. Airport and terminal facility leases are variable based on volumes and expensed as incurred. Some of these lease agreements contain rent escalation clauses or rent holidays. For scheduled rent escalation clauses during the lease terms or for rental payments commencing at a date other than the date of initial occupancy, the Company records minimum rental expenses on a straight-line basis over the terms of the leases in the consolidated statements of operations. |
Leased Aircraft Return Costs [Policy Text Block] | Leased Aircraft Return Costs Cash payments associated with returning leased aircraft are accrued when it is probable that a cash payment will be made and that amount is reasonably estimable, usually no sooner than after the last scheduled maintenance event prior to lease return. Any accrual is based on the time remaining on the lease, planned aircraft usage and the provisions included in the lease agreement, although the actual amount due to any lessor upon return may not be known with certainty until lease termination. As leased aircraft are returned, any payments are charged against the established accrual. The accrual is part of other current and long-term liabilities and was not material as of December 31, 2018 and December 31, 2017 . The expense is included in Aircraft maintenance in the consolidated statements of operations. |
Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block] | Advertising Expenses The Company's advertising expenses include advertising and promotional costs. Advertising production costs are expensed as incurred. Advertising expense was $79 million , $91 million and $61 million during the years ended December 31, 2018 , 2017 and 2016 . |
Derivatives, Policy [Policy Text Block] | Derivative Financial Instruments The Company's operations are significantly impacted by changes in aircraft fuel prices and interest rates. In an effort to manage exposure to these risks, the Company periodically enters into fuel and interest rate derivative instruments. These derivative instruments are recognized at fair value on the balance sheet and changes in the fair value are recognized in AOCL or in the consolidated statements of operations, depending on the nature of the instrument. The Company does not apply hedge accounting to its derivative fuel hedge contracts nor does it hold or issue them for trading purposes. For cash flow hedges related to interest rate swaps, the effective portion of the derivative represents the change in fair value of the hedge that offsets the change in fair value of the hedged item. To the extent the change in the fair value of the hedge does not perfectly offset the change in the fair value of the hedged item, the ineffective portion of the hedge is immediately recognized in interest expense. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value Measurements Accounting standards define fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The standards also establish a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company has elected not to use the fair value option provided in the accounting standards for non-financial instruments. Accordingly, those assets and liabilities are carried at amortized cost. For financial instruments, the assets and liabilities are carried at fair value, which is determined based on the market approach or income approach, depending upon the level of inputs used. Assets and liabilities recognized or disclosed at fair value on a nonrecurring basis include items such as property, plant and equipment, goodwill, intangible assets and certain other assets and liabilities. The Company determines the fair value of these items using Level 3 inputs, as described in Note 5 . |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company uses the asset and liability approach for accounting for and reporting income taxes. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, and their respective tax bases and for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance would be established, if necessary, for the amount of any tax benefits that, based on available evidence, are not expected to be realized. As of December 31, 2018 , there is a partial valuation allowance against net deferred tax assets. The Company accounts for unrecognized tax benefits in accordance with the applicable accounting standards. The Company has substantial federal and state net operating losses (NOLs) for income tax purposes as a result of the acquisition of Virgin America. The Company's ability to utilize Virgin America's NOLs is limited by previous “ownership changes,” as defined in Section 382 of the Internal Revenue Code and similar state provisions, and could be further limited if there is another ownership change. In general terms, an ownership change can occur whenever there is a collective shift in the ownership of a company by more than 50% by one or more “5% stockholders” within a three-year period. The occurrence of such a change generally limits the amount of NOL carryforwards a company could utilize in a given year to the aggregate fair market value of the company's common stock immediately prior to the ownership change, multiplied by the long-term tax-exempt interest rate in effect for the month of the ownership change. The acquisition constituted an ownership change and the potential for further limitations following the acquisition. See Note 7 to the consolidated financial statements for more discussion of the calculation. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation Accounting standards require companies to recognize as expense the fair value of stock options and other equity-based compensation issued to employees as of the grant date. These standards apply to all stock awards that the Company grants to employees as well as the Company’s Employee Stock Purchase Plan (ESPP), which features a look-back provision and allows employees to purchase stock at a 15% discount. All stock-based compensation expense is recorded in wages and benefits in the consolidated statements of operations. |
Earnings Per Share, Policy [Policy Text Block] | Earnings Per Share (EPS) Diluted EPS is calculated by dividing net income by the average common shares outstanding plus additional common shares that would have been outstanding assuming the exercise of in-the-money stock options and restricted stock units, using the treasury-stock method. In 2018 , 2017 , and 2016 , anti-dilutive stock options excluded from the calculation of EPS were not material. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)," which requires lessees to recognize assets and liabilities for leases currently classified as operating leases. Under the new standard, a lessee will recognize a liability on the balance sheet representing the lease payments owed, and a right-of-use-asset representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election not to recognize lease assets and lease liabilities. In July 2018, the FASB issued ASU 2018-11, "Targeted Improvements - Leases (Topic 842)" which amended Topic 842 to provide companies an alternative transition method which would not require adjusting comparative period financial information. The Company plans to utilize this alternative transition method and will record a cumulative-effect adjustment to the opening balance of retained earnings upon adoption on January 1, 2019. The Company plans to elect certain practical expedients available under the new standard. For leases with a term of 12 months or less, the Company will make an accounting policy election not to recognize lease assets and lease liabilities. Additionally the Company will elect the practical expedient to not separate lease and non-lease components for certain asset classes. Lastly, the Company will elect the package of practical expedients available under the standard that allows for no reassessment of expired contracts for leases, no reassessment of lease classification for existing leases, and no reassessment of initial direct costs for existing leases. The most significant impact to the financial statements from the new lease accounting standard is associated with aircraft. Although not significant, other leases including certain real estate, equipment, and software will be capitalized. The Company has operating leases for airport and terminal space, however these leases are not expected to have a significant impact on the balance sheet since variable lease payments are excluded from the measurement of the lease liability. At this time, the Company estimates the adoption of the standard will result in the recognition of lease assets and lease liabilities of approximately $1.75 billion to $1.85 billion . The new standard also eliminates prior build-to-suit lease accounting guidance. As a result, we will derecognize build-to-suit assets and liabilities that exist on the balance sheet of approximately $150 million each. The difference between the net assets and liabilities will be recorded as an adjustment to retained earnings and is not expected to be significant. The new standard will not result in more than a nominal impact on the pattern or amount of expense recognized on the statement of operations, statement of cash flows, nor on any existing debt covenants. The new standard will require significant new disclosures about our leasing activities. In August 2017, the FASB issued ASU 2017-12, "Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities." The ASU expands the activities that qualify for hedge accounting and simplifies the rules for reporting hedging relationships. The ASU is effective for the Company beginning January 1, 2019. |
GENERAL AND SUMMARY OF SIGNIF_3
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment are recorded at cost and depreciated using the straight-line method over their estimated useful lives less an estimated salvage value, which are as follows: Estimated Useful Life Estimated Salvage Value Aircraft and other flight equipment: Boeing 737, Airbus A319/320, and E175 aircraft 20-25 years 10% Bombardier Q400 aircraft 15 years 5% Buildings 25 - 30 years 10% Minor building and land improvements 10 years —% Capitalized leases and leasehold improvements Generally shorter of lease term or estimated useful life —% Computer hardware and software 3-10 years —% Other furniture and equipment 5-10 years —% |
RECENTLY ADOPTED ACCOUNTING P_2
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | Consolidated balance sheets as of December 31, 2017 (in millions): December 31, 2017 As Reported Adjustments - Revenue Recognition As Adjusted Current Assets: Prepaid expenses and other current assets $ 127 $ 6 $ 133 Current Liabilities: Air traffic liability (a) 937 (131 ) 806 Deferred revenue (b) 518 117 635 Other liabilities and credits: Deferred income taxes 454 (84 ) 370 Deferred revenue (b) 699 391 1,090 Other liabilities 451 (26 ) 425 Shareholders' Equity: Retained earnings 4,454 (261 ) 4,193 (a) Application of Topic 606 resulted in a decrease to our Air Traffic Liability as the standard requires earlier recognition of revenue for advance breakage. (b) Application of Topic 606 resulted in an increase to our Deferred Revenues as we are required to value flown miles at a relative fair value rather than at incremental cost. Consolidated statements of operations for the twelve months ended December 31, 2017 and December 31, 2016 (in millions): Twelve Months Ended December 31, 2017 Twelve Months Ended December 31, 2016 Adjustments Adjustments As Reported Revenue Recognition Retirement Benefits As Adjusted As Reported Revenue Recognition Retirement Benefits As Adjusted Operating Revenues Passenger revenue (a) $ 6,818 $ 483 $ — $ 7,301 $ 5,006 $ 386 $ — $ 5,392 Mileage Plan other revenue (a) 482 (64 ) — 418 429 (59 ) — 370 Cargo and other (a) 633 (458 ) — 175 496 (333 ) — 163 Total Operating Revenues 7,933 (39 ) — 7,894 5,931 (6 ) — 5,925 Operating Expenses Wages and benefits 1,924 — 7 1,931 1,382 — 12 1,394 Selling expense (b) 357 11 — 368 225 23 — 248 Special items—merger-related costs 118 (2 ) — 116 117 — — 117 All other operating expenses 4,271 — — 4,271 2,860 — — 2,860 Total Operating Expenses 6,670 9 7 6,686 4,584 23 12 4,619 Operating Income 1,263 (48 ) (7 ) 1,208 1,347 (29 ) (12 ) 1,306 Nonoperating Income (Expense) Other—net (4 ) — 7 3 1 — 12 13 All other nonoperating income (expense) (52 ) — — (52 ) (3 ) — — (3 ) (56 ) — 7 (49 ) (2 ) — 12 10 Income (loss) before income tax 1,207 (48 ) — 1,159 1,345 (29 ) — 1,316 Income tax expense (benefit) 173 26 — 199 531 (12 ) — 519 Net Income (Loss) $ 1,034 $ (74 ) $ — $ 960 $ 814 $ (17 ) $ — $ 797 (a) Application of Topic 606 resulted in a shift in certain ancillary revenues to Passenger revenue from Other Revenues. Additionally, the standard shifted the timing of the recognition of certain ancillary revenues from the time of sale to the time of travel. (b) Application of Topic 606 resulted in an increase to Selling expense as our methodology changed the timing of recognition of certain of our booking fees. Consolidated statements of cash flows for the twelve months ended December 31, 2017 and December 31, 2016 (in millions): Year Ended December 31, 2017 Year Ended December 31, 2016 As Reported Adjustments - Revenue Recognition (a) As Adjusted As Reported Adjustments - Revenue Recognition As Adjusted Cash flows from operating activities: Net income $ 1,034 $ (74 ) $ 960 $ 814 $ (17 ) $ 797 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 372 — 372 363 — 363 Stock-based compensation and other 55 — 55 26 — 26 Changes in certain assets and liabilities: Changes in deferred tax provision 19 26 45 94 (12 ) 82 Increase in accounts receivable (39 ) — (39 ) (46 ) — (46 ) Increase in air traffic liability 88 (43 ) 45 9 (6 ) 3 Increase in deferred revenue 63 128 191 83 70 153 Changes in pension and other postretirement benefits 17 — 17 23 — 23 Other—net (19 ) (37 ) (56 ) 20 (35 ) (15 ) Net cash provided by operating activities 1,590 — 1,590 1,386 — 1,386 Net cash used in investing activities (1,132 ) 3 (1,129 ) (2,622 ) — (2,622 ) Net cash provided by (used in) financing activities (592 ) — (592 ) 1,491 — 1,491 Net increase (decrease) in cash, cash equivalents and restricted cash (134 ) 3 (131 ) 255 — 255 Cash, cash equivalents and restricted cash at beginning of year 328 — 328 73 — 73 Cash, cash equivalents and restricted cash at end of the period $ 194 $ 3 $ 197 $ 328 $ — $ 328 (a) Also includes approximately $3 million in adjustments for the adoption of ASU 2016-18, which are reflected in the Other - net line item, as discussed further below. |
REVENUE FROM CONTRACTS WITH C_2
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contracts with Customer [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Passenger revenue recognized in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2018 2017 2016 Passenger ticket revenue, including ticket breakage and net of taxes and fees $ 6,483 $ 6,246 $ 4,568 Passenger ancillary revenue 530 514 381 Mileage Plan TM passenger revenue 619 541 443 Total passenger revenue $ 7,632 $ 7,301 $ 5,392 Mileage Plan™ revenue included in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2018 2017 2016 Passenger revenue $ 619 $ 541 $ 443 Mileage Plan TM other revenue 434 418 370 Total Mileage Plan™ revenue $ 1,053 $ 959 $ 813 Cargo and other revenue included in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2018 2017 2016 Cargo revenue $ 128 $ 115 $ 108 Other revenue 70 60 55 Total Cargo and other revenue $ 198 $ 175 $ 163 |
Contract with Customer, Asset and Liability [Table Text Block] | The table below presents a roll forward of the total frequent flyer liability (in millions): Twelve Months Ended December 31, 2018 2017 Total Deferred Revenue balance at January 1 $ 1,725 $ 1,534 Travel miles and companion certificate redemption - Passenger revenue (619 ) (541 ) Miles redeemed on partner airlines - Other revenue (90 ) (73 ) Increase in liability for mileage credits issued 858 805 Total Deferred Revenue balance at December 31 $ 1,874 $ 1,725 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] | Fair values of derivative instruments on the consolidated balance sheet (in millions): 2018 2017 Fuel hedge contracts (not designated as hedges) Prepaid expenses and other current assets $ 2 $ 19 Other assets 2 3 Interest rate swaps (designated as hedges) Prepaid expenses and other current assets 3 1 Other noncurrent assets 7 8 Other accrued liabilities (3 ) (3 ) Other liabilities (4 ) (5 ) Losses in accumulated other comprehensive loss (AOCL) (1 ) (2 ) |
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block] | Pretax effect of derivative instruments on earnings and AOCL (in millions): 2018 2017 2016 Fuel hedge contracts (not designated as hedges) Gains (losses) recognized in Aircraft fuel $ 1 $ (6 ) $ (3 ) Interest rate swaps (designated as hedges) Losses recognized in Aircraft rent (3 ) (5 ) (6 ) Gains recognized in other comprehensive income (OCI) — 1 8 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by Balance Sheet Grouping [Table Text Block] | Fixed-rate debt on the consolidated balance sheet and the estimated fair value of long-term fixed-rate debt (in millions): December 31, 2018 December 31, 2017 Fixed rate debt at cost $ 639 $ 956 Non-recurring purchase price accounting fair value adjustment 3 3 Total fixed rate debt $ 642 $ 959 Estimated fair value $ 641 $ 959 Fair values of financial instruments on the consolidated balance sheet (in millions): December 31, 2018 December 31, 2017 Level 1 Level 2 Total Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 293 $ — $ 293 $ 328 $ — $ 328 Foreign government bonds — 26 26 — 43 43 Asset-backed securities — 190 190 — 209 209 Mortgage-backed securities — 92 92 — 99 99 Corporate notes and bonds — 520 520 — 726 726 Municipal securities — 10 10 — 22 22 Derivative instruments Fuel hedge contracts—call options — 4 4 — 22 22 Interest rate swap agreements — 10 10 — 9 9 Liabilities Derivative instruments Interest rate swap agreements — (7 ) (7 ) — (8 ) (8 ) |
Schedule of Realized Gain (Loss) [Table Text Block] | Proceeds from sales of marketable securities were $1.1 billion , $1.4 billion and $962 million in 2018 , 2017 , and 2016 . |
Schedule of Debt Investment Maturities [Table Text Block] | Maturities for marketable securities (in millions): December 31, 2018 Cost Basis Fair Value Due in one year or less $ 138 $ 138 Due after one year through five years 995 981 Due after five years through 10 years 12 12 Total $ 1,145 $ 1,131 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | Long-term debt obligations (in millions): 2018 2017 Fixed-rate notes payable due through 2028 $ 642 $ 959 Variable-rate notes payable due through 2028 1,473 1,625 Less debt issuance costs (12 ) (15 ) Total debt 2,103 2,569 Less current portion 486 307 Long-term debt, less current portion $ 1,617 $ 2,262 Weighted-average fixed-interest rate 4.1 % 4.2 % Weighted-average variable-interest rate 3.9 % 2.8 % |
Schedule of Maturities of Long-term Debt [Table Text Block] | Long-term debt principal payments for the next five years and thereafter (in millions): Total 2019 $ 488 2020 305 2021 263 2022 216 2023 262 Thereafter 579 Total principal payments $ 2,113 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | Deferred tax (assets) and liabilities comprise the following (in millions): 2018 2017 Excess of tax over book depreciation $ 1,066 $ 964 Intangibles—net 15 14 Other—net 43 88 Deferred tax liabilities 1,124 1,066 Mileage Plan™ (315 ) (337 ) Inventory obsolescence (15 ) (16 ) Deferred gains (5 ) (5 ) Employee benefits (172 ) (154 ) Acquired net operating losses (64 ) (127 ) Other—net (43 ) (57 ) Deferred tax assets (614 ) (696 ) Valuation allowance 2 — Net deferred tax (assets) liabilities $ 512 $ 370 |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | The components of income tax expense were as follows (in millions): 2018 2017 2016 Current income tax expense: Federal $ (5 ) $ 127 $ 392 State 9 35 48 Total current income tax expense 4 162 440 Deferred income tax expense (benefit): Federal 125 (3 ) 67 State 19 40 12 Total deferred income tax expense (benefit) 144 37 79 Income tax expense $ 148 $ 199 $ 519 |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | 2018 2017 2016 Income before income tax $ 585 $ 1,159 $ 1,316 Expected tax expense 123 406 461 Nondeductible expenses 9 5 20 State income taxes 21 28 27 State income sourcing — 9 12 Tax law changes (7 ) (237 ) — Other—net 2 (12 ) (1 ) Actual tax expense $ 148 $ 199 $ 519 Effective tax rate 25.3 % 17.2 % 39.4 % |
Summary of Income Tax Contingencies [Table Text Block] | Certain tax years are open to the extent of net operating loss carryforwards. Changes in the liability for gross unrecognized tax benefits during 2018 , 2017 and 2016 are as follows (in milli The Company has identified its federal tax return and its state tax returns in Alaska, Oregon and California as “major” tax jurisdictions. A summary of the Company's jurisdictions and the periods that are subject to examination are as follows: Jurisdiction Period Federal 2007 to 2017 Alaska 2012 to 2017 California 2007 to 2017 Oregon 2003 to 2017 Certain tax years are open to the extent of net operating loss carryforwards. Changes in the liability for gross unrecognized tax benefits during 2018 , 2017 and 2016 are as follows (in millions): 2018 2017 2016 Balance at January 1, $ 43 $ 40 $ 32 Additions related to prior years 1 16 — Releases related to prior years (4 ) (2 ) — Additions related to current year activity 2 2 — Additions from acquisitions — — 8 Releases due to settlements (1 ) (11 ) — Releases due to lapse of statute of limitations (1 ) (2 ) — Balance at December 31, $ 40 $ 43 $ 40 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) - Qualified Defined Benefit [Member] | 12 Months Ended |
Dec. 31, 2018 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Schedule of Assumptions Used [Table Text Block] | Weighted average assumptions used to determine benefit obligations: The rates below vary by plan and related work group. 2018 2017 Discount rates 4.37% to 4.46% 3.69% to 3.78% Rate of compensation increases 2.11% to 3.50% 2.11% to 16.51% Weighted average assumptions used to determine net periodic benefit cost: The rates below vary by plan and related work group. 2018 2017 2016 Discount rates 3.69% to 3.78% 4.29% to 4.50% 4.55% to 4.69% Expected return on plan assets 4.25% to 5.50% 5.50% to 6.00% 6.00% to 6.50% Rate of compensation increases (a) 2.11% to 16.51% 2.12% to 2.59% 2.06% to 2.65% |
Schedule of Allocation of Plan Assets [Table Text Block] | Plan asset by fund category (in millions): 2018 2017 Fair Value Hierarchy Fund type: U.S. equity market fund $ 431 $ 515 1 Non-U.S. equity fund 183 226 1 Credit bond index fund 1,135 1,232 1 Plan assets in common commingled trusts $ 1,749 $ 1,973 Real estate 104 97 (a) Cash equivalents 5 13 1 Total plan assets $ 1,858 $ 2,083 (a) In accordance with Subtopic 820-10, certain investments that are measured at net asset value per share (or its equivalent) have not been classified in the fair value hierarchy. The target and actual asset allocation of the funds in the qualified defined-benefit plans, by asset category, are as follows: Salaried Plan (a) All other plans Target 2018 2017 Target 2018 2017 Asset category: Domestic equity securities 5% - 9% 6 % 8 % 25% - 33% 28 % 29 % Non-U.S. equity securities 1% - 5% 3 % 3 % 10% - 16% 12 % 12 % Fixed income securities 86% - 94% 91 % 89 % 48% - 58% 53 % 52 % Real estate — % — % — % 2% - 8% 7 % 6 % Cash equivalents — % — % — % — % — % 1 % Plan assets 100 % 100 % 100 % 100 % (a) As our Salaried Plan is frozen and fully funded, our investment strategies differ significantly from that of our other outstanding plans. Investments are in lower-risk securities, with earnings designed to match cash outflows. |
Schedule of Net Funded Status [Table Text Block] | The following table sets forth the status of the qualified defined-benefit pension plans (in millions): 2018 2017 Projected benefit obligation (PBO) Beginning of year $ 2,387 $ 2,043 Service cost 48 39 Interest cost 79 74 Actuarial (gain)/loss (191 ) 300 Benefits paid (98 ) (69 ) End of year $ 2,225 $ 2,387 Plan assets at fair value Beginning of year $ 2,083 $ 1,846 Actual return on plan assets (127 ) 291 Employer contributions — 15 Benefits paid (98 ) (69 ) End of year $ 1,858 $ 2,083 Unfunded status $ (367 ) $ (304 ) Percent funded 84 % 87 % |
Schedule of Amounts Recognized in Balance Sheet [Table Text Block] | The amounts recognized in the consolidated balance sheets (in millions): 2018 2017 Accrued benefit liability-long term $ 392 $ 335 Plan assets-long term (within Other noncurrent assets) (25 ) (31 ) Total liability recognized $ 367 $ 304 The amounts not yet reflected in net periodic benefit cost and included in AOCL (in millions): 2018 2017 Prior service credit $ (8 ) $ (9 ) Net loss 607 597 Amount recognized in AOCL (pretax) $ 599 $ 588 |
Schedule of Net Benefit Costs [Table Text Block] | Net pension expense for the qualified defined-benefit plans included the following components (in millions): 2018 2017 2016 Service cost $ 48 $ 39 $ 37 Interest cost 79 74 73 Expected return on assets (107 ) (106 ) (108 ) Amortization of prior service credit (1 ) (1 ) (1 ) Recognized actuarial loss 33 26 25 Net pension expense $ 52 $ 32 $ 26 |
Schedule of Expected Benefit Payments [Table Text Block] | Future benefits expected to be paid over the next ten years under the qualified defined-benefit pension plans from the assets of those plans (in millions): Total 2019 $ 99 2020 113 2021 115 2022 129 2023 132 2024– 2028 741 |
COMMITMENTS AND CONTINGENCIES C
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases and Unrecorded Unconditional Purchase Obligtaions [Table Text Block] | Future minimum payments for commitments as of December 31, 2018 (in millions): Aircraft Leases Facility Leases Aircraft Commitments (a) Capacity Purchase Agreements (b) Aircraft Maintenance Deposits 2019 $ 350 $ 133 $ 495 $ 138 $ 61 2020 320 124 517 145 65 2021 286 113 556 166 59 2022 262 94 307 174 48 2023 208 26 108 179 24 Thereafter 847 122 33 1,065 8 Total $ 2,273 $ 612 $ 2,016 $ 1,867 $ 265 |
SHAREHOLDER'S EQUITY (Tables)
SHAREHOLDER'S EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Schedule of Treasury Stock by Class [Table Text Block] | Share repurchase activity (in millions, except shares): 2018 2017 2016 Shares Amount Shares Amount Shares Amount 2015 Repurchase Program – $1 billion 776,186 $ 50 981,277 $ 75 2,594,809 $ 193 |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | AOCL consisted of the following (in millions, net of tax): 2018 2017 Related to marketable securities $ (11 ) $ (5 ) Related to employee benefit plans (440 ) (376 ) Related to interest rate derivatives 3 1 $ (448 ) $ (380 ) The Company adopted ASU 2018-02 in 2018. As a result, the Company reclassified approximately $62 million of tax effects in AOCL recorded in prior periods at previously enacted tax rates thus increasing Retained earnings. In relation to the Tax Cuts and Jobs Act, amounts recognized in other comprehensive income subsequent to the December 22, 2017 enactment date, are taxed at the revised federal income tax rates. The Company's actuarial adjustments for employee benefit plans occur annually at December 31, and therefore are tax effected at the new lower rates. Accordingly, the effective tax rate for employee benefit plan amounts recognized in other comprehensive income at December 31, 2017 was lower than it historically has been. |
SPECIAL ITEMS (Tables)
SPECIAL ITEMS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Unusual or Infrequent Items, or Both [Abstract] | |
Merger-related Costs [Table Text Block] | The following breaks down merger-related costs incurred in 2018 , 2017 and 2016 (in millions): 2018 2017 2016 Consulting and professional services $ 45 $ 52 $ 32 Employee-related costs (a) 13 41 22 Banking fees — — 36 Legal and accounting fees 1 3 22 Other merger-related costs (b) 28 20 5 Total Merger-related Costs $ 87 $ 116 $ 117 (a) Employee-related costs consist primarily of severance, retention bonuses, and training and skill development. (b) Other merger-related costs consist primarily of costs for marketing and advertising, IT, employee appreciation and company sponsored events, moving expenses, supplies, and other immaterial expenses. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan [Table Text Block] | The table below summarizes the components of total stock-based compensation (in millions): 2018 2017 2016 Stock options $ 3 $ 3 $ 2 Stock awards 23 24 11 Deferred stock awards 1 1 1 Employee stock purchase plan 9 6 5 Stock-based compensation $ 36 $ 34 $ 19 Tax benefit related to stock-based compensation $ 9 $ 13 $ 7 |
Schedule of Unrecognized Compensation Cost, Nonvested Awards [Table Text Block] | Unrecognized stock-based compensation for non-vested options and awards and the weighted-average period the expense will be recognized (in millions): Amount Weighted-Average Period Stock options $ 3 1.4 Stock awards 26 1.6 Unrecognized stock-based compensation $ 29 1.6 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants: 2018 2017 2016 Expected volatility 30 % 51 % 51 % Expected term 6 years 6 years 6 years Risk-free interest rate 2.61 % 2.04 % 1.23 % Expected dividend yield 1.94 % 1.10 % 1.50 % Weighted-average grant date fair value per share $ 17.18 $ 41.19 $ 27.14 Estimated fair value of options granted (millions) $ 1 $ 4 $ 2 |
Share-based Compensation, Stock Options, Activity [Table Text Block] | The tables below summarize stock option activity for the year ended December 31, 2018 : Shares Weighted- Average Exercise Price Per Share Weighted- Average Contractual Life (Years) Aggregate Intrinsic Value (in millions) Outstanding, December 31, 2017 441,467 $ 52.34 6.0 $ 11 Granted 204,700 66.67 Exercised (40,848 ) 32.76 Canceled (6,937 ) 67.12 Forfeited or expired (25,140 ) 72.67 Outstanding, December 31, 2018 573,242 $ 57.78 6.6 $ 6 Exercisable, December 31, 2018 265,113 $ 41.47 4.5 $ 6 Vested or expected to vest, December 31, 2018 573,242 $ 57.78 6.6 $ 6 (in millions) 2018 2017 2016 Intrinsic value of option exercises $ 1 $ 6 $ 9 Cash received from stock option exercises 1 3 3 Tax benefit related to stock option exercises — 2 3 Fair value of options vested 2 3 3 |
Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block] | The following table summarizes information about outstanding stock awards: Number of Units Weighted-Average Grant Date Fair Value Weighted- Average Contractual Life (Years) Aggregate Intrinsic Value (in millions) Non-vested, December 31, 2017 525,145 $ 85.47 1.6 $ 39 Granted 401,424 66.55 Vested (310,403 ) 73.33 Forfeited (104,353 ) 80.77 Non-vested, December 31, 2018 511,813 $ 78.75 1.5 $ 31 |
OPERATING SEGMENT INFORMATION (
OPERATING SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |
Schedule of Segment Reporting Information, by Segment | Operating segment information is as follows (in millions): Year Ended December 31, 2018 Mainline Regional Horizon Consolidating & Other (b) Air Group Adjusted (c) Special Items (d) Consolidated Operating revenues Passenger revenues 6,475 1,157 — — 7,632 — 7,632 CPA revenues — — 508 (508 ) — — — Mileage Plan other revenue 397 37 — — 434 — 434 Cargo and other 191 3 4 — 198 — 198 Total operating revenues 7,063 1,197 512 (508 ) 8,264 — 8,264 Operating expenses Non-fuel operating expenses 4,577 1,024 465 (513 ) 5,553 132 5,685 Fuel expense 1,652 262 — — 1,914 22 1,936 Total operating expenses 6,229 1,286 465 (513 ) 7,467 154 7,621 Nonoperating income (expense) Interest income 53 — — (15 ) 38 — 38 Interest expense (82 ) — (22 ) 13 (91 ) — (91 ) Interest capitalized 16 — 2 — 18 — 18 Other (12 ) (11 ) — — (23 ) — (23 ) Total nonoperating expense (25 ) (11 ) (20 ) (2 ) (58 ) — (58 ) Income (loss) before income tax $ 809 $ (100 ) $ 27 $ 3 $ 739 $ (154 ) $ 585 Year Ended December 31, 2017 Mainline Regional Horizon Consolidating & Other (b) Air Group Adjusted (c) Special Items (d) Consolidated Operating revenues Passenger revenues 6,278 1,023 — — 7,301 — 7,301 CPA revenues — — 426 (426 ) — — — Mileage Plan other revenue 387 31 — — 418 — 418 Cargo and other 167 4 4 — 175 — 175 Total operating revenues 6,832 1,058 430 (426 ) 7,894 — 7,894 Operating expenses Non-fuel operating expenses 4,271 852 427 (427 ) 5,123 116 5,239 Fuel expense 1,282 172 — — 1,454 (7 ) 1,447 Total operating expenses 5,553 1,024 427 (427 ) 6,577 109 6,686 Nonoperating income (expense) Interest income 39 — — (5 ) 34 — 34 Interest expense (92 ) — (13 ) 2 (103 ) — (103 ) Interest capitalized 15 — 2 — 17 — 17 Other 3 — — — 3 — 3 Total nonoperating expense (35 ) — (11 ) (3 ) (49 ) — (49 ) Income (loss) before income tax $ 1,244 $ 34 $ (8 ) $ (2 ) $ 1,268 $ (109 ) $ 1,159 Year Ended December 31, 2016 Mainline (a) Regional Horizon Consolidating & Other (b) Air Group Adjusted (c) Special Items (d) Consolidated Operating revenues Passenger revenues 4,415 977 — — 5,392 — 5,392 CPA revenues — — 424 (424 ) — — — Mileage Plan other revenue 333 37 — — 370 — 370 Cargo and other 160 4 — (1 ) 163 — 163 Total operating revenues 4,908 1,018 424 (425 ) 5,925 — 5,925 Operating expenses Non-fuel operating expenses 2,919 769 407 (424 ) 3,671 117 3,788 Fuel expense 719 125 — — 844 (13 ) 831 Total operating expenses 3,638 894 407 (424 ) 4,515 104 4,619 Nonoperating income (expense) Interest income 26 — 1 — 27 — 27 Interest expense (42 ) — (9 ) (4 ) (55 ) — (55 ) Interest capitalized 20 — 1 4 25 — 25 Other 13 — — — 13 — 13 Total nonoperating income (expense) 17 — (7 ) — 10 — 10 Income (loss) before income tax $ 1,287 $ 124 $ 10 $ (1 ) $ 1,420 $ (104 ) $ 1,316 (a) As the acquisition of Virgin America closed on December 14, 2016, Mainline financial results, presented above include Virgin America only for the period from December 14, 2016 to December 31, 2016. Financial results also reflect the impacts of purchase accounting. (b) Includes consolidating entries, Parent Company, McGee Air Services, and other immaterial business units. (c) The Air Group Adjusted column represents the financial information that is reviewed by management to assess performance of operations and determine capital allocations and excludes certain income and charges. (d) Includes merger-related costs, mark-to-market fuel-hedge accounting adjustments, and other special items. 2018 2017 2016 Depreciation and amortization: Mainline $ 316 $ 308 $ 296 Horizon 82 64 67 Consolidated $ 398 $ 372 $ 363 Capital expenditures: Mainline $ 571 $ 734 $ 608 Horizon 389 292 70 Consolidated $ 960 $ 1,026 $ 678 Total assets at end of period: Mainline $ 16,853 $ 16,663 Horizon 1,229 929 Consolidating & Other (7,170 ) (6,846 ) Consolidated $ 10,912 $ 10,746 |
GENERAL AND SUMMARY OF SIGNIF_4
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CASH AND CASH EQUIVALENTS (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||
Negative cash balance | $ 5 | $ 10 |
GENERAL AND SUMMARY OF SIGNIF_5
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - INVENTORIES AND SUPPLIES - NET (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Accounting Policies [Abstract] | ||
Allowance for all non-surplus expendable inventories | $ 39 | $ 38 |
Fuel inventory | $ 24 | $ 23 |
GENERAL AND SUMMARY OF SIGNIF_6
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - PROPERTY, EQUIPMENT AND DEPRECIATION (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 0.00% |
Buildings [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 25 years |
Buildings [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 30 years |
Minor building and land improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 10 years |
Property, Plant, and Equipment, Salvage Value, Percentage | 0.00% |
Leaseholds and Leasehold Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 0.00% |
Leaseholds and Leasehold Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 10.00% |
Computer hardware and software [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 0.00% |
Computer hardware and software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 3 years |
Computer hardware and software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 10 years |
Other furniture and equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 0.00% |
Other furniture and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Other furniture and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 10 years |
B737 | Aircraft [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 10.00% |
B737 | Aircraft [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 20 years |
B737 | Aircraft [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 25 years |
Airbus [Member] | Aircraft [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 10.00% |
Airbus [Member] | Aircraft [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 20 years |
Airbus [Member] | Aircraft [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 25 years |
E175 [Member] | Aircraft [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 10.00% |
E175 [Member] | Aircraft [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 20 years |
E175 [Member] | Aircraft [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 25 years |
Q400 [Member] | Aircraft [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 15 years |
Property, Plant, and Equipment, Salvage Value, Percentage | 10.00% |
GENERAL AND SUMMARY OF SIGNIF_7
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - ADVERTISING EXPENSES (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | |||
Advertising Expense | $ 79 | $ 91 | $ 61 |
GENERAL AND SUMMARY OF SIGNIF_8
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - STOCK-BASED COMPENSATION (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Employee stock purchase plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Share-based Compensation Arrangement by Share-based Payment Award, Discount from Market Price, Purchase Date | 15.00% |
GENERAL AND SUMMARY OF SIGNIF_9
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS (Details) - Accounting Standards Update 2016-02 [Member] $ in Millions | Jan. 01, 2019USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Derecognition of Build-to-suit Accounting | $ 150 |
Minimum [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 1,750 |
Maximum [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | $ 1,850 |
RECENTLY ADOPTED ACCOUNTING P_3
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Millions | Jan. 01, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Jan. 01, 2016 | Dec. 31, 2015 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Total Operating Revenues | $ 8,264 | $ 7,894 | $ 5,925 | ||||
Wages and benefits | 2,190 | 1,931 | 1,394 | ||||
Prepaid expenses and other current assets | 125 | 133 | |||||
Air traffic liability | 788 | 806 | |||||
Deferred Revenue, Current | 705 | 635 | |||||
Deferred income taxes | 512 | 370 | |||||
Deferred revenue | 1,169 | 1,090 | |||||
Other liabilities | 418 | 425 | |||||
Retained earnings | 4,534 | 4,193 | |||||
Selling expense | 326 | 368 | 248 | ||||
Special items - merger-related costs | 87 | 116 | 117 | ||||
Operating Expenses, Other | 4,271 | 2,860 | |||||
Operating Expenses | 7,621 | 6,686 | 4,619 | ||||
Operating Income (Loss) | 643 | 1,208 | 1,306 | ||||
Other—net | (23) | 3 | 13 | ||||
Nonoperating Income (Expense), Other | (52) | (3) | |||||
Nonoperating Income (Expense) Total | (58) | (49) | 10 | ||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 1,159 | 1,316 | |||||
Income Tax Expense (Benefit) | 148 | 199 | 519 | ||||
Net Income | 437 | 960 | 797 | ||||
Depreciation and amortization | 398 | 372 | 363 | ||||
Stock-based compensation and other | 47 | 55 | 26 | ||||
Increase (Decrease) in Deferred Income Taxes | 146 | 45 | 82 | ||||
(Increase) decrease in accounts receivable | (25) | (39) | (46) | ||||
Increase (decrease) in air traffic liability | (18) | 45 | 3 | ||||
Increase (decrease) in deferred revenue | 149 | 191 | 153 | ||||
Increase (Decrease) in Obligation, Pension and Other Postretirement Benefits | 17 | 23 | |||||
Other—net | 9 | (56) | (15) | ||||
Net Cash Provided by (Used in) Operating Activities | 1,195 | 1,590 | 1,386 | ||||
Net Cash Provided by (Used in) Investing Activities | (631) | (1,129) | (2,622) | ||||
Net Cash Provided by (Used in) Financing Activities | (647) | (592) | 1,491 | ||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease) | (131) | 255 | |||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 114 | 197 | 328 | $ 73 | |||
Increase in retained earnings due to reclassification of tax effects in AOCI | [1] | $ (170) | |||||
Tax Cuts and Jobs Act, Reclassification from AOCI to Retained Earnings, Tax Effect | $ 0 | ||||||
Previously Reported [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Total Operating Revenues | 7,933 | 5,931 | |||||
Wages and benefits | 1,924 | 1,382 | |||||
Prepaid expenses and other current assets | 127 | ||||||
Air traffic liability | 937 | ||||||
Deferred Revenue, Current | 518 | ||||||
Deferred income taxes | 454 | ||||||
Deferred revenue | 699 | ||||||
Other liabilities | 451 | ||||||
Retained earnings | 4,454 | ||||||
Selling expense | 357 | 225 | |||||
Special items - merger-related costs | 118 | 117 | |||||
Operating Expenses, Other | 4,271 | 2,860 | |||||
Operating Expenses | 6,670 | 4,584 | |||||
Operating Income (Loss) | 1,263 | 1,347 | |||||
Other—net | (4) | 1 | |||||
Nonoperating Income (Expense), Other | (52) | (3) | |||||
Nonoperating Income (Expense) Total | (56) | (2) | |||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 1,207 | 1,345 | |||||
Income Tax Expense (Benefit) | 173 | 531 | |||||
Net Income | 1,034 | 814 | |||||
Depreciation and amortization | 372 | 363 | |||||
Stock-based compensation and other | 55 | 26 | |||||
Increase (Decrease) in Deferred Income Taxes | (19) | (94) | |||||
(Increase) decrease in accounts receivable | 39 | 46 | |||||
Increase (decrease) in air traffic liability | 88 | 9 | |||||
Increase (decrease) in deferred revenue | 63 | 83 | |||||
Increase (Decrease) in Obligation, Pension and Other Postretirement Benefits | 17 | 23 | |||||
Other—net | (19) | 20 | |||||
Net Cash Provided by (Used in) Operating Activities | 1,590 | 1,386 | |||||
Net Cash Provided by (Used in) Investing Activities | (1,132) | (2,622) | |||||
Net Cash Provided by (Used in) Financing Activities | (592) | 1,491 | |||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease) | (134) | 255 | |||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 194 | 328 | 73 | ||||
Accounting Standards Update 2016-18 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 3 | ||||||
Accounting Standards Update 2014-09 [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Increase in retained earnings due to reclassification of tax effects in AOCI | (170) | ||||||
Accounting Standards Update 2014-09 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Total Operating Revenues | (39) | (6) | |||||
Wages and benefits | 0 | 0 | |||||
Prepaid expenses and other current assets | 6 | ||||||
Air traffic liability | (131) | ||||||
Deferred Revenue, Current | 117 | ||||||
Deferred income taxes | (84) | ||||||
Deferred revenue | 391 | ||||||
Other liabilities | (26) | ||||||
Retained earnings | (261) | ||||||
Selling expense | 11 | 23 | |||||
Special items - merger-related costs | (2) | 0 | |||||
Operating Expenses, Other | 0 | 0 | |||||
Operating Expenses | 9 | 23 | |||||
Operating Income (Loss) | (48) | (29) | |||||
Other—net | 0 | 0 | |||||
Nonoperating Income (Expense), Other | 0 | 0 | |||||
Nonoperating Income (Expense) Total | 0 | 0 | |||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | (48) | (29) | |||||
Income Tax Expense (Benefit) | 26 | (12) | |||||
Net Income | (74) | (17) | |||||
Depreciation and amortization | 0 | 0 | |||||
Stock-based compensation and other | 0 | 0 | |||||
Increase (Decrease) in Deferred Income Taxes | (26) | 12 | |||||
(Increase) decrease in accounts receivable | 0 | 0 | |||||
Increase (decrease) in air traffic liability | (43) | (6) | |||||
Increase (decrease) in deferred revenue | 128 | 70 | |||||
Increase (Decrease) in Obligation, Pension and Other Postretirement Benefits | 0 | 0 | |||||
Other—net | (37) | (35) | |||||
Net Cash Provided by (Used in) Operating Activities | 0 | 0 | |||||
Net Cash Provided by (Used in) Investing Activities | 3 | 0 | |||||
Net Cash Provided by (Used in) Financing Activities | 0 | 0 | |||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease) | 3 | 0 | |||||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 3 | 0 | $ 0 | ||||
Accounting Standards Update 2017-07 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Total Operating Revenues | 0 | 0 | |||||
Wages and benefits | 7 | 12 | |||||
Selling expense | 0 | 0 | |||||
Special items - merger-related costs | 0 | 0 | |||||
Operating Expenses, Other | 0 | 0 | |||||
Operating Expenses | 7 | 12 | |||||
Operating Income (Loss) | (7) | (12) | |||||
Other—net | 7 | 12 | |||||
Nonoperating Income (Expense), Other | 0 | 0 | |||||
Nonoperating Income (Expense) Total | 7 | 12 | |||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 0 | 0 | |||||
Income Tax Expense (Benefit) | 0 | 0 | |||||
Net Income | 0 | 0 | |||||
Passenger [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 7,301 | 5,392 | |||||
Passenger [Member] | Previously Reported [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 6,818 | 5,006 | |||||
Passenger [Member] | Accounting Standards Update 2014-09 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 483 | 386 | |||||
Passenger [Member] | Accounting Standards Update 2017-07 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |||||
Mileage Plan Services, Other [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 434 | 418 | 370 | ||||
Mileage Plan Services, Other [Member] | Previously Reported [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 482 | 429 | |||||
Mileage Plan Services, Other [Member] | Accounting Standards Update 2014-09 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | (64) | (59) | |||||
Mileage Plan Services, Other [Member] | Accounting Standards Update 2017-07 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |||||
Cargo and Freight [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 198 | 175 | 163 | ||||
Cargo and Freight [Member] | Previously Reported [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 633 | 496 | |||||
Cargo and Freight [Member] | Accounting Standards Update 2014-09 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | (458) | (333) | |||||
Cargo and Freight [Member] | Accounting Standards Update 2017-07 [Member] | Restatement Adjustment [Member] | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | |||||
Retained Earnings | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Net Income | $ 437 | $ 960 | $ 797 | ||||
Increase in retained earnings due to reclassification of tax effects in AOCI | [1] | $ (170) | |||||
Tax Cuts and Jobs Act, Reclassification from AOCI to Retained Earnings, Tax Effect | 62 | ||||||
Accumulated Other Comprehensive Loss | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Tax Cuts and Jobs Act, Reclassification from AOCI to Retained Earnings, Tax Effect | $ (62) | ||||||
[1] | Represents the opening balance sheet adjustment recorded as a result of the adoption of the new revenue recognition standard. |
REVENUE FROM CONTRACTS WITH C_3
REVENUE FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cargo and Other Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 198 | $ 175 | $ 163 |
Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 7,632 | 7,301 | 5,392 |
Passenger [Member] | Cargo and Other Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 128 | 115 | 108 |
Passenger Tickets [Member] | Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 6,483 | 6,246 | 4,568 |
Passenger Ancillary Services [Member] | Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 530 | 514 | 381 |
Mileage Plan Services [Member] | Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 619 | 541 | 443 |
Mileage Plan Services, Other [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 434 | 418 | 370 |
Other Services [Member] | Cargo and Other Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 70 | $ 60 | $ 55 |
REVENUE FROM CONTRACTS WITH C_4
REVENUE FROM CONTRACTS WITH CUSTOMERS Contract Liabilities Activity (Details) - Mileage Plan Revenue [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Contract with Customer, Liability | $ 1,874 | $ 1,725 | $ 1,534 |
Contract with Customer, Liability, Increase From Issuance of Credits | 858 | 805 | |
Mileage Plan Services, Other [Member] | |||
Contract with Customer, Liability, Revenue Recognized | (90) | (73) | |
Passenger Services [Member] | |||
Contract with Customer, Liability, Revenue Recognized | $ (619) | $ (541) |
REVENUE FROM CONTRACTS WITH C_5
REVENUE FROM CONTRACTS WITH CUSTOMERS Narrative (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($)airline | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Deferred Revenue Arrangement [Line Items] | |||
Percent of Mileage Breakage | 17.40% | 17.40% | |
Contract cost recognized | $ 217 | $ 238 | $ 173 |
Receivable | $ 366 | 341 | |
Number of Partner AIrlines | airline | 17 | ||
Prepaid Expenses and Other Current Assets [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Capitalized Contract Cost, Net | $ 23 | 24 | |
Passenger Revenue [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Contract with Customer, Liability, Revenue Recognized | 583 | 551 | |
Mileage Plan Revenue [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Receivable | $ 119 | $ 101 |
DERIVATIVE INSTRUMENTS - BALANC
DERIVATIVE INSTRUMENTS - BALANCE SHEET CLASSIFICATION (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Derivatives, Fair Value [Line Items] | ||
Accumulated other comprehensive loss | $ (448) | $ (380) |
Fuel hedge contracts [Member] | Derivative Instruments Not Designated as Hedges [Member] | Fuel Hedge Contracts, Current [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Current | 2 | 19 |
Fuel hedge contracts [Member] | Derivative Instruments Not Designated as Hedges [Member] | Fuel Hedge Contracts, Noncurrent [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Noncurrent | 2 | 3 |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Prepaid Expenses and Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Current | 3 | 1 |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Other Noncurrent Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Noncurrent | 7 | 8 |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Other Accrued Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities, Current | (3) | (3) |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Other Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities, Noncurrent | (4) | (5) |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Accumulated Other Comprehensive Loss [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Accumulated other comprehensive loss | $ (1) | $ (2) |
DERIVATIVE INSTRUMENTS - INCOME
DERIVATIVE INSTRUMENTS - INCOME STATEMENT (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Gains (losses) recognized in aircraft rent [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Loss expected to be reclassified | $ 2 | ||
Gains (losses) recognized in interest income [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Loss expected to be reclassified | (3) | ||
Derivative Instruments Not Designated as Hedges [Member] | Fuel hedge contracts [Member] | Gains (losses) recognized in aircraft fuel expense [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Losses recognized in income | 1 | $ (6) | $ (3) |
Cash Flow Hedging [Member] | Derivative Instruments Designated as Hedges [Member] | Interest rate swaps agreements [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Losses in accumulated other comprehensive loss | 0 | 1 | 8 |
Cash Flow Hedging [Member] | Derivative Instruments Designated as Hedges [Member] | Interest rate swaps agreements [Member] | Gains (losses) recognized in aircraft rent [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Losses recognized in income | $ (3) | $ (5) | $ (6) |
DERIVATIVE INSTRUMENTS - FAIR V
DERIVATIVE INSTRUMENTS - FAIR VALUE OF HEDGE POSITIONS (Details) gallons in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($)gallonsaircraftagreement | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Derivative [Line Items] | |||
Net cash received (paid) to for new positions and settlements | $ 21 | $ (12) | $ (19) |
B737-800 [Member] | |||
Derivative [Line Items] | |||
Capital Leased Assets, Number of B737-800 Aircraft | aircraft | 6 | ||
Not Designated as Hedging Instrument [Member] | Fuel hedge contracts [Member] | |||
Derivative [Line Items] | |||
Fuel hedge contracts outstanding (in gallons) | gallons | 421 | ||
Secured Debt [Member] | Interest rate swaps agreements [Member] | |||
Derivative [Line Items] | |||
Number of interest rate swap agreements | agreement | 4 | ||
Derivative, Notional Amount | $ 382 | ||
Aircraft Rent [Member] | |||
Derivative [Line Items] | |||
Price Risk Cash Flow Hedge Unrealized Gain (Loss) to be Reclassified During Next 12 Months | (2) | ||
Interest Income [Member] | |||
Derivative [Line Items] | |||
Price Risk Cash Flow Hedge Unrealized Gain (Loss) to be Reclassified During Next 12 Months | $ 3 |
FAIR VALUE MEASUREMENTS - FAIR
FAIR VALUE MEASUREMENTS - FAIR VALUE OF ASSETS AND LIABILITIES (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 1,145 | |
Fair Value, Measurements, Recurring [Member] | Fuel hedge contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 4 | $ 22 |
Fair Value, Measurements, Recurring [Member] | Fuel hedge contracts [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Fuel hedge contracts [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 4 | 22 |
Fair Value, Measurements, Recurring [Member] | Interest rate swaps agreements [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 10 | 9 |
Derivative instruments, liabilities | (7) | (8) |
Fair Value, Measurements, Recurring [Member] | Interest rate swaps agreements [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 0 | 0 |
Derivative instruments, liabilities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Interest rate swaps agreements [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 10 | 9 |
Derivative instruments, liabilities | (7) | (8) |
Fair Value, Measurements, Recurring [Member] | U.S. government and agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 293 | 328 |
Fair Value, Measurements, Recurring [Member] | U.S. government and agency securities | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 293 | 328 |
Fair Value, Measurements, Recurring [Member] | U.S. government and agency securities | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 26 | 43 |
Fair Value, Measurements, Recurring [Member] | Foreign government bonds | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Foreign government bonds | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 26 | 43 |
Fair Value, Measurements, Recurring [Member] | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 190 | 209 |
Fair Value, Measurements, Recurring [Member] | Asset-backed securities | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Asset-backed securities | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 190 | 209 |
Fair Value, Measurements, Recurring [Member] | Mortgage-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 92 | 99 |
Fair Value, Measurements, Recurring [Member] | Mortgage-backed securities | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Mortgage-backed securities | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 92 | 99 |
Fair Value, Measurements, Recurring [Member] | Corporate notes and bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 520 | 726 |
Fair Value, Measurements, Recurring [Member] | Corporate notes and bonds | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Corporate notes and bonds | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 520 | 726 |
Fair Value, Measurements, Recurring [Member] | Municipal securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 10 | 22 |
Fair Value, Measurements, Recurring [Member] | Municipal securities | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Municipal securities | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities | $ 10 | $ 22 |
FAIR VALUE MEASUREMENTS FAIR VA
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS - CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Securities, Available-for-sale [Line Items] | |||
Sales and maturities of marketable securities | $ 1,116 | $ 1,388 | $ 962 |
FAIR VALUE MEASUREMENTS FAIR _2
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS - CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES - MATURITIES (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash, Cash Equivalents, and Short-term Investments [Abstract] | |||
Sales and maturities of marketable securities | $ 1,116 | $ 1,388 | $ 962 |
Debt Securities, Available-for-sale, Fair Value, Fiscal Year Maturity [Abstract] | |||
Due in one year or less | 138 | ||
Due after one year through five years | 981 | ||
Due after five years through 10 years | 12 | ||
Marketable securities | 1,131 | $ 1,427 | |
Debt Securities, Available-for-sale, Amortized Cost, Fiscal Year Maturity [Abstract] | |||
Due in one year or less | 138 | ||
Due after one year through five years | 995 | ||
Due after five years through 10 years | 12 | ||
Marketable securities | $ 1,145 |
FAIR VALUE MEASUREMENTS - LONG-
FAIR VALUE MEASUREMENTS - LONG-TERM DEBT (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Non-recurring purchase price accounting fair value adjustment | $ 3 | $ 3 |
Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fixed rate debt at cost | 639 | 956 |
Long-term debt | 642 | 959 |
Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | $ 641 | $ 959 |
LONG-TERM DEBT - SCHEDULE OF LO
LONG-TERM DEBT - SCHEDULE OF LONG-TERM DEBT (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||
Long-term Debt | $ 2,103 | $ 2,569 | |
Less debt issuance costs | (12) | (15) | |
Less current portion | 486 | 307 | |
Long-term debt, net of current portion | $ 1,617 | $ 2,262 | |
Weighted-average fixed-interest rate | 4.10% | 4.20% | |
Weighted-average variable-interest rate | 3.90% | 2.80% | |
Proceeds from issuance of long-term debt, net of issuance costs | $ 339 | $ 0 | $ 2,044 |
Long-term debt payments | 807 | 397 | $ 249 |
Repayments of debt | 451 | ||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
2,019 | 488 | ||
2,020 | 305 | ||
2,021 | 263 | ||
2,022 | 216 | ||
2,023 | 262 | ||
Thereafter | 579 | ||
Long-term Debt | 2,113 | ||
Fixed-rate notes payable due through 2028 | |||
Debt Instrument [Line Items] | |||
Long-term Debt | 642 | 959 | |
Variable-rate notes payable due through 2028 | |||
Debt Instrument [Line Items] | |||
Long-term Debt | $ 1,473 | $ 1,625 |
LONG-TERM DEBT LONG-TERM DEBT -
LONG-TERM DEBT LONG-TERM DEBT - SECURED DEBT (Details) - USD ($) $ in Millions | 2 Months Ended | 12 Months Ended | ||
Feb. 15, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||||
Debt instrument, increase (decrease) | $ (466) | |||
Long-term Debt | 2,103 | $ 2,569 | ||
Long-term debt payments | 807 | 397 | $ 249 | |
Repayments of debt | 451 | |||
Proceeds from Issuance of Debt | $ 339 | $ 0 | $ 2,044 | |
Subsequent Event [Member] | ||||
Debt Instrument [Line Items] | ||||
Repayments of debt | $ 262 | |||
Proceeds from Issuance of Debt | $ 254 |
LONG-TERM DEBT - LINE OF CREDIT
LONG-TERM DEBT - LINE OF CREDIT (Details) | 12 Months Ended | |||
Dec. 31, 2018USD ($)credit_facility | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | |
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 516,000,000 | |||
Number of credit facilities | credit_facility | 3 | |||
Credit Facility 1 [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, asset restrictions, unrestricted cash and marketable securities | $ 500,000,000 | |||
Credit Facility 1 [Member] | Secured by aircraft [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 250,000,000 | |||
Line of Credit Facility, Expiration Date | Jun. 30, 2021 | |||
Number of credit facilities | credit_facility | 1 | |||
Credit Facility 2 [Member] | Secured by other [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 150,000,000 | |||
Line of Credit Facility, Expiration Date | Mar. 31, 2022 | |||
Credit Facility 3 [Member] | Secured by aircraft [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 116,000,000 | $ 75,000,000 | ||
Line of Credit Facility, Expiration Date | Jul. 31, 2019 | |||
Credit Facilities 1 and 2 [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Number of credit facilities, no borrowing | credit_facility | 2 |
INCOME TAXES - DEFERRED TAX ASS
INCOME TAXES - DEFERRED TAX ASSETS AND LIABILITIES (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Excess of tax over book depreciation | $ 1,066 | $ 964 |
Deferred Tax Liabilities, Intangible Assets | 15 | 14 |
Deferred Tax Liabilities, Other | 43 | 88 |
Gross deferred tax liabilities | 1,124 | 1,066 |
Mileage Plan | (315) | (337) |
Inventory obsolescence | (15) | (16) |
Deferred gains | (5) | (5) |
Employee benefits | (172) | (154) |
Acquired net operating losses | (64) | (127) |
Other—net | (43) | (57) |
Deferred tax assets | (614) | (696) |
Valuation allowance | 2 | 0 |
Net deferred tax liabilities | 512 | $ 370 |
Federal [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss | 243 | |
State [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss | $ 189 | |
Minimum [Member] | Federal [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards, Expiration Date | Jan. 1, 2032 | |
Minimum [Member] | State [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards, Expiration Date | Jan. 1, 2029 | |
Maximum [Member] | Federal [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards, Expiration Date | Jan. 1, 2036 | |
Maximum [Member] | State [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Operating Loss Carryforwards, Expiration Date | Jan. 1, 2036 |
INCOME TAXES - COMPONENTS OF TA
INCOME TAXES - COMPONENTS OF TAX EXPENSE (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current tax expense (benefit): | |||
Federal | $ (5) | $ 127 | $ 392 |
State | 9 | 35 | 48 |
Total current | 4 | 162 | 440 |
Deferred tax expense: | |||
Federal | 125 | (3) | 67 |
State | 19 | 40 | 12 |
Total deferred | 144 | 37 | 79 |
Income tax expense | $ 148 | $ 199 | $ 519 |
INCOME TAXES - EFFECTIVE INCOME
INCOME TAXES - EFFECTIVE INCOME TAX RECONCILIATION (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Business Acquisition [Line Items] | |||
U.S. federal tax rate | 21.00% | 35.00% | 35.00% |
Income before income tax | $ 585 | $ 1,159 | $ 1,316 |
Expected tax expense | 123 | 406 | 461 |
Nondeductible expenses | 9 | 5 | 20 |
State income taxes | 21 | 28 | 27 |
State income sourcing | 0 | 9 | 12 |
Tax law changes | (7) | (237) | 0 |
Other—net | 2 | (12) | (1) |
Income tax expense | $ 148 | $ 199 | $ 519 |
Effective tax rate | 25.30% | 17.20% | 39.40% |
Virgin America Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Nondeductible expenses | $ 39 |
INCOME TAXES INCOME TAXES - UNC
INCOME TAXES INCOME TAXES - UNCERTAIN TAX POSITIONS (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Contingency [Line Items] | ||||
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | $ 33 | |||
Income Tax Examination, Penalties and Interest Accrued | 6 | $ 5 | $ 3 | |
Income Tax Examination, Penalties and Interest Expense | 1 | 2 | $ 3 | |
Unrecognized Tax Benefits, Period Increase (Decrease) | 3 | |||
Beginning balance | 43 | 40 | 32 | |
Additions related to prior years | 1 | 16 | 0 | |
Releases related to prior years | (4) | (2) | 0 | |
Additions related to current year activity | 2 | 2 | 0 | |
Additions from acquisitions | 0 | 0 | 8 | |
Releases due to settlements | (1) | (11) | 0 | |
Releases due to lapse of statute of limitations | (1) | (2) | 0 | |
Ending balance | $ 40 | $ 43 | $ 40 |
INCOME TAXES INCOME TAXES NARRA
INCOME TAXES INCOME TAXES NARRATIVE (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||
New Accounting Pronouncement or Change in Accounting Principle, Description of Prior-period Information Retrospectively Adjusted | 26 | 12 | |
Tax law changes | $ (7) | $ (237) | $ 0 |
INCOME TAXES NEW ACCOUNTING STA
INCOME TAXES NEW ACCOUNTING STANDARDS (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Other Special Items [Line Items] | ||
Deferred Tax Liabilities, Other | $ 43 | $ 88 |
Deferred income taxes | (512) | (370) |
Valuation allowance | $ 2 | 0 |
Accounting Standards Update 2014-09 [Member] | Restatement Adjustment [Member] | ||
Other Special Items [Line Items] | ||
Deferred Tax Liabilities, Other | 45 | |
Deferred Tax Assets, Net | 129 | |
Deferred income taxes | $ 84 |
EMPLOYEE BENEFIT PLANS EMPLOYEE
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS - ADDITIONAL INFORMATION (Details) | 12 Months Ended |
Dec. 31, 2018plan | |
Business Acquisition [Line Items] | |
Number of Qualified Defined Benefit Plans | 4 |
Number of defined benefit plans | 1 |
Number of defined contribution plans | 7 |
EMPLOYEE BENEFIT PLANS - ASSUMP
EMPLOYEE BENEFIT PLANS - ASSUMPTIONS (Details) - Qualified Defined Benefit [Member] | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Minimum [Member] | |||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Benefit obligations, Weighted-average discount rate | 4.37% | 3.69% | 4.29% |
Benefit obligations, Rate of compensation increase | 2.11% | 2.11% | 2.12% |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Net period benefit costs, Weighted-average discount rate | 3.69% | 4.29% | 4.55% |
Net period benefit costs, Weighted-average expected return on assets | 4.25% | 5.50% | 6.00% |
Net period benefit costs, Rate of compensation increase | 2.11% | 2.12% | 2.06% |
Maximum [Member] | |||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Benefit obligations, Weighted-average discount rate | 4.46% | 3.78% | 4.50% |
Benefit obligations, Rate of compensation increase | 3.50% | 16.51% | 2.59% |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Net period benefit costs, Weighted-average discount rate | 3.78% | 4.50% | 4.69% |
Net period benefit costs, Weighted-average expected return on assets | 5.50% | 6.00% | 6.50% |
Net period benefit costs, Rate of compensation increase | 16.51% | 2.59% | 2.65% |
EMPLOYEE BENEFIT PLANS - PLAN A
EMPLOYEE BENEFIT PLANS - PLAN ASSETS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Qualified Defined Benefit [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 1,858 | $ 2,083 | $ 1,846 |
Plan asset allocations | 100.00% | 100.00% | |
Qualified Defined Benefit [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 1,749 | $ 1,973 | |
Qualified Defined Benefit [Member] | Equity funds [Member] | U.S. | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 28.00% | 29.00% | |
Qualified Defined Benefit [Member] | Equity funds [Member] | U.S. | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 431 | $ 515 | |
Qualified Defined Benefit [Member] | Equity funds [Member] | Non-US [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 12.00% | 12.00% | |
Qualified Defined Benefit [Member] | Equity funds [Member] | Non-US [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 183 | $ 226 | |
Qualified Defined Benefit [Member] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 53.00% | 52.00% | |
Qualified Defined Benefit [Member] | Credit bond index fund [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 1,135 | $ 1,232 | |
Qualified Defined Benefit [Member] | Real Estate [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 7.00% | 6.00% | |
Qualified Defined Benefit [Member] | Real Estate [Member] | Level 3 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 104 | $ 97 | |
Qualified Defined Benefit [Member] | Cash Equivalents [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 0.00% | 1.00% | |
Qualified Defined Benefit [Member] | Cash Equivalents [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 5 | $ 13 | |
Qualified Defined Benefit Plan - Salaried [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 100.00% | 100.00% | |
Qualified Defined Benefit Plan - Salaried [Member] | Equity funds [Member] | U.S. | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 6.00% | 8.00% | |
Qualified Defined Benefit Plan - Salaried [Member] | Equity funds [Member] | Non-US [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 3.00% | 3.00% | |
Qualified Defined Benefit Plan - Salaried [Member] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 91.00% | 89.00% | |
Qualified Defined Benefit Plan - Salaried [Member] | Real Estate [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 0.00% | 0.00% | |
Qualified Defined Benefit Plan - Salaried [Member] | Cash Equivalents [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 0.00% | 0.00% | |
Minimum [Member] | Qualified Defined Benefit [Member] | Equity funds [Member] | U.S. | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.25 | ||
Minimum [Member] | Qualified Defined Benefit [Member] | Equity funds [Member] | Non-US [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.1 | ||
Minimum [Member] | Qualified Defined Benefit [Member] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.48 | ||
Minimum [Member] | Qualified Defined Benefit [Member] | Real Estate [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.02 | ||
Minimum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Equity funds [Member] | U.S. | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.05 | ||
Minimum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Equity funds [Member] | Non-US [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.01 | ||
Minimum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.86 | ||
Minimum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Real Estate [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0 | ||
Maximum [Member] | Qualified Defined Benefit [Member] | Equity funds [Member] | U.S. | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.33 | ||
Maximum [Member] | Qualified Defined Benefit [Member] | Equity funds [Member] | Non-US [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.16 | ||
Maximum [Member] | Qualified Defined Benefit [Member] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.94 | ||
Maximum [Member] | Qualified Defined Benefit [Member] | Real Estate [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.08 | ||
Maximum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Equity funds [Member] | U.S. | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.09 | ||
Maximum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Equity funds [Member] | Non-US [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.05 | ||
Maximum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0.94 | ||
Maximum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Real Estate [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 0 |
EMPLOYEE BENEFIT PLANS - FUNDED
EMPLOYEE BENEFIT PLANS - FUNDED STATUS (Details) - Qualified Defined Benefit [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Benefit obligation | |||
Beginning of year | $ 2,387 | $ 2,043 | |
Service cost | 48 | 39 | $ 37 |
Interest cost | 79 | 74 | 73 |
Actuarial (gain) loss | (191) | 300 | |
Defined Benefit Plan, Benefit Obligation, Benefits Paid | (98) | (69) | |
End of year | 2,225 | 2,387 | 2,043 |
Plan assets at fair value | |||
Beginning of year | 2,083 | 1,846 | |
Actual return on plan assets | (127) | 291 | |
Employer contributions | 0 | 15 | |
Defined Benefit Plan, Plan Assets, Benefits Paid | (98) | (69) | |
End of year | 1,858 | 2,083 | $ 1,846 |
Funded status (unfunded) | $ (367) | $ (304) | |
Percent funded | 84.00% | 87.00% | |
Accumulated benefit obligation | $ 2,100 | $ 2,200 | |
Defined Benefit Plan, Plan Assets, Benefits Paid | $ 98 | $ 69 |
EMPLOYEE BENEFIT PLANS - AMOUNT
EMPLOYEE BENEFIT PLANS - AMOUNTS RECOGNIZED IN CONSOLIDATED BALANCE SHEETS (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Liability, Defined Benefit Plan [Abstract] | ||
Accrued benefit liability-long term | $ 503 | $ 453 |
Qualified Defined Benefit [Member] | ||
Liability, Defined Benefit Plan [Abstract] | ||
Accrued benefit liability-long term | 392 | 335 |
Plan assets-long term (within Other noncurrent assets) | (25) | (31) |
Total liability recognized | 367 | 304 |
Defined Benefit Plan, Accumulated Other Comprehensive (Income) Loss, before Tax [Abstract] | ||
Prior service credit | (8) | (9) |
Net loss | 607 | 597 |
Amount recognized in AOCL (pretax) | $ 599 | $ 588 |
EMPLOYEE BENEFIT PLANS - EXPECT
EMPLOYEE BENEFIT PLANS - EXPECTED AMORTIZATION FROM AOCI (Details) - Qualified Defined Benefit [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Expected Return (Loss) on Plan Assets | $ 107 | $ 106 | $ 108 |
Prior service credit | 1 | ||
Net loss | $ 37 |
EMPLOYEE BENEFIT PLANS - NET PE
EMPLOYEE BENEFIT PLANS - NET PENSION EXPENSE (Details) - Qualified Defined Benefit [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | |||
Service cost | $ 48 | $ 39 | $ 37 |
Interest cost | 79 | 74 | 73 |
Defined Benefit Plan, Expected Return (Loss) on Plan Assets | 107 | 106 | 108 |
Amortization of prior service cost | (1) | (1) | (1) |
Defined Benefit Plan, Amortization of Gain (Loss) | (33) | (26) | (25) |
Net pension expense | $ 52 | $ 32 | $ 26 |
EMPLOYEE BENEFIT PLANS - FUTURE
EMPLOYEE BENEFIT PLANS - FUTURE BENEFITS EXPECTED TO BE PAID (Details) - Qualified Defined Benefit [Member] $ in Millions | Dec. 31, 2018USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
2,019 | $ 99 |
2,020 | 113 |
2,021 | 115 |
2,022 | 129 |
2,023 | 132 |
2024– 2028 | $ 741 |
EMPLOYEE BENEFIT PLANS EMPLOY_2
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS - POSTRETIREMENT MEDICAL BENEFITS (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Postretirement Medical Benefits [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Benefit obligation | $ 82 | $ 85 |
EMPLOYEE BENEFIT PLANS - DEFINE
EMPLOYEE BENEFIT PLANS - DEFINED CONTRIBUTION PLANS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Retirement Benefits [Abstract] | |||
Total expense for the defined-contribution plans | $ 126 | $ 103 | $ 67 |
EMPLOYEE BENEFIT PLANS - PILOT
EMPLOYEE BENEFIT PLANS - PILOT LONG-TERM DISABILITY BENEFITS (Details) - Postretirement Health Coverage [Member] - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Defined Benefit Plan Disclosure [Line Items] | ||
Total liability net of a prefunded trust account | $ 25 | $ 28 |
Prefunded trust account | $ 3 | $ 3 |
EMPLOYEE BENEFIT PLANS - EMPLOY
EMPLOYEE BENEFIT PLANS - EMPLOYEE INCENTIVE-PAY PLANS (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($)$ / Quarter | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Retirement Benefits [Abstract] | |||
Operational Performance Rewards Program entitles all Air Group employees to maximum quarterly payouts (in dollars per quarter) | $ / Quarter | 300 | ||
Variable incentive pay | $ | $ 147 | $ 135 | $ 127 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018USD ($)aircraftcarriers | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Rent expense | $ 619 | $ 552 | $ 315 |
Capacity purchase arrangements, Carriers | carriers | 3 | ||
Loss Contingency, Damages Awarded, Value | $ 78 | ||
Horizon [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Capacity purchase arrangements, Percent | 100.00% | ||
Aircraft Commitments [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
2,019 | $ 495 | ||
2,020 | 517 | ||
2,021 | 556 | ||
2,022 | 307 | ||
2,023 | 108 | ||
Thereafter | 33 | ||
Total | 2,016 | ||
Capacity Purchase Agreements[Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
2,019 | 138 | ||
2,020 | 145 | ||
2,021 | 166 | ||
2,022 | 174 | ||
2,023 | 179 | ||
Thereafter | 1,065 | ||
Total | 1,867 | ||
Aircraft Leases [Member] | |||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||
2,019 | 350 | ||
2,020 | 320 | ||
2,021 | 286 | ||
2,022 | 262 | ||
2,023 | 208 | ||
Thereafter | 847 | ||
Total | 2,273 | ||
Facility Leases [Member] | |||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||
2,019 | 133 | ||
2,020 | 124 | ||
2,021 | 113 | ||
2,022 | 94 | ||
2,023 | 26 | ||
Thereafter | 122 | ||
Total | $ 612 | ||
B-737 [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Commited to purchase (in aircraft) | aircraft | 36 | ||
Option to purchase additional (in aircraft) | aircraft | 37 | ||
A-320-Neo [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Option to purchase additional (in aircraft) | aircraft | 30 | ||
B737-900ER [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Commited to purchase (in aircraft) | aircraft | 4 | ||
B737 MAX [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Commited to purchase (in aircraft) | aircraft | 32 | ||
E175 [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Commited to purchase (in aircraft) | aircraft | 7 | ||
Option to purchase additional (in aircraft) | aircraft | 30 | ||
Property Subject to Operating Lease [Member] | B-737 [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 10 | ||
Property Subject to Operating Lease [Member] | Q400 [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 9 | ||
Property Subject to Operating Lease [Member] | Airbus [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 61 | ||
Property Subject to Operating Lease [Member] | E175 [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 32 | ||
Property Subject to or Available for Operating Lease, Number of Optional Additional Units | aircraft | 3 | ||
Property Available for Operating Lease [Member] | A321neo [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Property Subject to or Available for Operating Lease, Number of Optional Additional Units | aircraft | 2 | ||
Capacity Purchase Agreement with SkyWest [Member] | E175 [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Property Subject to or Available for Operating Lease, Number of Optional Additional Units | aircraft | 8 | ||
Aircraft Maintenance Deposits [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
2,019 | $ 61 | ||
2,020 | 65 | ||
2,021 | 59 | ||
2,022 | 48 | ||
2,023 | 24 | ||
Thereafter | 8 | ||
Total | $ 265 |
SHAREHOLDER'S EQUITY SHAREHOLDE
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - STOCK CHANGES (Details) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Equity [Abstract] | ||
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
SHAREHOLDER'S EQUITY SHAREHOL_2
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - DIVIDENDS (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 19, 2019 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Subsequent Event [Line Items] | |||||
Cash dividend declared per share | $ 0.32 | $ 1.28 | $ 1.20 | $ 1.10 | |
Cash dividend paid | $ 158 | $ 148 | $ 136 | ||
Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Cash dividend declared per share | $ 0.35 | ||||
Dividend increase | 9.00% |
SHAREHOLDER'S EQUITY - COMMON S
SHAREHOLDER'S EQUITY - COMMON STOCK REPURCHASE (Details) - USD ($) $ in Millions | 12 Months Ended | 40 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2018 | Aug. 31, 2015 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Common stock repurchase | $ 50 | $ 75 | $ 193 | ||
2015 $1 billion Repurchase Program [Member] | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Share repurchase program, authorized amount | $ 1,000 | ||||
Common stock repurchase (in shares) | 776,186 | 981,277 | 2,594,809 | 5,869,549 | |
Common stock repurchase | $ 50 | $ 75 | $ 193 | $ 438 |
SHAREHOLDER'S EQUITY SHAREHOL_3
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - OTHER (Details) - shares | Dec. 31, 2018 | Dec. 31, 2017 |
Equity [Abstract] | ||
Treasury stock, shares | 7,619,046 | 6,842,860 |
SHAREHOLDER'S EQUITY SHAREHOL_4
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Millions | Jan. 01, 2018 | Dec. 31, 2018 | Dec. 31, 2017 |
Equity [Abstract] | |||
Tax Cuts and Jobs Act, Reclassification from AOCI to Retained Earnings, Tax Effect | $ 0 | ||
Unrealized gain on marketable securities considered available-for-sale | $ (11) | $ (5) | |
Related to employee benefit plans | (440) | (376) | |
Related to interest rate derivatives | 3 | 1 | |
Accumulated other comprehensive loss | $ (448) | $ (380) |
SPECIAL ITEMS SPECIAL ITEMS (De
SPECIAL ITEMS SPECIAL ITEMS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Merger-related Costs [Line Items] | |||
Special items - merger-related costs | $ 87 | $ 116 | $ 117 |
Special items—other | 45 | 0 | 0 |
Nondeductible expenses | 9 | 5 | 20 |
Special tax expense (benefit) | 0 | (237) | 17 |
Virgin America Inc. [Member] | |||
Merger-related Costs [Line Items] | |||
Special items - merger-related costs | 87 | $ 116 | 117 |
Nondeductible expenses | $ 39 | ||
Settlement Fee [Member] | |||
Merger-related Costs [Line Items] | |||
Special items—other | 20 | ||
One-time Bonus Payment [Member] | |||
Merger-related Costs [Line Items] | |||
Special items—other | $ 25 |
SPECIAL ITEMS SPECIAL ITEMS - M
SPECIAL ITEMS SPECIAL ITEMS - MERGER-RELATED COSTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Merger-related Costs [Line Items] | |||
Contracted services | $ 306 | $ 314 | $ 247 |
Special items—merger-related costs | 87 | 116 | 117 |
Virgin America Inc. [Member] | |||
Merger-related Costs [Line Items] | |||
Contracted services | 45 | 52 | 32 |
Severance Costs | 13 | 41 | 22 |
Banking Fees and Commissions | 0 | 0 | 36 |
Legal Fees | 1 | 3 | 22 |
Business Acquisition, Transaction Costs | 28 | 20 | 5 |
Special items—merger-related costs | $ 87 | $ 116 | $ 117 |
SPECIAL ITEMS Other Special Ite
SPECIAL ITEMS Other Special Items (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Other Special Items [Line Items] | |||
Special items—other | $ 45 | $ 0 | $ 0 |
Settlement Fee [Member] | |||
Other Special Items [Line Items] | |||
Special items—other | 20 | ||
One-time Bonus Payment [Member] | |||
Other Special Items [Line Items] | |||
Special items—other | $ 25 |
STOCK-BASED COMPENSATION PLAN_2
STOCK-BASED COMPENSATION PLANS (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 36 | $ 34 | $ 19 |
Tax benefit related to stock-based compensation | 9 | 13 | 7 |
Unrecognized stock-based compensation for non-vested options and awards | $ 29 | ||
Unrecognized stock-based compensation awards weighted-average period | 1 year 7 months 8 days | ||
Shares authorized under stock-based compensation plans (in shares) | 17,000,000 | ||
Shares remaining available for future grants (shares) | 9,851,918 | ||
Stock options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 3 | $ 3 | $ 2 |
Unrecognized stock-based compensation for non-vested options and awards | $ 3 | ||
Unrecognized stock-based compensation awards weighted-average period | 1 year 4 months 20 days | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |||
Expected volatility | 30.00% | 51.00% | 51.00% |
Expected term | 6 years | 6 years | 6 years |
Risk-free interest rate | 2.61% | 2.04% | 1.23% |
Expected dividend yield | 1.94% | 1.10% | 1.50% |
Weighted-average grant date fair value per share (in dollars per share) | $ 17.18 | $ 41.19 | $ 27.14 |
Estimated fair value of options granted (millions) | $ 1 | $ 4 | $ 2 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Outstanding, beginning balance (in shares) | 441,467 | ||
Granted (in Shares) | 204,700 | ||
Exercised (in shares) | (40,848) | ||
Canceled (in shares) | (6,937) | ||
Forfeited or expired (in shares) | (25,140) | ||
Outstanding, ending balance (in shares) | 573,242 | 441,467 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||
Outstanding, beginning balance, Weighted-Average Exercise Price Per Share (in dollars per share) | $ 52.34 | ||
Granted, Weighted-Average Exercise Price Per Share (in dollars per share) | 66.67 | ||
Exercised, Weighted-Average Exercise Price Per Share (in dollars per share) | 32.76 | ||
Canceled, Weighted-Average Exercise Price Per Share (in dollars per share) | 67.12 | ||
Fofeited or expired, Weighted-Average Exercise Price Per Share (in dollars per share) | 72.67 | ||
Outstanding, ending balance, Weighted-Average Exercise Price Per Share (in dollars per share) | $ 57.78 | $ 52.34 | |
Outstanding, Weighted-Average Contractual Life | 6 years 7 months 5 days | 6 years | |
Outstanding, Aggregate Intrinsic Value | $ 6 | $ 11 | |
Exercisable, Outstanding (in shares) | 265,113 | ||
Exercisable, Weighted-Average Exercise Price Per Share (in dollars per share) | $ 41.47 | ||
Exercisable, Weighted-Average Contractual Life | 4 years 6 months | ||
Exercisable, Aggregate Intrinsic Value | $ 6 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest [Abstract] | |||
Vested or expected to vest, Shares | 573,242 | ||
Vested or expected to vest, Weighted-Average Exercise Price Per Share (in dollars per share) | $ 57.78 | ||
Vested or expected to vest, Weighted-Average Contractual Life | 6 years 7 months 5 days | ||
Vested or expected to vest, Aggregate Intrinsic Value | $ 6 | ||
Intrinsic value of option exercises | 1 | 6 | 9 |
Cash received from stock option exercises | 1 | 3 | 3 |
Tax benefit related to stock option exercises | 0 | 2 | 3 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 2 | 3 | 3 |
Stock awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | 23 | $ 24 | 11 |
Unrecognized stock-based compensation for non-vested options and awards | $ 26 | ||
Unrecognized stock-based compensation awards weighted-average period | 1 year 7 months 8 days | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Non-vested, beginning balance (in shares) | 525,145 | ||
Granted (in shares) | 401,424 | ||
Vested (in shares) | (310,403) | ||
Forfeited (in shares) | (104,353) | ||
Non-vested, ending balance (in shares) | 511,813 | 525,145 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Non-vested, beginning balance, Weighted-Average Grant Date Fair Value (in dollars per share) | $ 85.47 | ||
Granted, Weighted-Average Grant Date Fair Value (in dollars per share) | 66.55 | ||
Vested, Weighted-Average Grant Date Fair Value (in dollars per share) | 73.33 | ||
Forfeited, Weighted-Average Grant Date Fair Value (in dollars per share) | 80.77 | ||
Non-vested, ending balance, Weighted-Average Price Per Share (in dollars per share) | $ 78.75 | $ 85.47 | |
Non-vested, Weighted-Average Contractual Life | 1 year 6 months | 1 year 7 months 24 days | |
Non-vested, Total Instrinsic Value (in dollars) | $ 31 | $ 39 | |
Deferred stock awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | 1 | 1 | 1 |
Employee stock purchase plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 9 | $ 6 | $ 5 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Granted (in shares) | 632,145 | 406,628 | 308,920 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent | 85.00% | ||
Share-based Compensation Arrangement by Share-based Payment Award, Maximum Employee Subscription Rate | 10.00% |
OPERATING SEGMENT INFORMATION_2
OPERATING SEGMENT INFORMATION (Details) - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||||
Operating revenues | ||||||
Total Operating Revenues | $ 8,264 | $ 7,894 | $ 5,925 | |||
Operating expenses | ||||||
Operating expenses, excluding fuel | 5,685 | 5,239 | 3,788 | |||
Special items - merger-related costs | 87 | 116 | 117 | |||
Economic fuel | 1,936 | 1,447 | 831 | |||
Total Operating Expenses | 7,621 | 6,686 | 4,619 | |||
Nonoperating Income (Expense) | ||||||
Interest income | 38 | 34 | 27 | |||
Interest expense | (91) | (103) | (55) | |||
Interest capitalized | 18 | 17 | 25 | |||
Other—net | (23) | 3 | 13 | |||
Nonoperating Income (Expense) Total | (58) | (49) | 10 | |||
Income (loss) before income tax | 585 | 1,159 | 1,316 | |||
Depreciation | 398 | 372 | 363 | |||
Total property and equipment additions | (960) | (1,026) | (678) | |||
Total assets | 10,912 | 10,746 | ||||
Air Group Adjusted [Member] | ||||||
Operating revenues | ||||||
Total Operating Revenues | [1] | 8,264 | 7,894 | 5,925 | ||
Operating expenses | ||||||
Operating expenses, excluding fuel | [1] | 5,553 | 5,123 | 3,671 | ||
Economic fuel | [1] | 1,914 | 1,454 | 844 | ||
Total Operating Expenses | [1] | 7,467 | 6,577 | 4,515 | ||
Nonoperating Income (Expense) | ||||||
Interest income | 38 | 34 | 27 | |||
Interest expense | (91) | (103) | (55) | |||
Interest capitalized | 18 | 17 | 25 | |||
Other—net | (23) | 3 | 13 | |||
Nonoperating Income (Expense) Total | [1] | (58) | (49) | 10 | ||
Income (loss) before income tax | [1] | 739 | 1,268 | 1,420 | ||
Alaska Mainline [Member] | ||||||
Operating revenues | ||||||
Total Operating Revenues | 7,063 | 6,832 | 4,908 | |||
Operating expenses | ||||||
Operating expenses, excluding fuel | 4,577 | 4,271 | 2,919 | |||
Economic fuel | 1,652 | 1,282 | 719 | |||
Total Operating Expenses | 6,229 | 5,553 | 3,638 | |||
Nonoperating Income (Expense) | ||||||
Interest income | 53 | 39 | 26 | |||
Interest expense | (82) | (92) | (42) | |||
Interest capitalized | 16 | 15 | 20 | |||
Other—net | (12) | 3 | 13 | |||
Nonoperating Income (Expense) Total | (25) | (35) | 17 | |||
Income (loss) before income tax | 809 | 1,244 | 1,287 | |||
Depreciation | [2] | 316 | 308 | 296 | ||
Total property and equipment additions | [2] | (571) | (734) | (608) | ||
Total assets | [2] | 16,853 | 16,663 | |||
Alaska Regional [Member] | ||||||
Operating revenues | ||||||
Total Operating Revenues | 1,197 | 1,058 | 1,018 | |||
Operating expenses | ||||||
Operating expenses, excluding fuel | 1,024 | 852 | 769 | |||
Economic fuel | 262 | 172 | 125 | |||
Total Operating Expenses | 1,286 | 1,024 | 894 | |||
Nonoperating Income (Expense) | ||||||
Interest income | 0 | 0 | 0 | |||
Interest expense | 0 | 0 | 0 | |||
Interest capitalized | 0 | 0 | 0 | |||
Other—net | (11) | 0 | 0 | |||
Nonoperating Income (Expense) Total | (11) | 0 | 0 | |||
Income (loss) before income tax | (100) | 34 | 124 | |||
Horizon [Member] | ||||||
Operating revenues | ||||||
Total Operating Revenues | 512 | 430 | 424 | |||
Operating expenses | ||||||
Operating expenses, excluding fuel | 465 | 427 | 407 | |||
Economic fuel | 0 | 0 | 0 | |||
Total Operating Expenses | 465 | 427 | 407 | |||
Nonoperating Income (Expense) | ||||||
Interest income | 0 | 0 | 1 | |||
Interest expense | (22) | (13) | (9) | |||
Interest capitalized | 2 | 2 | 1 | |||
Other—net | 0 | 0 | 0 | |||
Nonoperating Income (Expense) Total | (20) | (11) | (7) | |||
Income (loss) before income tax | 27 | (8) | 10 | |||
Depreciation | 82 | 64 | 67 | |||
Total property and equipment additions | (389) | (292) | (70) | |||
Total assets | 1,229 | 929 | ||||
Parent [Member] | ||||||
Nonoperating Income (Expense) | ||||||
Total assets | (7,170) | (6,846) | ||||
Intersegment Eliminations | ||||||
Operating revenues | ||||||
Total Operating Revenues | (508) | (426) | (425) | |||
Operating expenses | ||||||
Operating expenses, excluding fuel | (513) | (427) | (424) | |||
Economic fuel | 0 | 0 | 0 | |||
Total Operating Expenses | (513) | (427) | (424) | |||
Nonoperating Income (Expense) | ||||||
Interest income | (15) | (5) | 0 | |||
Interest expense | 13 | 2 | (4) | |||
Interest capitalized | 0 | 0 | 4 | |||
Other—net | 0 | 0 | 0 | |||
Nonoperating Income (Expense) Total | (2) | (3) | 0 | |||
Income (loss) before income tax | 3 | (2) | (1) | |||
Special Charges [Member] | ||||||
Operating revenues | ||||||
Total Operating Revenues | [3] | 0 | 0 | 0 | ||
Operating expenses | ||||||
Operating expenses, excluding fuel | 132 | 116 | [3] | 117 | [3] | |
Economic fuel | 22 | (7) | [3] | (13) | [3] | |
Total Operating Expenses | [3] | 154 | 109 | 104 | ||
Nonoperating Income (Expense) | ||||||
Interest income | 0 | 0 | 0 | |||
Interest expense | 0 | 0 | 0 | |||
Interest capitalized | 0 | 0 | 0 | |||
Other—net | 0 | 0 | 0 | |||
Nonoperating Income (Expense) Total | [3] | 0 | 0 | 0 | ||
Income (loss) before income tax | [3] | (154) | (109) | (104) | ||
Passenger Revenue [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 7,632 | 7,301 | 5,392 | |||
Passenger Revenue [Member] | Air Group Adjusted [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 7,632 | 7,301 | 5,392 | ||
Passenger Revenue [Member] | Alaska Mainline [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 6,475 | 6,278 | 4,415 | |||
Passenger Revenue [Member] | Alaska Regional [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,157 | 1,023 | 977 | |||
Passenger Revenue [Member] | Horizon [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |||
Passenger Revenue [Member] | Intersegment Eliminations | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |||
Passenger Revenue [Member] | Special Charges [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [3] | 0 | 0 | 0 | ||
Capacity Purchase Agreements [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |||
Capacity Purchase Agreements [Member] | Air Group Adjusted [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 0 | 0 | 0 | ||
Capacity Purchase Agreements [Member] | Alaska Mainline [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |||
Capacity Purchase Agreements [Member] | Alaska Regional [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |||
Capacity Purchase Agreements [Member] | Horizon [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 508 | 426 | 424 | |||
Capacity Purchase Agreements [Member] | Intersegment Eliminations | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | (508) | (426) | (424) | |||
Capacity Purchase Agreements [Member] | Special Charges [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [3] | 0 | 0 | 0 | ||
Mileage Plan Services, Other [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 434 | 418 | 370 | |||
Mileage Plan Services, Other [Member] | Air Group Adjusted [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 434 | 418 | 370 | ||
Mileage Plan Services, Other [Member] | Alaska Mainline [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 397 | 387 | 333 | |||
Mileage Plan Services, Other [Member] | Alaska Regional [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 37 | 31 | 37 | |||
Mileage Plan Services, Other [Member] | Horizon [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |||
Mileage Plan Services, Other [Member] | Intersegment Eliminations | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |||
Mileage Plan Services, Other [Member] | Special Charges [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [3] | 0 | 0 | 0 | ||
Cargo and Freight [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 198 | 175 | 163 | |||
Cargo and Freight [Member] | Air Group Adjusted [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [1] | 198 | 175 | 163 | ||
Cargo and Freight [Member] | Alaska Mainline [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 191 | 167 | 160 | |||
Cargo and Freight [Member] | Alaska Regional [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 3 | 4 | 4 | |||
Cargo and Freight [Member] | Horizon [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 4 | 4 | 0 | |||
Cargo and Freight [Member] | Intersegment Eliminations | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | (1) | |||
Cargo and Freight [Member] | Special Charges [Member] | ||||||
Operating revenues | ||||||
Revenue from Contract with Customer, Excluding Assessed Tax | [3] | $ 0 | $ 0 | $ 0 | ||
[1] | Year Ended December 31, 2016 Mainline(a) Regional Horizon Consolidating & Other(b) Air Group Adjusted(c) Special Items(d) ConsolidatedOperating revenues Passenger revenues4,415 977 — — 5,392 — 5,392CPA revenues— — 424 (424) — — —Mileage Plan other revenue333 37 — — 370 — 370Cargo and other160 4 — (1) 163 — 163Total operating revenues4,908 1,018 424 (425) 5,925 — 5,925Operating expenses Non-fuel operating expenses2,919 769 407 (424) 3,671 117 3,788Fuel expense719 125 — — 844 (13) 831Total operating expenses3,638 894 407 (424) 4,515 104 4,619Nonoperating income (expense) Interest income26 — 1 — 27 — 27Interest expense(42) — (9) (4) (55) — (55)Interest capitalized20 — 1 4 25 — 25Other13 — — — 13 — 13Total nonoperating income (expense)17 — (7) — 10 — 10Income (loss) before income tax$1,287 $124 $10 $(1) $1,420 $(104) $1,316 | |||||
[2] | 2018 2017 2016Depreciation and amortization: Mainline$316 $308 $296Horizon82 64 67Consolidated$398 $372 $363 Capital expenditures: Mainline$571 $734 $608Horizon389 292 70Consolidated$960 $1,026 $678 Total assets at end of period: Mainline$16,853 $16,663 Horizon1,229 929 Consolidating & Other(7,170) (6,846) Consolidated$10,912 $10,746 | |||||
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