Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2021 | Jan. 31, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Transition Report | false | ||
Entity File Number | 1-8957 | ||
Entity Registrant Name | ALASKA AIR GROUP, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 91-1292054 | ||
Entity Address, Address Line One | 19300 International Boulevard | ||
Entity Address, City or Town | Seattle | ||
Entity Address, State or Province | WA | ||
Entity Address, Postal Zip Code | 98188 | ||
City Area Code | 206 | ||
Local Phone Number | 392-5040 | ||
Title of 12(b) Security | Common Stock, $0.01 Par Value | ||
Trading Symbol | ALK | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 125,912,426 | ||
Entity Public Float | $ 7.5 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2021 | ||
Entity Central Index Key | 0000766421 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --12-31 | ||
ICFR Auditor Attestation Flag | true | ||
Security Exchange Name | NYSE | ||
Document Information [Line Items] | |||
Auditor Firm ID | 185 | ||
Auditor Location | Seattle, WA | ||
Auditor Name | KPMG LLP |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Revenues | |||
Total Operating Revenues | $ 6,176 | $ 3,566 | $ 8,781 |
Operating Expenses | |||
Wages and benefits | 2,218 | 2,053 | 2,370 |
Payroll Support Program Grant Recognized | (914) | (782) | 0 |
Variable incentive pay | 151 | 130 | 163 |
Aircraft fuel, including hedging gains and losses | 1,279 | 723 | 1,878 |
Aircraft maintenance | 364 | 321 | 437 |
Aircraft rent | 254 | 299 | 331 |
Landing fees and other rentals | 555 | 417 | 531 |
Contracted services | 235 | 181 | 289 |
Selling expense | 173 | 101 | 313 |
Depreciation and amortization | 394 | 420 | 423 |
Cost of Services, Catering | 139 | 90 | 214 |
Third-party regional carrier expense | 147 | 128 | 166 |
Other operating expenses | 507 | 407 | 559 |
Special Items - Impairment charges and other | (1) | 627 | 0 |
Restructuring Charges | (10) | 220 | 0 |
Special items - merger-related costs | 0 | 6 | 44 |
Total Operating Expenses | 5,491 | 5,341 | 7,718 |
Operating Income (Loss) | 685 | (1,775) | 1,063 |
Non-operating Income (Expense) | |||
Interest income | 25 | 31 | 42 |
Interest expense | (128) | (98) | (78) |
Interest capitalized | 11 | 11 | 15 |
Special Items - Net non-operating | 0 | (26) | 0 |
Other - net | 36 | 17 | (26) |
Nonoperating Income (Expense) Total | (56) | (65) | (47) |
Income before income tax | 629 | (1,840) | 1,016 |
Income Tax Expense, Before Tax Cuts and Jobs Act of 2017 | 151 | (516) | 247 |
Income tax (benefit) expense | 151 | (516) | 247 |
Net Income (Loss) | $ 478 | $ (1,324) | $ 769 |
Basic earnings per share | $ 3.82 | $ (10.72) | $ 6.24 |
Diluted earnings per share | $ 3.77 | $ (10.72) | $ 6.19 |
Shares used for computation: | |||
Basic | 125,063 | 123,450 | 123,279 |
Diluted | 126,775 | 123,450 | 124,289 |
Mileage Plan Services, Other [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 461 | $ 374 | $ 465 |
Cargo and Freight [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 216 | 173 | 221 |
Passenger Revenue [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 5,499 | 3,019 | 8,095 |
Passenger Revenue [Member] | Passenger [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 5,499 | 3,019 | 8,095 |
Mileage Plan Revenue [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,100 | 720 | 1,169 |
Mileage Plan Revenue [Member] | Passenger [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 639 | 346 | 704 |
Mileage Plan Revenue [Member] | Mileage Plan Services, Other [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 461 | 374 | 465 |
Cargo and Other Revenue [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 216 | 173 | 221 |
Cargo and Other Revenue [Member] | Cargo and Freight [Member] | |||
Operating Revenues | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 216 | $ 173 | $ 221 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and cash equivalents | $ 470 | $ 1,370 |
Marketable securities | 2,646 | 1,976 |
Total cash and marketable securities | 3,116 | 3,346 |
Receivables - net | 546 | 480 |
Inventories and supplies - net | 62 | 57 |
Prepaid expenses and other current assets | 196 | 123 |
Total Current Assets | 3,920 | 4,006 |
Property and Equipment | ||
Aircraft and other flight equipment | 8,127 | 7,761 |
Other property and equipment | 1,489 | 1,398 |
Deposits for future flight equipment | 384 | 583 |
Property and Equipment | 10,000 | 9,742 |
Less accumulated depreciation and amortization | 3,862 | 3,531 |
Total Property and Equipment - Net | 6,138 | 6,211 |
Other Assets | ||
Operating Lease, Right-of-Use Asset | 1,453 | 1,400 |
Goodwill and intangible assets | 2,044 | 2,050 |
Other noncurrent assets | 396 | 379 |
Total Other Assets | 3,893 | 3,829 |
Total Assets | 13,951 | 14,046 |
Current Liabilities | ||
Accounts payable | 200 | 108 |
Accrued wages, vacation and payroll taxes | 457 | 527 |
Other accrued liabilities | 625 | 424 |
Operating Lease, Liability, Current | 268 | 290 |
Current portion of long-term debt | 366 | 1,138 |
Total Current Liabilities | 3,991 | 4,293 |
Long-Term Debt, Net of Current Portion | 2,173 | 2,357 |
Other Liabilities and Credits | ||
Operating Lease, Liability, Noncurrent | 1,279 | 1,268 |
Deferred Income Tax Liabilities, Net | 578 | 407 |
Deferred revenue | 1,446 | 1,544 |
Obligation for pension and postretirement medical benefits | 305 | 665 |
Other liabilities | 378 | 524 |
Total Other Liabilities and Credits | 3,986 | 4,408 |
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: 2021 - 135,255,808 shares; 2020 - 133,567,534 shares, Outstanding: 2021 - 125,905,864 shares; 2020 - 124,217,590 shares | 1 | 1 |
Capital in excess of par value | 494 | 391 |
Treasury stock (common), at cost: 2021 - 9,349,944 shares; 2020 - 9,349,944 shares | (674) | (674) |
Accumulated other comprehensive loss | (262) | (494) |
Retained earnings | 4,242 | 3,764 |
Shareholders' Equity Total | 3,801 | 2,988 |
Total Liabilities and Shareholders' Equity | $ 13,951 | 14,046 |
Common stock, shares authorized | 400,000,000 | |
Common stock, par value | $ 0.01 | |
Air Traffic Liability | ||
Current Liabilities | ||
Air traffic liability | $ 1,163 | 1,073 |
Mileage Plan Revenue [Member] | ||
Current Liabilities | ||
Air traffic liability | $ 912 | $ 733 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Dec. 31, 2020 |
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 | |
Common stock, shares authorized | 400,000,000 | |
Common stock, shares issued | 135,255,808 | 133,567,534 |
Common stock, shares, outstanding | 125,905,864 | 124,217,590 |
Treasury stock, shares | 9,349,944 | 9,349,944 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATIONS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Net Income (Loss) | $ 478 | $ (1,324) | $ 769 |
Related to marketable securities: | |||
Unrealized holding gains (losses) arising during the period | (30) | 33 | 31 |
Reclassification of (gains) into Other-net non-operating income (expense) | (6) | (14) | (5) |
Income tax benefit (expense) | 9 | (5) | (6) |
Marketable securities, net of tax | (27) | 14 | 20 |
Related to employee benefit plans: | |||
Actuarial gains (losses) related to pension and other post-retirement benefit plans | 294 | (69) | (71) |
Reclassification of net pension expense into Wages and benefits and Other-net non-operating income | 33 | 30 | 32 |
Income tax benefit (expense) | (81) | 10 | 10 |
Employee benefit plans, net of tax | 246 | (29) | (29) |
Related to interest rate derivative instruments: | |||
Unrealized holding gains (losses) arising during the period | 17 | (21) | (13) |
Reclassification of losses into Aircraft rent | 0 | 3 | 3 |
Income tax benefit (expense) | (4) | 4 | 2 |
Interest rate derivative instruments, net of tax | 13 | (14) | (8) |
Other comprehensive income (loss) | 232 | (29) | (17) |
Comprehensive income | $ 710 | $ (1,353) | $ 752 |
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, 2018 | $ 3,751 | $ 1 | $ 232 | $ (568) | $ (448) | $ 4,534 |
Common Stock Outstanding at Dec. 31, 2018 | 123,194,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Impact of Adoption of ASC 842 | 3 | 0 | 3 | |||
Net Income (Loss) | 769 | 769 | ||||
Other comprehensive income (loss) | $ (17) | (17) | ||||
Common stock repurchase (in shares) | (1,192,820) | (1,193,000) | ||||
Common stock repurchase | $ (75) | 0 | (75) | |||
Stock-based compensation | 36 | 36 | ||||
Cash dividend declared ($1.40 per share) | (173) | (173) | ||||
Stock issued for employee stock purchase plan (in shares) | 785,000 | |||||
Stock issued for employee stock purchase plan | 40 | 40 | ||||
Stock issued under stock plans (in shares) | 214,000 | |||||
Stock issued under stock plans | (3) | (3) | ||||
Stockholders' Equity at Dec. 31, 2019 | 4,331 | $ 1 | 305 | (643) | (465) | 5,133 |
Common Stock Outstanding at Dec. 31, 2019 | 123,000,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income (Loss) | (1,324) | (1,324) | ||||
Other comprehensive income (loss) | $ (29) | (29) | ||||
Common stock repurchase (in shares) | (538,078) | (538,000) | ||||
Common stock repurchase | $ (31) | 0 | (31) | |||
Stock-based compensation | 34 | 34 | ||||
Cash dividend declared ($1.40 per share) | (45) | (45) | ||||
Stock issued for employee stock purchase plan (in shares) | 1,524,000 | |||||
Stock issued for employee stock purchase plan | 41 | 41 | ||||
Stock issued under stock plans (in shares) | 231,000 | |||||
Stock issued under stock plans | (3) | (3) | ||||
Stockholders' Equity at Dec. 31, 2020 | $ 2,988 | $ 1 | 391 | (674) | (494) | 3,764 |
Common Stock Outstanding at Dec. 31, 2020 | 124,217,590 | 124,217,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net Income (Loss) | $ 478 | 478 | ||||
Other comprehensive income (loss) | 232 | 232 | ||||
Stock-based compensation | 44 | 44 | ||||
Adjustments to Additional Paid in Capital, Warrant Issued | 16 | 16 | ||||
Stock issued for employee stock purchase plan (in shares) | 1,255,000 | |||||
Stock issued for employee stock purchase plan | 48 | 48 | ||||
Stock issued under stock plans (in shares) | 424,000 | |||||
Stock issued under stock plans | (5) | (5) | ||||
Stockholders' Equity at Dec. 31, 2021 | $ 3,801 | $ 1 | $ 494 | $ (674) | $ (262) | $ 4,242 |
Common Stock Outstanding at Dec. 31, 2021 | 125,905,864 | 125,906,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | |||
Net Income (Loss) | $ 478 | $ (1,324) | $ 769 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 394 | 420 | 423 |
Stock-based compensation and other | 51 | 24 | 29 |
Special Items - Impairment charges and other | (1) | 627 | 0 |
Restructuring Charges | (10) | 220 | 0 |
Changes in certain assets and liabilities: | |||
Changes in deferred tax provision | 104 | (300) | 209 |
(Increase) decrease in accounts receivable | (66) | (160) | 43 |
Increase in air traffic liability | 90 | 173 | 112 |
Increase in deferred revenue | 81 | 288 | 116 |
Pension contribution | (100) | 0 | (65) |
Other - net | 9 | (202) | 86 |
Net cash provided by (used in) operating activities | 1,030 | (234) | 1,722 |
Property and equipment additions: | |||
Aircraft and aircraft purchase deposits | (68) | (64) | (356) |
Other flight equipment | (126) | (55) | (178) |
Other property and equipment | (98) | (103) | (162) |
Total property and equipment additions | (292) | (222) | (696) |
Purchases of marketable securities | (4,301) | (2,962) | (1,810) |
Sales and maturities of marketable securities | 3,595 | 2,318 | 1,674 |
Proceeds from Sale of Productive Assets | 2 | 279 | 28 |
Other investing activities | (12) | (6) | 13 |
Net cash used in investing activities | (1,008) | (593) | (791) |
Cash flows from financing activities: | |||
Proceeds from issuance of long-term debt, net of issuance costs | 363 | 2,564 | 450 |
Long-term debt payments | (1,334) | (565) | (1,058) |
Common stock repurchases | 0 | (31) | (75) |
Cash dividend paid | 0 | (45) | (173) |
Other financing activities | 57 | 58 | 43 |
Net cash provided by (used in) financing activities | (914) | 1,981 | (813) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | (892) | 1,154 | 118 |
Cash, cash equivalents, and restricted cash at beginning of year | 1,386 | 232 | 114 |
Cash, cash equivalents, and restricted cash at end of year | 494 | 1,386 | 232 |
Cash paid during the year for: | |||
Interest, net of amount capitalized | 109 | 50 | 60 |
Income taxes, net of refunds received | $ 48 | $ 0 | $ 31 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Reconciliation of cash, cash equivalents, and restricted cash: | |||
Cash and cash equivalents | $ 470 | $ 1,370 | $ 221 |
Restricted Cash and Investments, Current | 24 | 16 | 11 |
Total cash, cash equivalents, and restricted cash at end of the period | $ 494 | $ 1,386 | $ 232 |
GENERAL AND SUMMARY OF SIGNIFIC
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING | 12 Months Ended |
Dec. 31, 2021 | |
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 Alaska Air Group (Air Group, or the Company), and its primary subsidiaries, Alaska Airlines, Inc. (Alaska) and Horizon Air Industries, Inc. (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 (GAAP) 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 $7 million and $5 million at December 31, 2021 and 2020, 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 are reflected in accumulated other comprehensive loss (AOCL). The Company evaluates the investment portfolio on a quarterly basis for expected credit losses. The Company uses a systematic methodology that groups assets by relevant market sector, and considers available quantitative and qualitative evidence in evaluating potential allowances for credit losses. 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 the result of an expected credit loss, an allowance is recorded to Other—net in the consolidated statements of operations. Receivables—net Receivables primarily consist of amounts due from taxing authorities, credit card processors, and the Company's affinity card partner stemming from income tax returns, sales of tickets to customers and bank purchased miles. Given the nature of these receivables, reserves are immaterial to the overall balance. 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 $49 million and $46 million at December 31, 2021 and 2020. Removals from the reserve in 2021 were immaterial. Inventory and supplies — net also includes fuel inventory of $21 million and $15 million at December 31, 2021 and 2020. 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 and E175 aircraft 20 to 25 years 10% Bombardier Q400 aircraft 15 years 5% Buildings 25 to 40 years 10% Minor building and land improvements 10 years —% Capitalized leases and leasehold improvements Generally shorter of lease term or —% Computer hardware and software 3 to 10 years —% Other furniture and equipment 5 to 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. 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. Beginning in 2022, maintenance on owned E175 aircraft will also be covered under a power-by-the-hour agreement with a third party. For these agreements, 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 . For these purposes, the fair value is estimated using a combination of Level 2 inputs, including published market value estimates for the assets being assessed, and Level 3 inputs, including Company-specific and asset-specific indicators. 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 the fourth quarter, or more frequently if events or circumstances indicate than an impairment may exist. The assessment utilizes either a qualitative or quantitative approach. The qualitative approach considers factors such as Alaska Air Group market capitalization and other market trends, and unobservable inputs, including Company specific cash flow and performance information. If it is determined that it is more likely than not that the asset may be impaired, management utilizes a quantitative approach to assess the asset's fair value and the amount of impairment and a charge may be recorded. In 2021, the fair value of the Mainline reporting unit substantially exceeded its carrying value. Intangible Assets Intangible assets are comprised primarily of indefinite-lived airport slots and finite-lived customer relationships recorded in conjunction with the acquisition of Virgin America. Finite-lived intangibles were recorded at fair value upon acquisition and are amortized over their estimated useful lives. Indefinite-lived intangibles were recorded at fair value upon acquisition and are not amortized, but are tested at least annually for impairment using a similar methodology to goodwill, as described above. 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. The Company establishes accounting maintenance deposits as assets on the balance sheet using estimates of the anticipated timing and cost of the specific major maintenance events, such that the accounting deposits do not exceed the amount qualified for reimbursement. Aircraft maintenance deposits recorded on the consolidated balance sheets were $175 million and $242 million as of December 31, 2021 and December 31, 2020. Leased Aircraft Return Costs Costs of returning leased aircraft are accrued when the costs are probable and reasonably estimable, usually beginning at least twelve months prior to the lease return, unless a determination is made that the leased asset is removed from operation. If the leased aircraft is removed from the operating fleet, the estimated cost of return is accrued at the time of removal. 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, payments made reduce the outstanding lease return liability. Of the total outstanding liability, $53 million is included in Other accrued liabilities and $114 million is included in Other liabilities on the consolidated balance sheets as of December 31, 2021, compared to $54 million included in Other accrued liabilities and $246 million included in Other liabilities on the consolidated balance sheets as of December 31, 2020 . Expense associated with lease returns in the standard course of operating the aircraft is included in Aircraft maintenance in the consolidated statements of operations. Expense associated with lease returns when aircraft are permanently parked is recorded as a charge at the date the aircraft is permanently parked, regardless of contractual return date, and is classified as Special items - impairment charges and other in the consolidated statements of operations. See Note 2 for further discussion of these special items. Advertising Expenses The Company's advertising expenses include advertising, sponsorship and promotional costs. Advertising production costs are expensed as incurred. Advertising expense was $63 million, $41 million and $72 million during the years ended December 31, 2021, 2020 and 2019. 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, including property, plant and equipment, goodwill, intangible assets and certain other 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. The leveling of inputs for financial and non-financial instruments are disclosed in this note, and 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, 2021, 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. See Note 8 to the consolidated financial statements for more discussion of income taxes. Stock-Based Compensation Accounting standards require companies to recognize expense over the service period based on the fair value of stock options and other equity-based compensation issued to employees estimated 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 2021 anti-dilutive stock options excluded from the calculation of EPS were not material. Recently Adopted Accounting Pronouncements In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848)," which provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting to ease the financial reporting burden related to the expected market transition from LIBOR to alternative reference rates. In January 2021, the FASB updated Topic 848, providing additional clarification and scope relating to transition to alternative reference rates. The guidance was effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2022. The Company is not expected to transition to alternative rates prior to fiscal year 2023. The Company does not expect adoption and transition to alternative reference rates will have a material impact on our consolidated financial statements. |
COVID-19 Pandemic
COVID-19 Pandemic | 12 Months Ended |
Dec. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Impacts of COVID-19 | The public health and economic crisis resulting from the outbreak of COVID-19 in 2020 continues to have a significant impact on the Company. Although the relaxation of restrictions by state and local governments and the rollout of vaccination programs have allowed for the return of demand, passenger enplanements remain below pre-pandemic levels and variants continue to drive volatility in recovery. As a result, the Company continues to fly less capacity than it had pre-pandemic. Beginning in 2020, the Company implemented various cost-saving initiatives, including permanently parking aircraft, restructuring the workforce through early-out and incentive leave programs, and obtaining funding available under programs offered by the Treasury. As demand has improved and the business has grown back toward pre-pandemic flying levels, these programs have been adjusted to meet the needs of the airlines. The impacts of these programs for the years ended December 31, 2021 and 2020 are described further below. Lease Return Costs Alaska removed 40 leased Airbus aircraft from operating service in 2020, and recorded an estimate of the expected future lease return costs for the aircraft of $209 million to Special items - impairment charges and other in the consolidated statements of operations. In 2021, the Company recorded a net benefit of $1 million associated with changes in these estimates. Lease return costs also include the write off of associated maintenance deposits when the Company no longer expects to perform maintenance events covered by those deposits. The Company continues to evaluate the estimated costs to return leased aircraft. The lease return cost estimates are based on the Company's best estimate of costs to return aircraft as of the date of this filing. In 2021, Alaska initiated a plan to reactivate up to 12 previously parked Airbus aircraft to support Alaska's plan for restoring capacity to pre-pandemic levels by summer 2022. Nine of these reactivated aircraft returned to the operating fleet in 2021, with three more expected to be reactivated in early 2022. The Company currently anticipates all twelve aircraft temporarily returned to service will be removed again from operating service by the end of 2023. At this time, the Company does not anticipate the return to service of these aircraft will materially change estimated lease return costs previously recorded, as leases for aircraft returning to service generally expire within a near-term window. Workforce restructuring The Company's subsidiaries reduced their operating workforce in 2020 to better align with the expected size of the business. To mitigate the need for involuntary furloughs, various early-out and voluntary leave programs were made available to all frontline work groups, in addition to incentive leave programs made available to Alaska pilots and mechanics. Through these programs over 600 employees took permanent early-outs, and over 3,300 employees took voluntary or incentive leaves. All employees on these temporary leave programs were called back to work by October 1, 2021. In 2020, as a result of these programs, the Company recorded $220 million in wage expense to Special items - restructuring charges in the consolidated statement of operations for those pilots and mechanics on incentive leaves, ongoing medical benefit coverage and lump-sum termination payments. Throughout 2021, the Company continued to refine and update capacity expectations and training schedules, which resulted in changes to anticipated leave lengths. As a result, the Company recorded a net benefit of $10 million during the year ended December 31, 2021. The table below presents a roll forward of the outstanding voluntary leave liability (in millions): Twelve Months Ended Total voluntary leave liability balance at January 1 $ 127 Cash payments (105) Charges and adjustments (10) Total voluntary leave liability balance at December 31 $ 12 The outstanding accrual at December 31, 2021 is for final payments to participants on a retirement incentive leave who will not return to active employment. The balance is reflected in accrued wages, benefits and payroll taxes on the consolidated balance sheet. Impairment charges In 2020, the Company temporarily and permanently parked certain aircraft in response to the loss of demand driven by the COVID-19 pandemic. At that time, the Company performed impairment tests on certain long-lived and intangible assets, as well as receivable balances to evaluate recoverability. These impairment tests indicated impairment on the Q400 fleet, permanently parked Airbus aircraft, and related capital improvements, resulting in impairment charges of $363 million. The Company also identified certain intangible assets, purchase deposits, and receivable balances deemed unrecoverable, and recorded an additional $30 million in charges for those balances. The total of these special charges, lease return costs summarized above, the recognition of a legal settlement and other immaterial charges comprise the $627 million recorded as Special items - impairment charges and other on the consolidated statement of operations for the period ending December 31, 2020. In 2021, the Company did not identify any indicators of impairment of long-lived assets, goodwill, intangibles or receivables. CARES Act Funding In 2020, Alaska, Horizon, and McGee finalized agreements with the Treasury through the Payroll Support Program (PSP) under the Coronavirus Aid, Relief and Economic Security (CARES) Act, made available under the Consolidated Appropriations Act, 2020 (PSP 1). Under PSP 1 and associated agreements, Alaska, Horizon, and McGee received total funds of approximately $1.1 billion in 2020. In 2021, Alaska, Horizon and McGee finalized agreements with the Treasury through an extension of the PSP, made available under the Consolidated Appropriations Act, 2021 (PSP 2) and received an additional $626 million. Alaska, Horizon and McGee also finalized additional agreements with the Treasury under a third round of the PSP, made available under the American Rescue Plan of 2021 (PSP 3), and received total funds of $585 million. Total funds contracted from the Treasury under the Payroll Support Programs are allocated as follows (in millions): Grants Loans Warrants Total Proceeds PSP 1 $ 757 $ 293 $ 9 $ 1,059 PSP 2 457 160 9 626 PSP 3 431 147 7 585 Total $ 1,645 $ 600 $ 25 $ 2,270 Funds were exclusively used for payment of employee salaries, wages and benefits. In 2021 and 2020, $892 million and $753 million in PSP grant funds were recorded as an offset to wages, salaries and benefits as eligible expenses were incurred. Also included within the annual total offset are employee retention credits as provided for in the CARES Act of $21 million in 2021 and $29 million in 2020. The Company does not expect to record additional wage offsets in 2022. |
REVENUE FROM CONTRACTS WITH CUS
REVENUE FROM CONTRACTS WITH CUSTOMERS (Notes) | 12 Months Ended |
Dec. 31, 2021 | |
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. In 2020, the Company eliminated ticket change fees indefinitely from main cabin and first class fares. 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 consolidated 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 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 (prior to 2021), 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 intended travel 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. Differences between advance passenger ticket breakage estimates and actual expirations are recognized as revenue when changes to estimate assumptions are observed or when tickets are no longer valid. 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, 2021 2020 2019 Passenger ticket revenue, including ticket breakage and net of taxes and fees $ 4,533 $ 2,428 $ 6,824 Passenger ancillary revenue 327 245 567 Mileage Plan passenger revenue 639 346 704 Total Passenger revenue $ 5,499 $ 3,019 $ 8,095 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 $167 million and $83 million on the consolidated balance sheets as of December 31, 2021 and 2020. 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. In response to the COVID-19 pandemic, the Company suspended expiry of outstanding mileage credits through June 30, 2022. 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 23 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, 2021 and 2020 was 17.4%. The Company reviews the breakage rate used on an annual basis. Co-brand credit card agreements and other In addition to mileage credits, the co-brand credit card agreements, referred to herein as the Agreements, also include 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 co-brand card bank partners are 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 banks 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 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. The travel performance obligation is deferred until the transportation is provided in the amount of the estimated standalone selling price of the ticket, less breakage, and the brand performance obligation is recognized using the residual method as commission revenue when the brand element is sold. Mileage credit sales recorded under the residual approach are immaterial to the overall program. Partner airline 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 is netted against 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, 2021 2020 2019 Passenger revenue $ 639 $ 346 $ 704 Mileage Plan other revenue 461 374 465 Total Mileage Plan revenue $ 1,100 $ 720 $ 1,169 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, 2021 2020 2019 Cargo revenue $ 124 $ 112 $ 133 Other revenue 92 61 88 Total Cargo and other revenue $ 216 $ 173 $ 221 Air Traffic Liability and Deferred Revenue Passenger ticket and ancillary services liabilities The Company recognized Passenger revenue of $703 million and $502 million from the 2020 and 2019 year-end air traffic liability balance during the twelve months ended December 31, 2021 and 2020. Included within the air traffic liability on the consolidated balance sheets is an outstanding liability for travel credits that guests may utilize for future travel. A high volume of credits were issued in 2020 as a result of the COVID-19 pandemic, and issuance levels in 2021 normalized, though remain above pre-pandemic levels. In April 2021, as part of the Company's COVID-19 relief measures, travel credits that were set to expire at any point in 2021 were extended through December 31, 2021 for possible travel through November 30, 2022. Of these credits, those not redeemed for travel by December 31, 2021 expired and were recognized as revenue in 2021. Mileage Plan liabilities The total deferred revenue liability included on the consolidated balance sheets represents the remaining transaction price that has been allocated to Mileage Plan 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 $62 million and $48 million of such receivables as of December 31, 2021 and December 31, 2020. 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, 2021 2020 Total Deferred Revenue balance at January 1 $ 2,277 $ 1,990 Travel miles and companion certificate redemption - Passenger revenue (639) (346) Miles redeemed on partner airlines - Other revenue (43) (23) Increase in liability for mileage credits issued 763 656 Total Deferred Revenue balance at December 31 $ 2,358 $ 2,277 Selling Costs Certain costs such as credit card fees, travel agency and other commissions paid, as well as Global Distribution Systems 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 $37 million and $24 million as of December 31, 2021 and December 31, 2020. The Company recorded related expense on the consolidated statements of operations of $90 million, $43 million and $208 million for the twelve months ended December 31, 2021, 2020 and 2019. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 12 Months Ended |
Dec. 31, 2021 | |
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, 2021, the Company had outstanding fuel hedge contracts covering approximately 425 million gallons of crude oil that will be settled from January 2022 to June 2023. Interest Rate Swap Agreements The Company is exposed to market risk from adverse changes in variable interest rates on long-term debt. To manage this risk, the Company periodically enters into interest rate swap agreements. As of December 31, 2021, the Company has 12 interest rate swap agreements with third parties designed to hedge the volatility of the underlying variable interest rates on $469 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. 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): 2021 2020 Fuel hedge contracts (not designated as hedges) Prepaid expenses and other current assets $ 71 $ 11 Other assets 10 4 Interest rate swaps (designated as hedges) Other accrued liabilities (6) (10) Other liabilities (3) (15) Gains (losses) in accumulated other comprehensive loss (AOCL) 17 (21) The net cash received from settlements offset by cash paid for new fuel hedge positions was $38 million during 2021, compared to net cash paid of $14 million and $19 million during 2020 and 2019. Pretax effect of derivative instruments on earnings and AOCL (in millions): 2021 2020 2019 Fuel hedge contracts (not designated as hedges) Gains (losses) recognized in Aircraft fuel $ 104 $ (10) $ (10) Interest rate swaps (designated as hedges) Losses recognized in Aircraft rent — (3) (3) Gains (losses) recognized in other comprehensive income (OCI) 17 (21) (13) 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. Losses related to interest rate swaps on variable rate debt of $10 million were recognized in interest expense during 2021. The amounts shown as recognized in OCI are prior to the losses recognized in aircraft rent during the period. The Company expects to reclassify from OCI $6 million in interest expense within the next twelve months. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS In determining fair value, there is a three-level hierarchy based on the reliability of the inputs used. Level 1 refers to fair values based on quoted prices in active markets for identical assets or liabilities. Level 2 refers to fair values estimated using significant other observable inputs and Level 3 refers to fair values estimated using significant unobservable inputs. Fair Value of Financial Instruments on a Recurring Basis As of December 31, 2021, total cost basis for marketable securities was $2.6 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, 2021 December 31, 2020 Level 1 Level 2 Total Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 331 $ — $ 331 $ 407 $ — $ 407 Equity mutual funds 6 — 6 7 — 7 Foreign government bonds — 38 38 — 20 20 Asset-backed securities — 311 311 — 224 224 Mortgage-backed securities — 232 232 — 290 290 Corporate notes and bonds — 1,663 1,663 — 978 978 Municipal securities — 65 65 — 50 50 Total Marketable securities 337 2,309 2,646 414 1,562 1,976 Derivative instruments Fuel hedge contracts - call options — 81 81 — 15 15 Total Assets $ 337 $ 2,390 $ 2,727 $ 414 $ 1,577 $ 1,991 Liabilities Derivative instruments Interest rate swap agreements — (9) (9) — (25) (25) Total Liabilities $ — $ (9) $ (9) $ — $ (25) $ (25) The Company uses the market and income approach to determine the fair value of marketable securities. U.S. government securities and equity mutual funds 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 unrealized losses are the result of expected credit losses based on the Company's evaluation of available evidence as of December 31, 2021. Proceeds from sales of marketable securities were $3.6 billion, $2.3 billion and $1.7 billion in 2021, 2020, and 2019. Maturities for marketable securities (in millions): December 31, 2021 Cost Basis Fair Value Due in one year or less $ 1,064 $ 1,065 Due after one year through five years 1,537 1,532 Due after five years 44 42 Total $ 2,645 $ 2,639 As of December 31, 2021, $6 million of total marketable securities do not have a maturity date and are therefore excluded from the total fair value of maturities for marketable securities above. Fair Value of Other Financial Instruments The Company uses the following methods and assumptions to determine the fair value of financial instruments that are not recognized at fair value as described below. Cash, Cash Equivalents, and Restricted Cash: 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 fair value. The Company's restricted cash balances are primarily used to guarantee various letters of credit, self-insurance programs or other contractual rights. Restricted cash consists of highly liquid securities with original maturities of three months or less. They are carried at cost, which approximates fair value. Debt : To estimate the fair value of all fixed-rate debt as of December 31, 2021, the Company uses the income approach by discounting cash flows or estimation using quoted market prices, utilizing borrowing rates for comparable debt over the remaining life of the outstanding debt. The estimated fair value of the fixed-rate Enhanced Equipment Trust Certificate debt is Level 2, as it is estimated using observable inputs, while the estimated fair value of $763 million of other fixed-rate debt, including PSP notes payable, is classified as Level 3, as it is not actively traded and is valued using discounted cash flows which is an unobservable input. Fixed-rate debt on the consolidated balance sheet and the estimated fair value of long-term fixed-rate debt (in millions): December 31, 2021 December 31, 2020 Total fixed rate debt $ 1,821 $ 1,662 Estimated fair value $ 1,919 $ 1,778 |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt obligations on the consolidated balance sheet (in millions): 2021 2020 Fixed-rate notes payable due through 2029 $ 163 $ 198 Fixed-rate PSP note payable due through 2031 600 290 Fixed-rate EETC payable due through 2025 & 2027 1,058 1,174 Variable-rate notes payable due through 2029 738 1,866 Less debt issuance costs and unamortized debt discount (20) (33) Total debt 2,539 3,495 Less current portion 366 1,138 Long-term debt, less current portion $ 2,173 $ 2,357 Weighted-average fixed-interest rate 3.7 % 4.3 % Weighted-average variable-interest rate 1.3 % 1.9 % Approximately $469 million of the Company's total variable-rate notes payable are effectively fixed via interest rate swaps at December 31, 2021, bringing the weighted-average interest rate for the full debt portfolio to 3.3%. During 2021, the Company's total debt decreased $956 million, the result of payments of $1.3 billion, including $923 million in prepayments. Payments were offset by issuances of $363 million, including $311 million of unsecured loans from the PSP and $54 million in proceeds from issuance of debt. CARES Act Loan In 2020, the Company finalized an agreement with the Treasury to obtain up to $1.9 billion via a secured term loan facility. In 2020, the Company drew $135 million under the agreement, which was used for general corporate purposes and certain operating expenses in accordance with the terms and conditions of the loan agreement and the applicable provisions of the CARES Act. The full balance was repaid in the second quarter of 2021. In accordance with the related agreement, the facility terminated at the time of repayment. Debt Maturity At December 31, 2021, long-term debt principal payments for the next five years and thereafter are as follows (in millions): Total 2022 $ 371 2023 334 2024 240 2025 261 2026 176 Thereafter 1,177 Total principal payments $ 2,559 Bank Lines of Credit Alaska has three credit facilities totaling $486 million as of December 31, 2021. One of the credit facilities for $150 million expires in March 2025 and is secured by certain accounts receivable, spare engines, spare parts and ground service equipment. A second credit facility for $250 million expires in June 2024 and is secured by aircraft. Both facilities have variable interest rates based on LIBOR plus a specified margin. A third credit facility for $86 million expires in June 2022 and is secured by aircraft. Alaska has secured letters of credit against the third facility, but has no plans to borrow using either of the two facilities. All credit facilities have a requirement to maintain a minimum unrestricted cash and marketable securities balance of $500 million. Alaska was in compliance with this covenant at December 31, 2021. |
Leases, Codification Topic 842
Leases, Codification Topic 842 | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Lessee, Operating Leases | LEASES The Company leases property and equipment through operating leases and categorizes these leases into five asset classes: aircraft, capacity purchase arrangements for aircraft operated by third-party carriers (CPA aircraft), airport and terminal facilities, corporate real estate and other equipment. All capitalized lease assets have been recorded on the consolidated balance sheet as of December 31, 2021 as Operating lease assets, with the corresponding liabilities recorded as Operating lease liabilities. Operating rent expense is recognized on a straight-line basis over the term of the lease. The Company has elected the practical expedient under ASC 842 - Leases, allowing a policy election to exclude from recognition short-term lease assets and lease liabilities for leases with an initial term of twelve months or less. Such expense was not material for the twelve months ended December 31, 2021, 2020, and 2019. Operating lease assets balance by asset class was as follows (in millions): December 31, 2021 December 31, 2020 Aircraft $ 782 $ 750 CPA Aircraft 600 579 Airport and terminal facilities 16 16 Corporate real estate and other 55 55 Total Operating lease assets $ 1,453 $ 1,400 Aircraft At December 31, 2021, Alaska had operating leases for ten Boeing 737-800, five Boeing 737-9, and 61 Airbus aircraft, and Horizon had operating leases for seven Bombardier Q400 aircraft. Remaining lease terms for these aircraft extend up to 12 years, some with options to extend, subject to negotiation at the end of the term. As extension is not certain, and rates are highly likely to be renegotiated, the extended term is only capitalized when it is reasonably determinable. While aircraft rent is primarily fixed, certain leases contain rental adjustments throughout the lease term which would be recognized as variable expense as incurred. Variable lease expense for aircraft for the twelve months ended December 31, 2021, 2020, and 2019 was $5 million, $1 million, and $4 million. Capacity purchase agreements with aircraft (CPA aircraft) At December 31, 2021, Alaska had CPAs with two carriers, including the Company’s wholly-owned subsidiary, Horizon. Horizon sells 100% of its capacity under a CPA with Alaska. Alaska also has a CPA with SkyWest covering 32 E175 aircraft to fly certain routes in the Lower 48 and Canada. 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. As Horizon is a wholly-owned subsidiary, intercompany leases between Alaska and Horizon have not been recognized under the standard. Remaining lease terms for CPA aircraft extend up to nine years. Financial arrangements of the CPAs include a fixed component, representing the costs to operate each aircraft which is capitalized. CPAs also include variable rent based on actual levels of flying, which is expensed as incurred. Variable lease expense for CPA aircraft for the twelve months ended December 31, 2021, 2020, and 2019 was not material. Airport and terminal facilities The Company leases ticket counters, gates, cargo and baggage space, office space and other support areas at numerous airports. For this asset class, the Company has elected to combine lease and non-lease components. The majority of airport and terminal facility leases are not capitalized because they do not meet the definition of controlled assets under the standard, or because the lease payments are entirely variable. For airports where leased assets are identified, and where the contract includes fixed lease payments, operating lease assets and lease liabilities have been recorded. The Company is also commonly responsible for maintenance, insurance and other facility-related expenses and services under these agreements. These costs are recognized as variable expense in the period incurred. Airport and terminal facilities variable lease expense for the twelve months ended December 31, 2021, 2020, and 2019 was $377 million, $286 million, and $322 million. Starting in 2018, the Company leased twelve airport slots at LaGuardia Airport and eight airport slots at Reagan National Airport to a third party. For these leases, the Company recorded $16 million, $14 million, and $13 million of lease income during the twelve months ended December 31, 2021, 2020, and 2019. Corporate real estate and other leases Leased corporate real estate is primarily for office space in hub cities, data centers, land leases, and reservation centers. For this asset class, the Company has elected to combine lease and non-lease components under the standard. Other leased assets are comprised of other ancillary contracts and items including leased flight simulators, ground equipment, and spare engines. Variable lease expense related to corporate real estate and other leases for the twelve months ended December 31, 2021, 2020, and 2019 was $17 million, $12 million, and $10 million. Sale-leaseback transaction In 2020, Alaska entered into a transaction to sell ten owned Airbus A320 aircraft and replace those aircraft with 13 new leased Boeing 737-9 aircraft. Also included in the transaction is the leaseback of all ten Airbus aircraft in the interim period between the sale of those aircraft and delivery of the first ten 737-9 aircraft. Of these deliveries, five were received in 2021, with the remaining eight scheduled in 2022. Components of Lease Expense The impact of leases, including variable lease cost, was as follows (in millions): Classification 2021 2020 2019 Expense Aircraft Aircraft rent $ 174 $ 215 $ 246 CPA Aircraft Aircraft rent 80 80 79 Airport and terminal facilities Landing fees and other rentals 379 288 324 Corporate real estate and other Landing fees and other rentals 21 19 19 Total lease expense $ 654 $ 602 $ 668 Revenue Lease income Cargo and other revenues (16) (14) (13) Net lease impact $ 638 $ 588 $ 655 Supplemental Cash Flow Information During the year ended December 31, 2021, the Company paid $359 million for capitalized operating leases. The Company also acquired $273 million of operating lease assets in exchange for assumption of the same total of operating lease liabilities, inclusive of lease extensions. Lease Term and Discount Rate As most leases do not provide an implicit interest rate, the Company generally utilizes the incremental borrowing rate (IBR) based on information available at the commencement date of the lease to determine the present value of lease payments. The weighted average IBR and weighted average remaining lease term (in years) for all asset classes were as follows at December 31, 2021. Weighted Average IBR Weighted Average Remaining Lease term Aircraft 3.9 % 7.2 CPA Aircraft 3.3 % 8.6 Airports and terminal facilities 4.1 % 8.6 Corporate real estate and other 4.1 % 29.6 Maturities of Lease Liabilities Future minimum lease payments under non-cancellable leases as of December 31, 2021 (in millions): Aircraft (a) CPA Aircraft Airport and Terminal Facilities Corporate Real Estate and Other 2022 $ 221 $ 84 $ 3 $ 11 2023 158 84 2 9 2024 101 84 2 7 2025 95 84 2 4 2026 89 84 2 4 Thereafter 311 291 8 75 Total Lease Payments $ 975 $ 711 $ 19 $ 110 Less: Imputed interest (127) (91) (3) (52) Total $ 848 $ 620 $ 16 $ 58 (a) - Future minimum lease payments for aircraft includes commitments for aircraft which have been removed from operating service as the Company remains obligated under existing terms. (b) - Future minimum lease payments in the table above are inclusive of incentive credits related to leased Boeing 737-9 aircraft. As a result, the operating lease liabilities presented on the consolidated balance sheet exceed total future payments. This difference will exist until all leased 737-9 aircraft are delivered. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2021 | |
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): 2021 2020 Excess of tax over book depreciation $ 1,145 $ 1,126 Intangibles - net 19 15 Operating lease assets 351 342 Other - net 76 106 Deferred tax liabilities 1,591 1,589 Mileage Plan (416) (385) Inventory obsolescence (17) (17) Employee benefits (127) (215) Net operating losses (25) (27) Operating lease liabilities (374) (381) Leasehold maintenance (40) (73) Other - net (34) (103) Deferred tax assets (1,033) (1,201) Valuation allowance 20 19 Net deferred tax liabilities $ 578 $ 407 At December 31, 2021, the Company has paid gross taxes of $52 million and expect to pay $21 million more for the tax year 2021. The Company is also awaiting payment of a $285 million federal tax refund receivable as a result of carrying back losses from the 2020 tax year and other various amendments of prior year tax returns. The Company also has gross state NOLs of approximately $413 million that expire beginning in 2023 and continuing through 2041. 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. During 2021, all remaining NOLs acquired through the acquisition of Virgin America were utilized to offset federal taxable income. 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 state NOL carryforward will not be realized and, therefore, has provided a valuation allowance of $20 million for that portion as of December 31, 2021. The Company has likewise concluded it is more likely than not that all of its federal and the remaining state deferred income tax assets will be realized and thus no additional valuation allowance has been recorded. The Company reassesses the need for a valuation allowance each reporting period. Components of Income Tax Expense (Benefit) The components of income tax expense (benefit) are as follows (in millions): 2021 2020 2019 Current income tax expense (benefit): Federal $ 40 $ (212) $ 26 State 16 (11) 13 Total current income tax expense (benefit) 56 (223) 39 Deferred income tax expense (benefit): Federal 80 (246) 175 State 15 (47) 33 Total deferred income tax expense (benefit) 95 (293) 208 Income tax expense (benefit) $ 151 $ (516) $ 247 Income Tax Rate Reconciliation Income tax expense (benefit) reconciles to the amount computed by applying the 2021 U.S. federal rate of 21% to income (loss) before income tax and for deferred taxes as follows (in millions): 2021 2020 2019 Income (loss) before income tax $ 629 $ (1,840) $ 1,016 Expected tax expense (benefit) 132 (386) 213 Nondeductible expenses 10 9 9 State income taxes 20 (62) 36 Tax law changes (14) (93) (9) Valuation allowance 1 18 — Other - net 2 (2) (2) Actual tax expense (benefit) $ 151 $ (516) $ 247 Effective tax rate 24.0 % 28.0 % 24.3 % The Company recorded a current tax benefit of $14 million in 2021 as a result of provisions outlined in the CARES Act. As a result of tax changes signed into law during 2017, with final regulations issued in 2019, the Company recorded a current tax benefit of $93 million in 2020. 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 2020 Alaska 2015 to 2020 California 2007 to 2020 Oregon 2003 to 2020 Certain tax years are open to the extent of net operating loss carryforwards. Changes in the liability for gross unrecognized tax benefits during 2021, 2020 and 2019 are as follows (in millions): 2021 2020 2019 Balance at January 1, $ 35 $ 40 $ 40 Additions related to prior years 3 1 — Releases related to prior years — (1) (1) Additions related to current year activity 3 — 2 Releases due to settlements — (4) — Releases due to lapse of statute of limitations — (1) (1) Balance at December 31, $ 41 $ 35 $ 40 As of December 31, 2021, the Company had $41 million of accrued tax contingencies, of which $34 million, if fully recognized, would increase the effective tax rate. As of December 31, 2021, 2020 and 2019, the Company has accrued interest and penalties, net of federal income tax benefit, of $8 million, $6 million, and $7 million. In 2021, the Company recognized an expense of $2 million, compared to a benefit of $1 million in 2020, and expense of $1 million in 2019, for interest and penalties, net of federal income tax benefit. At December 31, 2021, the Company has unrecognized tax benefits recorded as a liability. The Company increased its reserves for uncertain tax positions in 2021 by $6 million, primarily due to current year activity and amended returns. 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, 2021. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2021 | |
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 post-retirement 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. 2021 2020 Discount rates 2.82% to 2.90% 2.43% to 2.58% Rate of compensation increases 2.02% to 2.38% 2.02% to 2.43% Weighted average assumptions used to determine net periodic benefit cost: The rates below vary by plan and related work group. 2021 2020 2019 Discount rates 2.43% to 2.58% 3.33% to 3.47% 4.37% to 4.46% Expected return on plan assets 3.00% to 5.50% 3.25% to 5.50% 4.25% to 5.50% Rate of compensation increases 2.02% to 2.43% 2.11% to 5.44% 2.11% to 3.50% 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, 2021, 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 2021 2020 Target 2021 2020 Asset category: Domestic equity securities 2%-12% 7 % 7 % 32%-42% 38 % 44 % Non-U.S. equity securities —%-8% 3 % 3 % 11%-21% 16 % 18 % Fixed income securities 85%-95% 90 % 90 % 32%-52% 42 % 33 % Real estate —% — % — % —%-5% 4 % 5 % 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 maintain a fully-funded status. 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 expedient 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 assets by fund category (in millions): 2021 2020 Fair Value Hierarchy Fund type: U.S. equity market fund $ 885 $ 914 1 Non-U.S. equity fund 370 384 1 Credit bond index fund 1,342 1,088 1 Plan assets in common commingled trusts $ 2,597 $ 2,386 Real estate 92 96 (a) Cash equivalents 6 6 1 Total plan assets $ 2,695 $ 2,488 (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): 2021 2020 Projected benefit obligation (PBO) Beginning of year $ 2,934 $ 2,602 Service cost 56 52 Interest cost 56 75 Actuarial (gain)/loss (171) 339 Benefits paid (117) (134) End of year $ 2,758 $ 2,934 Plan assets at fair value Beginning of year $ 2,488 $ 2,239 Actual return on plan assets 224 383 Employer contributions 100 — Benefits paid (117) (134) End of year $ 2,695 $ 2,488 Unfunded status $ (63) $ (446) Percent funded 98 % 85 % The accumulated benefit obligation for the combined qualified defined-benefit pension plans was $2.7 billion and $2.8 billion at December 31, 2021 and 2020. During 2021 actuarial gains decreased the benefit obligation primarily due to the increase in discount rates. The amounts recognized in the consolidated balance sheets (in millions): 2021 2020 Accrued benefit liability-long term $ (155) $ (502) Plan assets-long term (within Other noncurrent assets) 92 51 Total liability recognized $ (63) $ (451) The amounts not yet reflected in net periodic benefit cost and included in AOCL (in millions): 2021 2020 Prior service credit $ (4) $ (5) Net loss 316 626 Amount recognized in AOCL (pretax) $ 312 $ 621 Defined benefit plans with projected benefit obligations and accumulated benefit obligations exceeding fair value of plan assets are as follows (in millions): 2021 2020 Projected benefit obligation $ 1,750 $ 2,207 Accumulated benefit obligation 1,685 2,057 Fair value of plan assets 1,595 1,710 Net pension expense for the qualified defined-benefit plans included the following components (in millions): 2021 2020 2019 Service cost $ 52 $ 46 $ 42 Interest cost 56 75 89 Restructuring charges (a) — 11 — Expected return on assets (122) (110) (95) Amortization of prior service credit (1) (1) (1) Recognized actuarial loss 37 35 37 Net pension expense $ 22 $ 56 $ 72 (a) In conjunction with the workforce reductions stemming from the COVID-19 pandemic, the Company recorded additional expense for employees accepting incentive leaves of absence. Such expense is included in Special items - restructuring charges on the consolidated statement of operations for the year-ended December 31, 2020. There are no current statutory funding requirements for the Company’s plans in 2022. 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 2022 $ 119 2023 128 2024 133 2025 149 2026 151 2027– 2031 830 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 $125 million and $138 million at December 31, 2021 and 2020. The net periodic benefit cost was not material in 2021 or 2020. 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 $125 million, $126 million and $132 million in 2021, 2020, and 2019. 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, 2021 and 2020. 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, 2021 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 $77 million and $61 million, which was recorded net of a prefunded trust account of $8 million and $7 million, and included in long-term other liabilities on the consolidated balance sheets as of December 31, 2021 and December 31, 2020. 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 and Leadership Development Committee of the Board of Directors. The aggregate expense under these plans in 2021, 2020 and 2019 was $151 million, $130 million and $163 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, cash flow metrics, safety, and sustainability. • The Operational Performance Rewards Program (OPR) entitles the majority of Alaska and Horizon employees to quarterly payouts of up to $450 per person if certain monthly operational and customer service objectives are met. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Future minimum payments for commitments as of December 31, 2021 (in millions): Aircraft Commitments (a) Capacity Purchase Agreements (b) 2022 $ 1,339 $ 173 2023 1,686 178 2024 389 183 2025 79 188 2026 13 189 Thereafter — 688 Total $ 3,506 $ 1,599 (a) Includes non-cancelable contractual commitments for aircraft and engines, aircraft maintenance and parts management. (b) Includes all non-aircraft lease costs associated with capacity purchase agreements. Aircraft Commitments Aircraft purchase commitments include non-cancelable contractual commitments for aircrafts and engines. As of December 31, 2021, Alaska had commitments to purchase 74 Boeing 737-9 aircraft with deliveries in 2022 through 2024. Horizon also has commitments to purchase seven E175 aircraft with deliveries in 2023 through 2025. Subsequent to December 31, 2021, Horizon added an additional five commitments with deliveries in 2022 and 2023. Alaska has options to purchase 52 737-9 aircraft and Horizon has options to purchase 15 E175 aircraft. 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. 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. Payments of such deposits follow contractual terms and timing, regardless of operating status of the respective aircraft. 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. Los Angeles International Airport (LAX) Construction In May 2019, we executed an amended lease agreement with Los Angeles World Airports, which includes an agreement to renovate and upgrade the fuel system, jet bridges and concourse facilities at Terminal 6 of LAX. Project terms and pre-construction readiness was approved and finalized in 2020. We expect construction will be completed by mid 2024. Under the terms of the agreement, we expect to have total reimbursable cash outlays for the project of approximately $230 million. To date, we have made total cash outlays of $71 million and have received reimbursement for $8.7 million of that total. 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 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 injunctive relief against Alaska Airlines. In February 2021, an appellate court reversed portions of the lower court decision and significantly reduced the judgment, again without awarding injunctive relief against Alaska. The determination of total judgment has not been completed as of the date of this filing. Based on the facts and circumstances available, the Company believes the range of potential loss to be between $0 and $22 million, and holds an accrual for $22 million in Other accrued liabilities on the consolidated balance sheets. The Company has asked the U.S. Supreme Court to review the case on the basis that the California laws on which the judgment is based are invalid as applied to airlines pursuant to the U.S. Constitution and provisions of federal law 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. If appeal efforts are unsuccessful, compliance with the California laws may have an adverse impact on the Company's operations and financial position, and collective bargaining agreements. The Company is involved in other litigation around the application of state and local employment laws, like many air carriers. Our defenses are similar to those identified above, including that the state and local laws are preempted by federal law and are unconstitutional because they impede interstate commerce. None of these additional disputes are material. |
SHAREHOLDER'S EQUITY
SHAREHOLDER'S EQUITY | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
SHAREHOLDER'S EQUITY | SHAREHOLDERS' EQUITY Dividends In March 2020, the Company suspended the payment of dividends indefinitely. The Company is barred by its CARES Act agreements from resuming any payment of dividends until October 1, 2022. Prior to the suspension, the Company paid dividends of $45 million and $173 million to shareholders of record during 2020 and 2019. Common Stock Repurchase In August 2015, the Board of Directors authorized a $1 billion share repurchase program. As of December 31, 2021, the Company has repurchased 7.6 million shares for $544 million under this program. In March 2020, the Company suspended the share repurchase program indefinitely. The Company is barred by its CARES Act agreements from resuming share repurchases until October 1, 2022. Prior to the suspension, the Company repurchased $31 million, or 538,078 shares, in 2020 and $75 million, or 1,192,820 shares, in 2019. At December 31, 2021, the Company held 9,349,944 shares in treasury. Management does not anticipate retiring common shares held in treasury for the foreseeable future. CARES Act Warrant Issuance As additional taxpayer protection required under the PSP programs, during 2021, the Company granted the Treasury a total of 539,508 warrants to purchase common stock. The warrants are non-voting, freely transferable, may be settled as net shares or in cash at the Company's option, and have a five-year term. In addition, in conjunction with the October 2020 draw on the CARES Act Loan, the Company granted the Treasury 427,080 warrants to purchase Alaska Air Group (ALK) common stock. The value of the warrants was estimated using the Black-Scholes option pricing model, and the relative fair value of the warrants of $6 million was recorded in stockholders' equity. Total warrants outstanding are as follows as of December 31, 2021: Number of shares of ALK common stock Strike Price PSP 1 928,127 31.61 CARES Act loan warrants 427,080 31.61 PSP 2 305,499 52.25 PSP 3 221,812 66.39 Outstanding December 31, 2021 1,882,518 Accumulated Other Comprehensive Loss (AOCL) Components of accumulated other comprehensive loss, net of tax (in millions): 2021 2020 Related to marketable securities $ (4) $ 23 Related to employee benefit plans (252) (498) Related to interest rate derivatives (6) (19) $ (262) $ (494) |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION PLANS | STOCK-BASED COMPENSATION PLANSThe 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 (ESPP). The table below summarizes the components of total stock-based compensation (in millions): 2021 2020 2019 Stock options $ 5 $ 4 $ 3 Stock awards 20 14 21 Deferred stock awards 1 1 1 Employee stock purchase plan 18 15 11 Stock-based compensation $ 44 $ 34 $ 36 Tax benefit related to stock-based compensation $ 11 $ 8 $ 9 Unrecognized stock-based compensation for non-vested options and awards and the weighted-average period the expense will be recognized (dollars in millions): Amount Weighted-Average Stock options $ 4 0.8 Stock awards 20 1.3 Unrecognized stock-based compensation $ 24 1.3 The Company is authorized to issue 20 million shares of common stock under these plans, of which 6,990,817 shares remain available for future grants of either options or stock awards as of December 31, 2021. 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: 2021 2020 2019 Expected volatility 43 % 34 % 30 % Expected term 6 years 6 years 6 years Risk-free interest rate 0.68 % 1.03 % 2.41 % Expected dividend yield — % 1.73 % 2.09 % Weighted-average grant date fair value per share $ 23.66 $ 14.11 $ 16.84 Estimated fair value of options granted (millions) $ 4 $ 6 $ 4 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, 2021: Shares Weighted- Weighted- Aggregate Intrinsic Outstanding, December 31, 2020 1,110,870 $ 60.54 6.8 $ 4 Granted 164,010 58.59 Exercised (87,778) 34.33 Canceled (6,860) 79.69 Forfeited or expired (1,015) 55.74 Outstanding, December 31, 2021 1,179,227 $ 62.11 6.7 $ 3 Exercisable, December 31, 2021 556,790 $ 65.51 5.4 $ 1 Vested or expected to vest, December 31, 2021 1,178,425 $ 62.11 6.7 $ 3 (in millions) 2021 2020 2019 Intrinsic value of option exercises $ 3 $ 2 $ 1 Fair value of options vested 4 3 3 Cash received from stock option exercises were not material for the year ended December 31, 2021. 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 vesting 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 Weighted-Average Grant Date Fair Value Weighted- Aggregate Non-vested, December 31, 2020 967,044 $ 51.85 1.7 $ 50 Granted 387,541 65.42 Vested (547,725) 55.77 Forfeited (260,380) 53.76 Non-vested, December 31, 2021 546,480 $ 52.81 1.3 $ 36 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 1,254,393, 1,524,194 and 784,786 shares in 2021, 2020 and 2019 under the ESPP. |
OPERATING SEGMENT INFORMATION
OPERATING SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2021 | |
Segment Reporting [Abstract] | |
Operating Segment Information | OPERATING SEGMENT INFORMATION Alaska Air Group has two operating airlines—Alaska and Horizon. Each is regulated by the U.S. Department of Transportation’s Federal Aviation Administration. Alaska has CPAs for regional capacity with Horizon and SkyWest, under which Alaska receives all passenger revenues. Under GAAP, 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, Costa Rica and Belize. • Regional - includes Horizon's and other third-party carriers’ scheduled air transportation for passengers across a shorter distance network within the U.S. and Canada under a CPA. 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 a 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, 2021 Mainline Regional Horizon Consolidating & Other (a) Air Group Adjusted (b) Special Items (c) Consolidated Operating Revenues Passenger revenues 4,411 1,088 — — 5,499 — 5,499 CPA revenues — — 406 (406) — — — Mileage Plan other revenue 402 59 — — 461 — 461 Cargo and other 212 — — 4 216 — 216 Total Operating Revenues 5,025 1,147 406 (402) 6,176 — 6,176 Operating Expenses Operating expenses, excluding fuel 4,101 1,096 373 (433) 5,137 (925) 4,212 Fuel expense 1,065 261 — — 1,326 (47) 1,279 Total Operating Expenses 5,166 1,357 373 (433) 6,463 (972) 5,491 Non-operating Income (Expense) (38) — (21) 3 (56) — (56) Income (Loss) Before Income Tax $ (179) $ (210) $ 12 $ 34 $ (343) $ 972 $ 629 Year Ended December 31, 2020 Mainline Regional Horizon Consolidating & Other (a) Air Group Adjusted (b) Special Items (c) Consolidated Operating Revenues Passenger revenues 2,350 669 — — 3,019 — 3,019 CPA revenues — — 386 (386) — — — Mileage Plan other revenue 309 65 — — 374 — 374 Cargo and other 170 — — 3 173 — 173 Total Operating Revenues 2,829 734 386 (383) 3,566 — 3,566 Operating Expenses Operating expenses, excluding fuel 3,630 993 323 (399) 4,547 71 4,618 Fuel expense 569 162 — — 731 (8) 723 Total Operating Expenses 4,199 1,155 323 (399) 5,278 63 5,341 Non-operating Income (Expense) (19) — (22) 2 (39) (26) (65) Income (Loss) Before Income Tax $ (1,389) $ (421) $ 41 $ 18 $ (1,751) $ (89) $ (1,840) Year Ended December 31, 2019 Mainline Regional Horizon Consolidating & Other (a) Air Group Adjusted (b) Special Items (c) Consolidated Operating Revenues Passenger revenues 6,750 1,345 — — 8,095 — 8,095 CPA revenues — — 450 (450) — — — Mileage Plan other revenue 419 46 — — 465 — 465 Cargo and other 212 3 1 5 221 — 221 Total Operating Revenues 7,381 1,394 451 (445) 8,781 — 8,781 Operating Expenses Operating expenses, excluding fuel 4,778 1,097 385 (464) 5,796 44 5,840 Fuel expense 1,589 295 — — 1,884 (6) 1,878 Total Operating Expenses 6,367 1,392 385 (464) 7,680 38 7,718 Non-operating Income (Expense) (21) — (28) 2 (47) — (47) Income (Loss) Before Income Tax $ 993 $ 2 $ 38 $ 21 $ 1,054 $ (38) $ 1,016 (a) Includes consolidating entries, Air Group parent company, McGee Air Services, and other immaterial business units. (b) 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. (c) Includes Payroll Support Program wage offsets, special items, and mark-to-market fuel-hedge accounting adjustments. 2021 2020 2019 Depreciation and amortization: Mainline $ 323 $ 346 $ 337 Horizon 71 74 86 Consolidated $ 394 $ 420 $ 423 Capital expenditures: Mainline $ 236 $ 210 $ 605 Horizon 56 12 91 Consolidated $ 292 $ 222 $ 696 Total assets at end of period: Mainline $ 19,258 $ 19,754 Horizon 1,212 1,170 Consolidating & Other (6,519) (6,878) Consolidated $ 13,951 $ 14,046 |
GENERAL AND SUMMARY OF SIGNIF_2
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
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 Alaska Air Group (Air Group, or the Company), and its primary subsidiaries, Alaska Airlines, Inc. (Alaska) and Horizon Air Industries, Inc. (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 (GAAP) 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 $7 million and $5 million at December 31, 2021 and 2020, 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, 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 are reflected in accumulated other comprehensive loss (AOCL). The Company evaluates the investment portfolio on a quarterly basis for expected credit losses. The Company uses a systematic methodology that groups assets by relevant market sector, and considers available quantitative and qualitative evidence in evaluating potential allowances for credit losses. 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 the result of an expected credit loss, an allowance is recorded to Other—net in the consolidated statements of operations. |
Inventory, Policy [Policy Text Block] | 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 $49 million and $46 million at December 31, 2021 and 2020. Removals from the reserve in 2021 were immaterial. Inventory and supplies — net also includes fuel inventory of $21 million and $15 million at December 31, 2021 and 2020. 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 and E175 aircraft 20 to 25 years 10% Bombardier Q400 aircraft 15 years 5% Buildings 25 to 40 years 10% Minor building and land improvements 10 years —% Capitalized leases and leasehold improvements Generally shorter of lease term or —% Computer hardware and software 3 to 10 years —% Other furniture and equipment 5 to 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. 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. Beginning in 2022, maintenance on owned E175 aircraft will also be covered under a power-by-the-hour agreement with a third party. For these agreements, 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 . For these purposes, the fair value is estimated using a combination of Level 2 inputs, including published market value estimates for the assets being assessed, and Level 3 inputs, including Company-specific and asset-specific indicators. Goodwill |
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 the fourth quarter, or more frequently if events or circumstances indicate than an impairment may exist. The assessment utilizes either a qualitative or quantitative approach. The qualitative approach considers factors such as Alaska Air Group market capitalization and other market trends, and unobservable inputs, including Company specific cash flow and performance information. If it is determined that it is more likely than not that the asset may be impaired, management utilizes a quantitative approach to assess the asset's fair value and the amount of impairment and a charge may be recorded. In 2021, the fair value of the Mainline reporting unit substantially exceeded its carrying value. |
Intangible Assets | Intangible Assets Intangible assets are comprised primarily of indefinite-lived airport slots and finite-lived customer relationships recorded in conjunction with the acquisition of Virgin America. Finite-lived intangibles were recorded at fair value upon acquisition and are amortized over their estimated useful lives. Indefinite-lived intangibles were recorded at fair value upon acquisition and are not amortized, but are tested at least annually for impairment using a similar methodology to goodwill, as described above. |
Aircraft Maintenance Deposits | Aircraft Maintenance DepositsCertain 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. The Company establishes accounting maintenance deposits as assets on the balance sheet using estimates of the anticipated timing and cost of the specific major maintenance events, such that the accounting deposits do not exceed the amount qualified for reimbursement. Aircraft maintenance deposits recorded on the consolidated balance sheets were $175 million and $242 million as of December 31, 2021 and December 31, 2020. |
Leased Aircraft Return Costs [Policy Text Block] | Leased Aircraft Return Costs Costs of returning leased aircraft are accrued when the costs are probable and reasonably estimable, usually beginning at least twelve months prior to the lease return, unless a determination is made that the leased asset is removed from operation. If the leased aircraft is removed from the operating fleet, the estimated cost of return is accrued at the time of removal. 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. |
Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block] | Advertising Expenses |
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, including property, plant and equipment, goodwill, intangible assets and certain other 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. The leveling of inputs for financial and non-financial instruments are disclosed in this note, and 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, 2021, 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. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation Accounting standards require companies to recognize expense over the service period based on the fair value of stock options and other equity-based compensation issued to employees estimated 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 2021 anti-dilutive stock options excluded from the calculation of EPS were not material. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Adopted Accounting Pronouncements In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848)," which provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting to ease the financial reporting burden related to the expected market transition from LIBOR to alternative reference rates. In January 2021, the FASB updated Topic 848, providing additional clarification and scope relating to transition to alternative reference rates. The guidance was effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2022. The Company is not expected to transition to alternative rates prior to fiscal year 2023. The Company does not expect adoption and transition to alternative reference rates will have a material impact on our consolidated financial statements. |
Receivable | Receivables—net Receivables primarily consist of amounts due from taxing authorities, credit card processors, and the Company's affinity card partner stemming from income tax returns, sales of tickets to customers and bank purchased miles. Given the nature of these receivables, reserves are immaterial to the overall balance. |
GENERAL AND SUMMARY OF SIGNIF_3
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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 and E175 aircraft 20 to 25 years 10% Bombardier Q400 aircraft 15 years 5% Buildings 25 to 40 years 10% Minor building and land improvements 10 years —% Capitalized leases and leasehold improvements Generally shorter of lease term or —% Computer hardware and software 3 to 10 years —% Other furniture and equipment 5 to 10 years —% |
COVID-19 PANDEMIC (Tables)
COVID-19 PANDEMIC (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Risks and Uncertainties [Abstract] | |
Schedule of Funds Received Under CARES Payroll Support Programs | Total funds contracted from the Treasury under the Payroll Support Programs are allocated as follows (in millions): Grants Loans Warrants Total Proceeds PSP 1 $ 757 $ 293 $ 9 $ 1,059 PSP 2 457 160 9 626 PSP 3 431 147 7 585 Total $ 1,645 $ 600 $ 25 $ 2,270 |
Restructuring and Related Costs | The table below presents a roll forward of the outstanding voluntary leave liability (in millions): Twelve Months Ended Total voluntary leave liability balance at January 1 $ 127 Cash payments (105) Charges and adjustments (10) Total voluntary leave liability balance at December 31 $ 12 |
REVENUE FROM CONTRACTS WITH C_2
REVENUE FROM CONTRACTS WITH CUSTOMERS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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, 2021 2020 2019 Passenger ticket revenue, including ticket breakage and net of taxes and fees $ 4,533 $ 2,428 $ 6,824 Passenger ancillary revenue 327 245 567 Mileage Plan passenger revenue 639 346 704 Total Passenger revenue $ 5,499 $ 3,019 $ 8,095 Mileage Plan revenue included in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2021 2020 2019 Passenger revenue $ 639 $ 346 $ 704 Mileage Plan other revenue 461 374 465 Total Mileage Plan revenue $ 1,100 $ 720 $ 1,169 Cargo and other revenue included in the consolidated statements of operations (in millions): Twelve Months Ended December 31, 2021 2020 2019 Cargo revenue $ 124 $ 112 $ 133 Other revenue 92 61 88 Total Cargo and other revenue $ 216 $ 173 $ 221 |
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, 2021 2020 Total Deferred Revenue balance at January 1 $ 2,277 $ 1,990 Travel miles and companion certificate redemption - Passenger revenue (639) (346) Miles redeemed on partner airlines - Other revenue (43) (23) Increase in liability for mileage credits issued 763 656 Total Deferred Revenue balance at December 31 $ 2,358 $ 2,277 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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): 2021 2020 Fuel hedge contracts (not designated as hedges) Prepaid expenses and other current assets $ 71 $ 11 Other assets 10 4 Interest rate swaps (designated as hedges) Other accrued liabilities (6) (10) Other liabilities (3) (15) Gains (losses) in accumulated other comprehensive loss (AOCL) 17 (21) |
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): 2021 2020 2019 Fuel hedge contracts (not designated as hedges) Gains (losses) recognized in Aircraft fuel $ 104 $ (10) $ (10) Interest rate swaps (designated as hedges) Losses recognized in Aircraft rent — (3) (3) Gains (losses) recognized in other comprehensive income (OCI) 17 (21) (13) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by Balance Sheet Grouping [Table Text Block] | Fair values of financial instruments on the consolidated balance sheet (in millions): December 31, 2021 December 31, 2020 Level 1 Level 2 Total Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 331 $ — $ 331 $ 407 $ — $ 407 Equity mutual funds 6 — 6 7 — 7 Foreign government bonds — 38 38 — 20 20 Asset-backed securities — 311 311 — 224 224 Mortgage-backed securities — 232 232 — 290 290 Corporate notes and bonds — 1,663 1,663 — 978 978 Municipal securities — 65 65 — 50 50 Total Marketable securities 337 2,309 2,646 414 1,562 1,976 Derivative instruments Fuel hedge contracts - call options — 81 81 — 15 15 Total Assets $ 337 $ 2,390 $ 2,727 $ 414 $ 1,577 $ 1,991 Liabilities Derivative instruments Interest rate swap agreements — (9) (9) — (25) (25) Total Liabilities $ — $ (9) $ (9) $ — $ (25) $ (25) Fixed-rate debt on the consolidated balance sheet and the estimated fair value of long-term fixed-rate debt (in millions): December 31, 2021 December 31, 2020 Total fixed rate debt $ 1,821 $ 1,662 Estimated fair value $ 1,919 $ 1,778 |
Schedule of Realized Gain (Loss) [Table Text Block] | Proceeds from sales of marketable securities were $3.6 billion, $2.3 billion and $1.7 billion in 2021, 2020, and 2019. |
Schedule of Debt Investment Maturities [Table Text Block] | Maturities for marketable securities (in millions): December 31, 2021 Cost Basis Fair Value Due in one year or less $ 1,064 $ 1,065 Due after one year through five years 1,537 1,532 Due after five years 44 42 Total $ 2,645 $ 2,639 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | Long-term debt obligations on the consolidated balance sheet (in millions): 2021 2020 Fixed-rate notes payable due through 2029 $ 163 $ 198 Fixed-rate PSP note payable due through 2031 600 290 Fixed-rate EETC payable due through 2025 & 2027 1,058 1,174 Variable-rate notes payable due through 2029 738 1,866 Less debt issuance costs and unamortized debt discount (20) (33) Total debt 2,539 3,495 Less current portion 366 1,138 Long-term debt, less current portion $ 2,173 $ 2,357 Weighted-average fixed-interest rate 3.7 % 4.3 % Weighted-average variable-interest rate 1.3 % 1.9 % |
Schedule of Maturities of Long-term Debt [Table Text Block] | ong-term debt principal payments for the next five years and thereafter are as follows (in millions): Total 2022 $ 371 2023 334 2024 240 2025 261 2026 176 Thereafter 1,177 Total principal payments $ 2,559 |
Leases, Codification Topic 842
Leases, Codification Topic 842 (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Leases [Abstract] | |
Schedule of Lease Assets | Operating lease assets balance by asset class was as follows (in millions): December 31, 2021 December 31, 2020 Aircraft $ 782 $ 750 CPA Aircraft 600 579 Airport and terminal facilities 16 16 Corporate real estate and other 55 55 Total Operating lease assets $ 1,453 $ 1,400 |
Lease, Cost | The impact of leases, including variable lease cost, was as follows (in millions): Classification 2021 2020 2019 Expense Aircraft Aircraft rent $ 174 $ 215 $ 246 CPA Aircraft Aircraft rent 80 80 79 Airport and terminal facilities Landing fees and other rentals 379 288 324 Corporate real estate and other Landing fees and other rentals 21 19 19 Total lease expense $ 654 $ 602 $ 668 Revenue Lease income Cargo and other revenues (16) (14) (13) Net lease impact $ 638 $ 588 $ 655 |
Lessee, Operating Lease, Liability, Maturity | Future minimum lease payments under non-cancellable leases as of December 31, 2021 (in millions): Aircraft (a) CPA Aircraft Airport and Terminal Facilities Corporate Real Estate and Other 2022 $ 221 $ 84 $ 3 $ 11 2023 158 84 2 9 2024 101 84 2 7 2025 95 84 2 4 2026 89 84 2 4 Thereafter 311 291 8 75 Total Lease Payments $ 975 $ 711 $ 19 $ 110 Less: Imputed interest (127) (91) (3) (52) Total $ 848 $ 620 $ 16 $ 58 |
Weighted Average Lease Assumptions | The weighted average IBR and weighted average remaining lease term (in years) for all asset classes were as follows at December 31, 2021. Weighted Average IBR Weighted Average Remaining Lease term Aircraft 3.9 % 7.2 CPA Aircraft 3.3 % 8.6 Airports and terminal facilities 4.1 % 8.6 Corporate real estate and other 4.1 % 29.6 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | Deferred tax (assets) and liabilities comprise the following (in millions): 2021 2020 Excess of tax over book depreciation $ 1,145 $ 1,126 Intangibles - net 19 15 Operating lease assets 351 342 Other - net 76 106 Deferred tax liabilities 1,591 1,589 Mileage Plan (416) (385) Inventory obsolescence (17) (17) Employee benefits (127) (215) Net operating losses (25) (27) Operating lease liabilities (374) (381) Leasehold maintenance (40) (73) Other - net (34) (103) Deferred tax assets (1,033) (1,201) Valuation allowance 20 19 Net deferred tax liabilities $ 578 $ 407 |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | The components of income tax expense (benefit) are as follows (in millions): 2021 2020 2019 Current income tax expense (benefit): Federal $ 40 $ (212) $ 26 State 16 (11) 13 Total current income tax expense (benefit) 56 (223) 39 Deferred income tax expense (benefit): Federal 80 (246) 175 State 15 (47) 33 Total deferred income tax expense (benefit) 95 (293) 208 Income tax expense (benefit) $ 151 $ (516) $ 247 |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | 2021 2020 2019 Income (loss) before income tax $ 629 $ (1,840) $ 1,016 Expected tax expense (benefit) 132 (386) 213 Nondeductible expenses 10 9 9 State income taxes 20 (62) 36 Tax law changes (14) (93) (9) Valuation allowance 1 18 — Other - net 2 (2) (2) Actual tax expense (benefit) $ 151 $ (516) $ 247 Effective tax rate 24.0 % 28.0 % 24.3 % |
Summary of Income Tax Contingencies [Table Text Block] | 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 2020 Alaska 2015 to 2020 California 2007 to 2020 Oregon 2003 to 2020 Certain tax years are open to the extent of net operating loss carryforwards. Changes in the liability for gross unrecognized tax benefits during 2021, 2020 and 2019 are as follows (in millions): 2021 2020 2019 Balance at January 1, $ 35 $ 40 $ 40 Additions related to prior years 3 1 — Releases related to prior years — (1) (1) Additions related to current year activity 3 — 2 Releases due to settlements — (4) — Releases due to lapse of statute of limitations — (1) (1) Balance at December 31, $ 41 $ 35 $ 40 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Defined Benefit Plan, Plan with Accumulated Benefit Obligation in Excess of Plan Assets | Defined benefit plans with projected benefit obligations and accumulated benefit obligations exceeding fair value of plan assets are as follows (in millions): 2021 2020 Projected benefit obligation $ 1,750 $ 2,207 Accumulated benefit obligation 1,685 2,057 Fair value of plan assets 1,595 1,710 |
Defined Benefit Plan, Plan with Projected Benefit Obligation in Excess of Plan Assets | |
Qualified Defined Benefit [Member] | |
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. 2021 2020 Discount rates 2.82% to 2.90% 2.43% to 2.58% Rate of compensation increases 2.02% to 2.38% 2.02% to 2.43% Weighted average assumptions used to determine net periodic benefit cost: The rates below vary by plan and related work group. 2021 2020 2019 Discount rates 2.43% to 2.58% 3.33% to 3.47% 4.37% to 4.46% Expected return on plan assets 3.00% to 5.50% 3.25% to 5.50% 4.25% to 5.50% Rate of compensation increases 2.02% to 2.43% 2.11% to 5.44% 2.11% to 3.50% |
Schedule of Allocation of Plan Assets [Table Text Block] | 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 2021 2020 Target 2021 2020 Asset category: Domestic equity securities 2%-12% 7 % 7 % 32%-42% 38 % 44 % Non-U.S. equity securities —%-8% 3 % 3 % 11%-21% 16 % 18 % Fixed income securities 85%-95% 90 % 90 % 32%-52% 42 % 33 % Real estate —% — % — % —%-5% 4 % 5 % 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 maintain a fully-funded status. Plan assets by fund category (in millions): 2021 2020 Fair Value Hierarchy Fund type: U.S. equity market fund $ 885 $ 914 1 Non-U.S. equity fund 370 384 1 Credit bond index fund 1,342 1,088 1 Plan assets in common commingled trusts $ 2,597 $ 2,386 Real estate 92 96 (a) Cash equivalents 6 6 1 Total plan assets $ 2,695 $ 2,488 |
Schedule of Net Funded Status [Table Text Block] | The following table sets forth the status of the qualified defined-benefit pension plans (in millions): 2021 2020 Projected benefit obligation (PBO) Beginning of year $ 2,934 $ 2,602 Service cost 56 52 Interest cost 56 75 Actuarial (gain)/loss (171) 339 Benefits paid (117) (134) End of year $ 2,758 $ 2,934 Plan assets at fair value Beginning of year $ 2,488 $ 2,239 Actual return on plan assets 224 383 Employer contributions 100 — Benefits paid (117) (134) End of year $ 2,695 $ 2,488 Unfunded status $ (63) $ (446) Percent funded 98 % 85 % |
Schedule of Amounts Recognized in Balance Sheet [Table Text Block] | The amounts recognized in the consolidated balance sheets (in millions): 2021 2020 Accrued benefit liability-long term $ (155) $ (502) Plan assets-long term (within Other noncurrent assets) 92 51 Total liability recognized $ (63) $ (451) The amounts not yet reflected in net periodic benefit cost and included in AOCL (in millions): 2021 2020 Prior service credit $ (4) $ (5) Net loss 316 626 Amount recognized in AOCL (pretax) $ 312 $ 621 |
Schedule of Net Benefit Costs [Table Text Block] | Net pension expense for the qualified defined-benefit plans included the following components (in millions): 2021 2020 2019 Service cost $ 52 $ 46 $ 42 Interest cost 56 75 89 Restructuring charges (a) — 11 — Expected return on assets (122) (110) (95) Amortization of prior service credit (1) (1) (1) Recognized actuarial loss 37 35 37 Net pension expense $ 22 $ 56 $ 72 (a) In conjunction with the workforce reductions stemming from the COVID-19 pandemic, the Company recorded additional expense for employees accepting incentive leaves of absence. Such expense is included in Special items - restructuring charges on the consolidated statement of operations for the year-ended December 31, 2020. |
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 2022 $ 119 2023 128 2024 133 2025 149 2026 151 2027– 2031 830 |
COMMITMENTS AND CONTINGENCIES C
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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, 2021 (in millions): Aircraft Commitments (a) Capacity Purchase Agreements (b) 2022 $ 1,339 $ 173 2023 1,686 178 2024 389 183 2025 79 188 2026 13 189 Thereafter — 688 Total $ 3,506 $ 1,599 |
SHAREHOLDER'S EQUITY (Tables)
SHAREHOLDER'S EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | Components of accumulated other comprehensive loss, net of tax (in millions): 2021 2020 Related to marketable securities $ (4) $ 23 Related to employee benefit plans (252) (498) Related to interest rate derivatives (6) (19) $ (262) $ (494) |
Schedule of Stockholders' Equity Note, Warrants or Rights | Total warrants outstanding are as follows as of December 31, 2021: Number of shares of ALK common stock Strike Price PSP 1 928,127 31.61 CARES Act loan warrants 427,080 31.61 PSP 2 305,499 52.25 PSP 3 221,812 66.39 Outstanding December 31, 2021 1,882,518 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Share-based Payment Arrangement [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): 2021 2020 2019 Stock options $ 5 $ 4 $ 3 Stock awards 20 14 21 Deferred stock awards 1 1 1 Employee stock purchase plan 18 15 11 Stock-based compensation $ 44 $ 34 $ 36 Tax benefit related to stock-based compensation $ 11 $ 8 $ 9 |
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 (dollars in millions): Amount Weighted-Average Stock options $ 4 0.8 Stock awards 20 1.3 Unrecognized stock-based compensation $ 24 1.3 |
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: 2021 2020 2019 Expected volatility 43 % 34 % 30 % Expected term 6 years 6 years 6 years Risk-free interest rate 0.68 % 1.03 % 2.41 % Expected dividend yield — % 1.73 % 2.09 % Weighted-average grant date fair value per share $ 23.66 $ 14.11 $ 16.84 Estimated fair value of options granted (millions) $ 4 $ 6 $ 4 |
Share-based Compensation, Stock Options, Activity [Table Text Block] | The tables below summarize stock option activity for the year ended December 31, 2021: Shares Weighted- Weighted- Aggregate Intrinsic Outstanding, December 31, 2020 1,110,870 $ 60.54 6.8 $ 4 Granted 164,010 58.59 Exercised (87,778) 34.33 Canceled (6,860) 79.69 Forfeited or expired (1,015) 55.74 Outstanding, December 31, 2021 1,179,227 $ 62.11 6.7 $ 3 Exercisable, December 31, 2021 556,790 $ 65.51 5.4 $ 1 Vested or expected to vest, December 31, 2021 1,178,425 $ 62.11 6.7 $ 3 (in millions) 2021 2020 2019 Intrinsic value of option exercises $ 3 $ 2 $ 1 Fair value of options vested 4 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 Weighted-Average Grant Date Fair Value Weighted- Aggregate Non-vested, December 31, 2020 967,044 $ 51.85 1.7 $ 50 Granted 387,541 65.42 Vested (547,725) 55.77 Forfeited (260,380) 53.76 Non-vested, December 31, 2021 546,480 $ 52.81 1.3 $ 36 |
OPERATING SEGMENT INFORMATION (
OPERATING SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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, 2021 Mainline Regional Horizon Consolidating & Other (a) Air Group Adjusted (b) Special Items (c) Consolidated Operating Revenues Passenger revenues 4,411 1,088 — — 5,499 — 5,499 CPA revenues — — 406 (406) — — — Mileage Plan other revenue 402 59 — — 461 — 461 Cargo and other 212 — — 4 216 — 216 Total Operating Revenues 5,025 1,147 406 (402) 6,176 — 6,176 Operating Expenses Operating expenses, excluding fuel 4,101 1,096 373 (433) 5,137 (925) 4,212 Fuel expense 1,065 261 — — 1,326 (47) 1,279 Total Operating Expenses 5,166 1,357 373 (433) 6,463 (972) 5,491 Non-operating Income (Expense) (38) — (21) 3 (56) — (56) Income (Loss) Before Income Tax $ (179) $ (210) $ 12 $ 34 $ (343) $ 972 $ 629 Year Ended December 31, 2020 Mainline Regional Horizon Consolidating & Other (a) Air Group Adjusted (b) Special Items (c) Consolidated Operating Revenues Passenger revenues 2,350 669 — — 3,019 — 3,019 CPA revenues — — 386 (386) — — — Mileage Plan other revenue 309 65 — — 374 — 374 Cargo and other 170 — — 3 173 — 173 Total Operating Revenues 2,829 734 386 (383) 3,566 — 3,566 Operating Expenses Operating expenses, excluding fuel 3,630 993 323 (399) 4,547 71 4,618 Fuel expense 569 162 — — 731 (8) 723 Total Operating Expenses 4,199 1,155 323 (399) 5,278 63 5,341 Non-operating Income (Expense) (19) — (22) 2 (39) (26) (65) Income (Loss) Before Income Tax $ (1,389) $ (421) $ 41 $ 18 $ (1,751) $ (89) $ (1,840) Year Ended December 31, 2019 Mainline Regional Horizon Consolidating & Other (a) Air Group Adjusted (b) Special Items (c) Consolidated Operating Revenues Passenger revenues 6,750 1,345 — — 8,095 — 8,095 CPA revenues — — 450 (450) — — — Mileage Plan other revenue 419 46 — — 465 — 465 Cargo and other 212 3 1 5 221 — 221 Total Operating Revenues 7,381 1,394 451 (445) 8,781 — 8,781 Operating Expenses Operating expenses, excluding fuel 4,778 1,097 385 (464) 5,796 44 5,840 Fuel expense 1,589 295 — — 1,884 (6) 1,878 Total Operating Expenses 6,367 1,392 385 (464) 7,680 38 7,718 Non-operating Income (Expense) (21) — (28) 2 (47) — (47) Income (Loss) Before Income Tax $ 993 $ 2 $ 38 $ 21 $ 1,054 $ (38) $ 1,016 (a) Includes consolidating entries, Air Group parent company, McGee Air Services, and other immaterial business units. (b) 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. (c) Includes Payroll Support Program wage offsets, special items, and mark-to-market fuel-hedge accounting adjustments. 2021 2020 2019 Depreciation and amortization: Mainline $ 323 $ 346 $ 337 Horizon 71 74 86 Consolidated $ 394 $ 420 $ 423 Capital expenditures: Mainline $ 236 $ 210 $ 605 Horizon 56 12 91 Consolidated $ 292 $ 222 $ 696 Total assets at end of period: Mainline $ 19,258 $ 19,754 Horizon 1,212 1,170 Consolidating & Other (6,519) (6,878) Consolidated $ 13,951 $ 14,046 |
GENERAL AND SUMMARY OF SIGNIF_4
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CASH AND CASH EQUIVALENTS (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Negative cash balance | $ 7 | $ 5 |
GENERAL AND SUMMARY OF SIGNIF_5
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - INVENTORIES AND SUPPLIES - NET (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Allowance for all non-surplus expendable inventories | $ 49 | $ 46 |
Fuel inventory | $ 21 | $ 15 |
GENERAL AND SUMMARY OF SIGNIF_6
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - PROPERTY, EQUIPMENT AND DEPRECIATION (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 10.00% |
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 | 40 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] | |
Property, Plant and Equipment [Line Items] | |
Property, Plant, and Equipment, Salvage Value, Percentage | 0.00% |
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 |
Q400 | Aircraft [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 15 years |
Property, Plant, and Equipment, Salvage Value, Percentage | 5.00% |
GENERAL AND SUMMARY OF SIGNIF_7
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - ADVERTISING EXPENSES (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | |||
Advertising Expense | $ 63 | $ 41 | $ 72 |
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, 2021 | |
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 - MAINTENANCE DEPOSITS (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Aircraft Maintenance Deposits | $ 175 | $ 242 |
Lease Return Provision, Current | (53) | 54 |
Lease Return Provision, Non-Current | $ (114) | $ 246 |
GENERAL AND SUMMARY OF SIGNI_10
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - LEASE RETURN PROVISION (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||
Lease Return Provision, Current | $ (53) | $ 54 |
Lease Return Provision, Non-Current | $ (114) | $ 246 |
COVID-19 PANDEMIC (Details)
COVID-19 PANDEMIC (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Impaired Long-Lived Assets Held and Used [Line Items] | |
Asset Impairment Charges | $ 363 |
COVID-19 PANDEMIC NARRATIVE (De
COVID-19 PANDEMIC NARRATIVE (Details) $ in Millions | 12 Months Ended | 21 Months Ended | ||
Dec. 31, 2021USD ($)aircraftshares | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2021USD ($)aircraftshares | |
Concentration Risk [Line Items] | ||||
Asset Impairment Charges | $ 363 | |||
Leased Aircraft Return Costs | $ 209 | |||
Restructuring Charges | (10) | 220 | $ 0 | |
Special Items - Impairment charges and other | (1) | 627 | $ 0 | |
Line of credit facility, borrowing capacity | 486 | $ 486 | ||
CARES Act Payroll Tax Relief | $ 21 | 29 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares | 539,508 | 539,508 | ||
PSP Installments Received | $ 1,100 | $ 1,100 | ||
Adjustments to Additional Paid in Capital, Warrant Issued | 16 | |||
Restructuring and Related Cost, Expected Cost Remaining | 12 | 127 | 12 | |
Payments for Restructuring | (105) | |||
Proceeds From Payroll Support Program Grant | 892 | 753 | 1,645 | |
Other Asset Impairment Charges | 30 | |||
Total Expected Relief from PSP of CARES Act | 2,270 | |||
CARES Act PSP Warrants Issued Value | 25 | |||
Total Unsecured Term Loan through PSP of CARES Act | 600 | |||
Proceeds From Payroll Support Program Grant | $ 892 | 753 | 1,645 | |
Total Unsecured Term Loan through PSP of CARES Act | 600 | |||
CARES Act PSP Warrants Issued Value | 25 | |||
Total Expected Relief from PSP of CARES Act | 2,270 | |||
CARES PSP1 | ||||
Concentration Risk [Line Items] | ||||
Proceeds From Payroll Support Program Grant | 757 | |||
Total Expected Relief from PSP of CARES Act | 1,059 | |||
CARES Act PSP Warrants Issued Value | 9 | |||
Total Unsecured Term Loan through PSP of CARES Act | 293 | |||
Proceeds From Payroll Support Program Grant | 757 | |||
Total Unsecured Term Loan through PSP of CARES Act | 293 | |||
CARES Act PSP Warrants Issued Value | 9 | |||
Total Expected Relief from PSP of CARES Act | 1,059 | |||
CARES PSP2 | ||||
Concentration Risk [Line Items] | ||||
Proceeds From Payroll Support Program Grant | 457 | |||
Total Expected Relief from PSP of CARES Act | 626 | |||
CARES Act PSP Warrants Issued Value | 9 | |||
Total Unsecured Term Loan through PSP of CARES Act | 160 | |||
Proceeds From Payroll Support Program Grant | 457 | |||
Total Unsecured Term Loan through PSP of CARES Act | 160 | |||
CARES Act PSP Warrants Issued Value | 9 | |||
Total Expected Relief from PSP of CARES Act | 626 | |||
CARES PSP3 | ||||
Concentration Risk [Line Items] | ||||
Proceeds From Payroll Support Program Grant | 431 | |||
Total Expected Relief from PSP of CARES Act | 585 | |||
CARES Act PSP Warrants Issued Value | 7 | |||
Total Unsecured Term Loan through PSP of CARES Act | 147 | |||
Proceeds From Payroll Support Program Grant | 431 | |||
Total Unsecured Term Loan through PSP of CARES Act | 147 | |||
CARES Act PSP Warrants Issued Value | 7 | |||
Total Expected Relief from PSP of CARES Act | $ 585 | |||
Airbus | ||||
Concentration Risk [Line Items] | ||||
Aircraft Permanently Parked | aircraft | 40 | 40 | ||
US Treasury CARES Act Loan | ||||
Concentration Risk [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 1,900 | $ 1,900 | ||
Proceeds from Lines of Credit | $ 135 | |||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 6 |
REVENUE FROM CONTRACTS WITH C_3
REVENUE FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cargo and Other Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 216 | $ 173 | $ 221 |
Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 5,499 | 3,019 | 8,095 |
Passenger [Member] | Cargo and Other Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 124 | 112 | 133 |
Passenger Tickets [Member] | Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 4,533 | 2,428 | 6,824 |
Passenger Ancillary Services [Member] | Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 327 | 245 | 567 |
Mileage Plan Services [Member] | Passenger Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 639 | 346 | 704 |
Mileage Plan Services, Other [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | 461 | 374 | 465 |
Other Services [Member] | Cargo and Other Revenue [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 92 | $ 61 | $ 88 |
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, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Contract with Customer, Liability | $ 2,358 | $ 2,277 | $ 1,990 |
Contract with Customer, Liability, Increase From Issuance of Credits | 763 | 656 | |
Mileage Plan Services, Other [Member] | |||
Contract with Customer, Liability, Revenue Recognized | (43) | (23) | |
Passenger Services [Member] | |||
Contract with Customer, Liability, Revenue Recognized | $ (639) | $ (346) |
REVENUE FROM CONTRACTS WITH C_5
REVENUE FROM CONTRACTS WITH CUSTOMERS Narrative (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)aircraft | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Deferred Revenue Arrangement [Line Items] | |||
Percent of Mileage Breakage | 17.40% | 17.40% | |
Contract cost recognized | $ 90 | $ 43 | $ 208 |
Receivable | $ 546 | 480 | |
Number of Partner AIrlines | aircraft | 23 | ||
Credit Card Receivables | $ 167 | 83 | |
Prepaid Expenses and Other Current Assets [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Capitalized Contract Cost, Net | 37 | 24 | |
Passenger Revenue [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Contract with Customer, Liability, Revenue Recognized | 703 | 502 | |
Mileage Plan Revenue [Member] | |||
Deferred Revenue Arrangement [Line Items] | |||
Receivable | $ 62 | $ 48 |
DERIVATIVE INSTRUMENTS - BALANC
DERIVATIVE INSTRUMENTS - BALANCE SHEET CLASSIFICATION (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Derivatives, Fair Value [Line Items] | ||
Accumulated other comprehensive loss | $ (262) | $ (494) |
Fuel hedge contracts [Member] | Derivative Instruments Not Designated as Hedges [Member] | Fuel Hedge Contracts, Current [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Current | 71 | 11 |
Fuel hedge contracts [Member] | Derivative Instruments Not Designated as Hedges [Member] | Fuel Hedge Contracts, Noncurrent [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Noncurrent | 10 | 4 |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Other Accrued Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities, Current | (6) | (10) |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Other Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities, Noncurrent | (3) | (15) |
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 | $ 17 | $ (21) |
DERIVATIVE INSTRUMENTS - INCOME
DERIVATIVE INSTRUMENTS - INCOME STATEMENT (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Unrealized holding gains (losses) arising during the period | $ 17 | $ (21) | $ (13) |
Gains (losses) recognized in interest income [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Loss expected to be reclassified | 6 | ||
Interest rate swaps agreements [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Losses recognized in income | 10 | ||
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 | 104 | (10) | (10) |
Cash Flow Hedging [Member] | Derivative Instruments Designated as Hedges [Member] | Interest rate swaps agreements [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Unrealized holding gains (losses) arising during the period | 17 | (21) | (13) |
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 | $ 0 | $ (3) | $ (3) |
DERIVATIVE INSTRUMENTS - FAIR V
DERIVATIVE INSTRUMENTS - FAIR VALUE OF HEDGE POSITIONS (Details) gallons in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)gallons | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Payments for (Proceeds from) Hedge, Investing Activities | $ (38) | $ 14 | $ 19 |
Interest Income [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Price Risk Cash Flow Hedge Unrealized Gain (Loss) to be Reclassified During Next 12 Months | $ (6) | ||
Fuel hedge contracts [Member] | Derivative Instruments Not Designated as Hedges [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative, Nonmonetary Notional Amount | gallons | 425 | ||
Interest rate swaps agreements [Member] | Secured Debt [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative, Notional Amount | $ 469 |
FAIR VALUE MEASUREMENTS - FAIR
FAIR VALUE MEASUREMENTS - FAIR VALUE OF ASSETS AND LIABILITIES (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | $ 2,600 | |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 2,646 | $ 1,976 |
Derivative instruments, assets | 2,727 | 1,991 |
Derivative instruments, liabilities | (9) | (25) |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 337 | 414 |
Derivative instruments, assets | 337 | 414 |
Derivative instruments, liabilities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 2,309 | 1,562 |
Derivative instruments, assets | 2,390 | 1,577 |
Derivative instruments, liabilities | (9) | (25) |
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 | 81 | 15 |
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 | 81 | 15 |
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, liabilities | (9) | (25) |
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, 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, liabilities | (9) | (25) |
Fair Value, Measurements, Recurring [Member] | US Treasury and Government [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 331 | 407 |
Fair Value, Measurements, Recurring [Member] | US Treasury and Government [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 331 | 407 |
Fair Value, Measurements, Recurring [Member] | US Treasury and Government [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Debt Security, Government, Non-US [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 38 | 20 |
Fair Value, Measurements, Recurring [Member] | Debt Security, Government, Non-US [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Debt Security, Government, Non-US [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 38 | 20 |
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities, Securitized Loans and Receivables [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 311 | 224 |
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities, Securitized Loans and Receivables [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Asset-backed Securities, Securitized Loans and Receivables [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 311 | 224 |
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Backed Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 232 | 290 |
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Backed Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Backed Securities [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 232 | 290 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 1,663 | 978 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | Corporate Debt Securities [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 1,663 | 978 |
Fair Value, Measurements, Recurring [Member] | US States and Political Subdivisions Debt Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 65 | 50 |
Fair Value, Measurements, Recurring [Member] | US States and Political Subdivisions Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 0 | 0 |
Fair Value, Measurements, Recurring [Member] | US States and Political Subdivisions Debt Securities [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 65 | 50 |
Fair Value, Measurements, Recurring [Member] | Equity funds [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 6 | 7 |
Fair Value, Measurements, Recurring [Member] | Equity funds [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | 6 | 7 |
Fair Value, Measurements, Recurring [Member] | Equity funds [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Marketable securities | $ 0 | $ 0 |
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, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Securities, Available-for-sale [Line Items] | |||
Sales and maturities of marketable securities | $ 3,595 | $ 2,318 | $ 1,674 |
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, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash, Cash Equivalents, and Short-term Investments [Abstract] | |||
Sales and maturities of marketable securities | $ 3,595 | $ 2,318 | $ 1,674 |
Debt Securities, Available-for-sale, Fair Value, Fiscal Year Maturity [Abstract] | |||
Due in one year or less | 1,065 | ||
Due after one year through five years | 1,532 | ||
Due after five years through 10 years | 42 | ||
Debt Securities, Available-for-sale, Total | 2,639 | ||
Debt Securities, Available-for-sale, Amortized Cost, Fiscal Year Maturity [Abstract] | |||
Due in one year or less | 1,064 | ||
Due after one year through five years | 1,537 | ||
Due after five years through 10 years | 44 | ||
Marketable securities | 2,645 | ||
Debt Securities, Available-for-sale, Maturity, without Single Maturity Date, Amortized Cost | $ 6 |
FAIR VALUE MEASUREMENTS - LONG-
FAIR VALUE MEASUREMENTS - LONG-TERM DEBT (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term Debt, Fair Value | $ 763 | |
Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | 1,821 | $ 1,662 |
Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | $ 1,919 | $ 1,778 |
LONG-TERM DEBT - SCHEDULE OF LO
LONG-TERM DEBT - SCHEDULE OF LONG-TERM DEBT (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | |||
Long-term Debt | $ 2,539 | $ 3,495 | |
Less debt issuance costs and unamortized debt discount | (20) | (33) | |
Less current portion | 366 | 1,138 | |
Long-term debt, net of current portion | $ 2,173 | $ 2,357 | |
Weighted-average fixed-interest rate | 3.70% | 4.30% | |
Weighted-average variable-interest rate | 1.30% | 1.90% | |
Proceeds from issuance of long-term debt, net of issuance costs | $ 363 | $ 2,564 | $ 450 |
Long-term debt payments | 1,334 | 565 | $ 1,058 |
Repayments of debt | 923 | ||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
2022 | 371 | ||
2023 | 334 | ||
2024 | 240 | ||
2025 | 261 | ||
2026 | 176 | ||
Thereafter | 1,177 | ||
Long-term Debt | 2,559 | ||
Unsecured Term Loan through PSP of CARES Act | 600 | 290 | |
Adjustments to Additional Paid in Capital, Warrant Issued | $ 16 | ||
Long-term Debt, Weighted Average Interest Rate, at Point in Time | 3.30% | ||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 16 | ||
Fixed-rate notes payable due through 2029 | |||
Debt Instrument [Line Items] | |||
Long-term Debt | 163 | 198 | |
Variable-rate notes payable due through 2029 | |||
Debt Instrument [Line Items] | |||
Long-term Debt | 1,866 | ||
Variable Rate Notes Payable due through 2029 | |||
Debt Instrument [Line Items] | |||
Long-term Debt | 738 | ||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
Proceeds from Issuance of Long-term Debt | 54 | ||
Proceeds from Issuance of Long-term Debt | 54 | ||
July 2020 EETC | |||
Debt Instrument [Line Items] | |||
Long-term Debt | 1,058 | 1,174 | |
US Treasury CARES Act Loan | |||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
Adjustments to Additional Paid in Capital, Warrant Issued | 6 | ||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 6 | ||
CARES Act PSP Term Loan | |||
Long-term Debt, Fiscal Year Maturity [Abstract] | |||
Proceeds from Issuance of Long-term Debt | 311 | ||
Proceeds from Issuance of Long-term Debt | $ 311 |
LONG-TERM DEBT LONG-TERM DEBT -
LONG-TERM DEBT LONG-TERM DEBT - SECURED DEBT (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | |||
Debt instrument, increase (decrease) | $ (956) | ||
Long-term Debt | 2,539 | $ 3,495 | |
Long-term debt payments | 1,334 | 565 | $ 1,058 |
Repayments of debt | 923 | ||
Proceeds from Issuance of Debt | $ 363 | $ 2,564 | $ 450 |
LONG-TERM DEBT - LINE OF CREDIT
LONG-TERM DEBT - LINE OF CREDIT (Details) | 12 Months Ended | |||
Dec. 31, 2021USD ($)credit_facility | Sep. 30, 2021USD ($) | Jun. 30, 2021USD ($) | Sep. 01, 2020USD ($) | |
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 486,000,000 | |||
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 | $ 86,000,000 | |||
Credit Facility 2 [Member] | Secured by other [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 150,000,000 | |||
Credit Facility 3 [Member] | Secured by aircraft [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | $ 250,000,000 | |||
US Treasury CARES Act Loan | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit facility, borrowing capacity | 1,900,000,000 | |||
Proceeds from Lines of Credit | $ 135,000,000 |
LEASES - NARRATIVE (Details)
LEASES - NARRATIVE (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)aircraft | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Lessee, Lease, Description [Line Items] | |||
Sublease Income | $ 16 | $ 14 | $ 13 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 273 | ||
Operating Lease, Payments | 359 | ||
Lessor, Operating Lease, Lease Not yet Commenced, Assumption and Judgment, Value of Underlying Asset, Amount | $ 730 | ||
Property Subject to Operating Lease [Member] | Airbus | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 61 | ||
Property Subject to Operating Lease [Member] | Q400 | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 7 | ||
Property Subject to Operating Lease [Member] | E175 [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 32 | ||
Property Subject to Operating Lease [Member] | B737 | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 10 | ||
Property Subject to Operating Lease [Member] | B737 MAX [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 5 | ||
Airport Facilities [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Variable Lease, Cost | $ 377 | 286 | 322 |
Aircraft Leases [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Variable Lease, Cost | $ 5 | 1 | 4 |
Aircraft Leases [Member] | Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Lessee, Operating Lease, Term of Contract | 12 years | ||
Corporate real estate [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Variable Lease, Cost | $ 17 | $ 12 | $ 10 |
LEASES - Schedule of Leased Ass
LEASES - Schedule of Leased Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Right-of-Use Asset | $ 1,453 | $ 1,400 | |
Operating Lease, Expense | 654 | 602 | $ 668 |
Sublease Income | (16) | (14) | (13) |
Lease, Cost | 638 | 588 | 655 |
Aircraft Leases [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Right-of-Use Asset | 782 | 750 | |
Operating Lease, Cost | 174 | 215 | 246 |
CPA Aircraft [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Right-of-Use Asset | 600 | 579 | |
Operating Lease, Cost | 80 | 80 | 79 |
Airport Facilities [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Right-of-Use Asset | 16 | 16 | |
Operating Lease, Cost | 379 | 288 | 324 |
Corporate real estate [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Right-of-Use Asset | 55 | 55 | |
Operating Lease, Cost | $ 21 | $ 19 | $ 19 |
LEASES - Lease Cost (Details)
LEASES - Lease Cost (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Expense | $ 654 | $ 602 | $ 668 |
Sublease Income | 16 | 14 | 13 |
Lease, Cost | 638 | 588 | 655 |
Aircraft Leases [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Cost | $ 174 | 215 | 246 |
Operating Lease, Weighted Average Discount Rate, Percent | 3.90% | ||
Operating Lease, Weighted Average Remaining Lease Term | 7 years 2 months 12 days | ||
CPA Aircraft [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Cost | $ 80 | 80 | 79 |
Operating Lease, Weighted Average Discount Rate, Percent | 3.30% | ||
Operating Lease, Weighted Average Remaining Lease Term | 8 years 7 months 6 days | ||
Airport Facilities [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Cost | $ 379 | 288 | 324 |
Operating Lease, Weighted Average Discount Rate, Percent | 4.10% | ||
Operating Lease, Weighted Average Remaining Lease Term | 8 years 7 months 6 days | ||
Corporate real estate [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease, Cost | $ 21 | $ 19 | $ 19 |
Operating Lease, Weighted Average Discount Rate, Percent | 4.10% | ||
Operating Lease, Weighted Average Remaining Lease Term | 29 years 7 months 6 days |
LEASES - Maturity of Lease Liab
LEASES - Maturity of Lease Liabilities (Details) $ in Millions | Dec. 31, 2021USD ($) |
Aircraft Leases [Member] | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating Lease, Liability, Payments, Due Next Twelve Months | $ 221 |
Lessee, Operating Lease, Liability, Payments, Due Year Two | 158 |
Lessee, Operating Lease, Liability, Payments, Due Year Three | 101 |
Lessee, Operating Lease, Liability, Payments, Due Year Four | 95 |
Lessee, Operating Lease, Liability, Payments, Due Year Five | 89 |
Lessee, Operating Lease, Liability, Payments, Due after Year Five | 311 |
Lessee, Operating Lease, Liability, Payments, Due | 975 |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 127 |
Operating Lease, Liability | 848 |
CPA Aircraft [Member] | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating Lease, Liability, Payments, Due Next Twelve Months | 84 |
Lessee, Operating Lease, Liability, Payments, Due Year Two | 84 |
Lessee, Operating Lease, Liability, Payments, Due Year Three | 84 |
Lessee, Operating Lease, Liability, Payments, Due Year Four | 84 |
Lessee, Operating Lease, Liability, Payments, Due Year Five | 84 |
Lessee, Operating Lease, Liability, Payments, Due after Year Five | 291 |
Lessee, Operating Lease, Liability, Payments, Due | 711 |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 91 |
Operating Lease, Liability | 620 |
Airport Facilities [Member] | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating Lease, Liability, Payments, Due Next Twelve Months | 3 |
Lessee, Operating Lease, Liability, Payments, Due Year Two | 2 |
Lessee, Operating Lease, Liability, Payments, Due Year Three | 2 |
Lessee, Operating Lease, Liability, Payments, Due Year Four | 2 |
Lessee, Operating Lease, Liability, Payments, Due Year Five | 2 |
Lessee, Operating Lease, Liability, Payments, Due after Year Five | 8 |
Lessee, Operating Lease, Liability, Payments, Due | 19 |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 3 |
Operating Lease, Liability | 16 |
Corporate real estate [Member] | |
Lessee, Lease, Description [Line Items] | |
Lessee, Operating Lease, Liability, Payments, Due Next Twelve Months | 11 |
Lessee, Operating Lease, Liability, Payments, Due Year Two | 9 |
Lessee, Operating Lease, Liability, Payments, Due Year Three | 7 |
Lessee, Operating Lease, Liability, Payments, Due Year Four | 4 |
Lessee, Operating Lease, Liability, Payments, Due Year Five | 4 |
Lessee, Operating Lease, Liability, Payments, Due after Year Five | 75 |
Lessee, Operating Lease, Liability, Payments, Due | 110 |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 52 |
Operating Lease, Liability | $ 58 |
INCOME TAXES - DEFERRED TAX ASS
INCOME TAXES - DEFERRED TAX ASSETS AND LIABILITIES (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Income Tax Disclosure [Abstract] | ||
Excess of tax over book depreciation | $ 1,145 | $ 1,126 |
Deferred Tax Liabilities, Intangible Assets | 19 | 15 |
Deferred Tax Liabilities, Other | 76 | 106 |
Gross deferred tax liabilities | 1,591 | 1,589 |
Mileage Plan | (416) | (385) |
Inventory obsolescence | (17) | (17) |
Employee benefits | (127) | (215) |
Net operating losses | (25) | (27) |
Other - net | (34) | (103) |
Deferred tax assets | (1,033) | (1,201) |
Valuation allowance | 20 | 19 |
Net deferred tax liabilities | 578 | 407 |
Operating Loss Carryforwards [Line Items] | ||
Deferred Tax Liabilities, Other Finite-Lived Assets | 351 | 342 |
Deferred Tax Assets - Leasing Arrangement | 374 | 381 |
Deferred Tax Assets, Leasehold Maintenance | (40) | $ (73) |
Federal [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Income Taxes Receivable | 285 | |
State [Member] | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss | $ 413 |
INCOME TAXES - COMPONENTS OF TA
INCOME TAXES - COMPONENTS OF TAX EXPENSE (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current tax expense (benefit): | |||
Federal | $ 40 | $ (212) | $ 26 |
State | 16 | (11) | 13 |
Total current | 56 | (223) | 39 |
Deferred tax expense: | |||
Federal | 80 | (246) | 175 |
State | 15 | (47) | 33 |
Total deferred | 95 | (293) | 208 |
Income tax (benefit) expense | $ 151 | $ (516) | $ 247 |
INCOME TAXES - EFFECTIVE INCOME
INCOME TAXES - EFFECTIVE INCOME TAX RECONCILIATION (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Business Acquisition [Line Items] | |||
U.S. federal tax rate | 21.00% | 35.00% | 35.00% |
Income before income tax | $ 629 | $ (1,840) | $ 1,016 |
Expected tax expense | 132 | (386) | 213 |
Nondeductible expenses | 10 | 9 | 9 |
State income taxes | 20 | (62) | 36 |
Valuation allowance | 1 | 18 | 0 |
Tax law changes | (14) | (93) | (9) |
Other—net | 2 | (2) | (2) |
Income tax (benefit) expense | $ 151 | $ (516) | $ 247 |
Effective tax rate | 24.00% | 28.00% | 24.30% |
INCOME TAXES INCOME TAXES - UNC
INCOME TAXES INCOME TAXES - UNCERTAIN TAX POSITIONS (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Contingency [Line Items] | ||||
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | $ 34 | |||
Income Tax Examination, Penalties and Interest Accrued | 8 | $ 6 | $ 7 | |
Income Tax Examination, Penalties and Interest Expense | 2 | (1) | $ 1 | |
Unrecognized Tax Benefits, Period Increase (Decrease) | 6 | |||
Unrecognized Tax Benefits, Decrease Resulting from Settlements with Taxing Authorities | 0 | 4 | 0 | |
Beginning balance | 35 | 40 | 40 | |
Additions related to prior years | 3 | 1 | 0 | |
Releases related to prior years | 0 | (1) | (1) | |
Additions related to current year activity | 3 | 0 | 2 | |
Releases due to settlements | 0 | (4) | 0 | |
Releases due to lapse of statute of limitations | 0 | (1) | (1) | |
Ending balance | $ 41 | $ 35 | $ 40 |
INCOME TAXES INCOME TAXES NARRA
INCOME TAXES INCOME TAXES NARRATIVE (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |||
Tax law changes | $ (14) | $ (93) | $ (9) |
Income Taxes Paid | 52 | ||
Taxes Payable | $ 21 |
INCOME TAXES NEW ACCOUNTING STA
INCOME TAXES NEW ACCOUNTING STANDARDS (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Other Special Items [Line Items] | ||
Deferred Tax Liabilities, Other | $ 76 | $ 106 |
Valuation allowance | $ 20 | $ 19 |
EMPLOYEE BENEFIT PLANS EMPLOYEE
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS - ADDITIONAL INFORMATION (Details) | 12 Months Ended |
Dec. 31, 2021plan | |
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, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Minimum [Member] | |||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Benefit obligations, Weighted-average discount rate | 2.82% | 2.43% | |
Benefit obligations, Rate of compensation increase | 2.02% | 2.02% | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Net period benefit costs, Weighted-average discount rate | 2.43% | 3.33% | 4.37% |
Net period benefit costs, Weighted-average expected return on assets | 3.00% | 3.25% | 4.25% |
Net period benefit costs, Rate of compensation increase | 2.02% | 2.11% | 2.11% |
Maximum [Member] | |||
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract] | |||
Benefit obligations, Weighted-average discount rate | 2.90% | 2.58% | |
Benefit obligations, Rate of compensation increase | 2.38% | 2.43% | |
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract] | |||
Net period benefit costs, Weighted-average discount rate | 2.58% | 3.47% | 4.46% |
Net period benefit costs, Weighted-average expected return on assets | 5.50% | 5.50% | 5.50% |
Net period benefit costs, Rate of compensation increase | 2.43% | 5.44% | 3.50% |
EMPLOYEE BENEFIT PLANS - PLAN A
EMPLOYEE BENEFIT PLANS - PLAN ASSETS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Qualified Defined Benefit [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 2,695 | $ 2,488 | $ 2,239 |
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 | $ 2,597 | $ 2,386 | |
Qualified Defined Benefit [Member] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 42.00% | 33.00% | |
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 | $ 1,342 | $ 1,088 | |
Qualified Defined Benefit [Member] | Real Estate [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 4.00% | 5.00% | |
Qualified Defined Benefit [Member] | Real Estate [Member] | Level 3 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 92 | $ 96 | |
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 | $ 6 | $ 6 | |
Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 38.00% | 44.00% | |
Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, US | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 885 | $ 914 | |
Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, Non-US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 16.00% | 18.00% | |
Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, Non-US | Fair Value, Inputs, Level 1 [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Amount | $ 370 | $ 384 | |
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] | Fixed Income Securities [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 90.00% | 90.00% | |
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] | Defined Benefit Plan, Equity Securities, US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 7.00% | 7.00% | |
Qualified Defined Benefit Plan - Salaried [Member] | Defined Benefit Plan, Equity Securities, Non-US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset allocations | 3.00% | 3.00% | |
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 | 32 | ||
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 | — | ||
Minimum [Member] | Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 32 | ||
Minimum [Member] | Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, Non-US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 11 | ||
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 | 85 | ||
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 | — | ||
Minimum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Defined Benefit Plan, Equity Securities, US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 2 | ||
Minimum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Defined Benefit Plan, Equity Securities, Non-US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | — | ||
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 | 52 | ||
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 | 5 | ||
Maximum [Member] | Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 42 | ||
Maximum [Member] | Qualified Defined Benefit [Member] | Defined Benefit Plan, Equity Securities, Non-US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 21 | ||
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 | 95 | ||
Maximum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Defined Benefit Plan, Equity Securities, US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 12 | ||
Maximum [Member] | Qualified Defined Benefit Plan - Salaried [Member] | Defined Benefit Plan, Equity Securities, Non-US | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Plan Assets, Investment Policy and Strategy, Description | 8 |
EMPLOYEE BENEFIT PLANS - FUNDED
EMPLOYEE BENEFIT PLANS - FUNDED STATUS (Details) - Qualified Defined Benefit [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Benefit obligation | |||
Beginning of year | $ 2,934 | $ 2,602 | |
Service cost | 52 | 46 | $ 42 |
Interest cost | 56 | 75 | 89 |
Actuarial (gain) loss | (171) | 339 | |
Defined Benefit Plan, Benefit Obligation, Benefits Paid | (117) | (134) | |
End of year | 2,758 | 2,934 | 2,602 |
Defined Benefit Plan Service Cost, including early-out expense | 56 | 52 | |
Plan assets at fair value | |||
Beginning of year | 2,488 | 2,239 | |
Actual return on plan assets | 224 | 383 | |
Employer contributions | 100 | 0 | |
Defined Benefit Plan, Plan Assets, Benefits Paid | (117) | (134) | |
End of year | 2,695 | 2,488 | $ 2,239 |
Funded status (unfunded) | $ (63) | $ (446) | |
Percent funded | 98.00% | 85.00% | |
Accumulated benefit obligation | $ 2,700 | $ 2,800 | |
Defined Benefit Plan, Plan Assets, Benefits Paid | $ 117 | $ 134 |
EMPLOYEE BENEFIT PLANS - AMOUNT
EMPLOYEE BENEFIT PLANS - AMOUNTS RECOGNIZED IN CONSOLIDATED BALANCE SHEETS (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Liability, Defined Benefit Plan [Abstract] | ||
Accrued benefit liability-long term | $ (305) | $ (665) |
Qualified Defined Benefit [Member] | ||
Liability, Defined Benefit Plan [Abstract] | ||
Accrued benefit liability-long term | (155) | (502) |
Plan assets-long term (within Other noncurrent assets) | 92 | 51 |
Total liability recognized | (63) | (451) |
Defined Benefit Plan, Accumulated Other Comprehensive (Income) Loss, before Tax [Abstract] | ||
Prior service credit | (4) | (5) |
Net loss | 316 | 626 |
Amount recognized in AOCL (pretax) | $ 312 | $ 621 |
EMPLOYEE BENEFIT PLANS - EXPECT
EMPLOYEE BENEFIT PLANS - EXPECTED AMORTIZATION FROM AOCI (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Qualified Defined Benefit [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Expected Return (Loss) on Plan Assets | $ 122 | $ 110 | $ 95 |
EMPLOYEE BENEFIT PLANS - NET PE
EMPLOYEE BENEFIT PLANS - NET PENSION EXPENSE (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | |||
Defined Benefit Plan, Benefit Obligation, Special and Contractual Termination Benefits | $ 0 | $ 11 | $ 0 |
Qualified Defined Benefit [Member] | |||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | |||
Service cost | 52 | 46 | 42 |
Interest cost | 56 | 75 | 89 |
Defined Benefit Plan, Expected Return (Loss) on Plan Assets | 122 | 110 | 95 |
Amortization of prior service cost | (1) | (1) | (1) |
Defined Benefit Plan, Amortization of Gain (Loss) | (37) | (35) | (37) |
Net pension expense | $ 22 | $ 56 | $ 72 |
EMPLOYEE BENEFIT PLANS - FUTURE
EMPLOYEE BENEFIT PLANS - FUTURE BENEFITS EXPECTED TO BE PAID (Details) - Qualified Defined Benefit [Member] $ in Millions | Dec. 31, 2021USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
2022 | $ 119 |
2023 | 128 |
2024 | 133 |
2025 | 149 |
2026 | 151 |
2027– 2031 | $ 830 |
EMPLOYEE BENEFIT PLANS EMPLOY_2
EMPLOYEE BENEFIT PLANS EMPLOYEE BENEFIT PLANS - POSTRETIREMENT MEDICAL BENEFITS (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Postretirement Medical Benefits [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Benefit obligation | $ 125 | $ 138 |
EMPLOYEE BENEFIT PLANS - DEFINE
EMPLOYEE BENEFIT PLANS - DEFINED CONTRIBUTION PLANS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |||
Total expense for the defined-contribution plans | $ 125 | $ 126 | $ 132 |
EMPLOYEE BENEFIT PLANS - PILOT
EMPLOYEE BENEFIT PLANS - PILOT LONG-TERM DISABILITY BENEFITS (Details) - Postretirement Health Coverage [Member] - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Defined Benefit Plan Disclosure [Line Items] | ||
Total liability net of a prefunded trust account | $ 77 | $ 61 |
Prefunded trust account | $ 8 | $ 7 |
EMPLOYEE BENEFIT PLANS - EMPLOY
EMPLOYEE BENEFIT PLANS - EMPLOYEE INCENTIVE-PAY PLANS (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |||
Operational Performance Rewards Program entitles all Air Group employees to maximum quarterly payouts (in dollars per quarter) | 450 | ||
Variable incentive pay | $ 151,000,000 | $ 130,000,000 | $ 163,000,000 |
EMPLOYEE BENEFIT PLANS - PROJEC
EMPLOYEE BENEFIT PLANS - PROJECTED BENEFIT OBLIGATION (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Pension Plan with Projected Benefit Obligation in Excess of Plan Assets, Projected Benefit Obligation | $ 1,750 | $ 2,207 |
Defined Benefit Plan, Plan with Accumulated Benefit Obligation in Excess of Plan Assets, Accumulated Benefit Obligation | 1,685 | 2,057 |
Defined Benefit Plan, Plan with Accumulated Benefit Obligation in Excess of Plan Assets, Plan Assets | $ 1,595 | $ 1,710 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES (Details) | 12 Months Ended | 20 Months Ended | |
Dec. 31, 2021USD ($)aircraft | Dec. 31, 2020USD ($) | Feb. 08, 2022aircraft | |
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Payments for Construction in Process | $ 71,000,000 | ||
LAX Construction, Amount Reimbursed | $ 8,700,000 | ||
LAX Redevelopment Project, Total Expected Outlay | $ 230,000,000 | ||
Loss Contingency Accrual | 22,000,000 | ||
Minimum [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Loss Contingency, Range of Possible Loss, Portion Not Accrued | 0 | ||
Loss Contingency, Range of Possible Loss, Portion Not Accrued | 0 | ||
Maximum [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Loss Contingency, Range of Possible Loss, Portion Not Accrued | 22,000,000 | ||
Loss Contingency, Range of Possible Loss, Portion Not Accrued | 22,000,000 | ||
Virgin America Flight Attendants [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Loss Contingency, Damages Sought, Value | 78,000,000 | ||
Loss Contingency, Damages Sought, Value | 78,000,000 | ||
Aircraft Commitments [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
2022 | 1,339,000,000 | ||
2023 | 1,686,000,000 | ||
2024 | 389,000,000 | ||
2025 | 79,000,000 | ||
2026 | 13,000,000 | ||
Thereafter | 0 | ||
Total | 3,506,000,000 | ||
Capacity Purchase Agreements[Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
2022 | 173,000,000 | ||
2023 | 178,000,000 | ||
2024 | 183,000,000 | ||
2025 | 188,000,000 | ||
2026 | 189,000,000 | ||
Thereafter | 688,000,000 | ||
Total | $ 1,599,000,000 | ||
B737 | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Commited to purchase (in aircraft) | aircraft | 74 | ||
Option to purchase additional (in aircraft) | aircraft | 52 | ||
E175 [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Commited to purchase (in aircraft) | aircraft | 7 | ||
Option to purchase additional (in aircraft) | aircraft | 15 | ||
E175 [Member] | Subsequent Event | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Commited to purchase (in aircraft) | aircraft | 5 | ||
Property Subject to Operating Lease [Member] | B737 | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 10 | ||
Property Subject to Operating Lease [Member] | B737 MAX [Member] | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 5 | ||
Property Subject to Operating Lease [Member] | Q400 | |||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |||
Operating leases, number of leased assets (in aircraft) | aircraft | 7 | ||
Property Subject to Operating Lease [Member] | Airbus | |||
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 |
SHAREHOLDER'S EQUITY SHAREHOLDE
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - STOCK CHANGES (Details) | Dec. 31, 2021$ / sharesshares |
Equity [Abstract] | |
Common stock, shares authorized | shares | 400,000,000 |
Common stock, par value | $ / shares | $ 0.01 |
SHAREHOLDER'S EQUITY SHAREHOL_2
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - DIVIDENDS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Subsequent Event [Line Items] | |||
Cash dividend paid | $ 0 | $ 45 | $ 173 |
SHAREHOLDER'S EQUITY - COMMON S
SHAREHOLDER'S EQUITY - COMMON STOCK REPURCHASE (Details) - USD ($) $ in Millions | 12 Months Ended | 64 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Aug. 31, 2015 | |
Equity, Class of Treasury Stock [Line Items] | ||||
Common stock repurchase (in shares) | 538,078 | 1,192,820 | ||
Common stock repurchase | $ 31 | $ 75 | ||
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) | 7,600,000 | |||
Common stock repurchase | $ 544 |
SHAREHOLDER'S EQUITY SHAREHOL_3
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - OTHER (Details) - shares | Dec. 31, 2021 | Dec. 31, 2020 |
Equity [Abstract] | ||
Treasury stock, shares | 9,349,944 | 9,349,944 |
SHAREHOLDER'S EQUITY SHAREHOL_4
SHAREHOLDER'S EQUITY SHAREHOLDERS' EQUITY - ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Equity [Abstract] | ||
Unrealized gain on marketable securities considered available-for-sale | $ (4) | $ 23 |
Related to employee benefit plans | (252) | (498) |
Related to interest rate derivatives | (6) | (19) |
Accumulated other comprehensive loss | $ (262) | $ (494) |
SHAREHOLDER'S EQUITY CARES Act
SHAREHOLDER'S EQUITY CARES Act Issuance (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 539,508 | |
Class of Warrant or Right, Outstanding | 1,882,518 | |
Adjustments to Additional Paid in Capital, Warrant Issued | $ 16 | |
US Treasury CARES Act Loan | ||
Class of Warrant or Right [Line Items] | ||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 6 | |
PSP 1 Warrants | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 31.61 | |
Class of Warrant or Right, Outstanding | 928,127 | |
CARES Act Loan Program Warrants | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 31.61 | |
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 427,080 | |
Class of Warrant or Right, Outstanding | 427,080 | |
PSP 2 Warrants | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 52.25 | |
Class of Warrant or Right, Outstanding | 305,499 | |
PSP 3 Warrants | ||
Class of Warrant or Right [Line Items] | ||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 66.39 | |
Class of Warrant or Right, Outstanding | 221,812 |
STOCK-BASED COMPENSATION PLAN_2
STOCK-BASED COMPENSATION PLANS (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 44 | $ 34 | $ 36 |
Tax benefit related to stock-based compensation | 11 | 8 | 9 |
Unrecognized stock-based compensation for non-vested options and awards | $ 24 | ||
Unrecognized stock-based compensation awards weighted-average period | 1 year 3 months 18 days | ||
Shares authorized under stock-based compensation plans (in shares) | 20,000,000 | ||
Shares remaining available for future grants (shares) | 6,990,817 | ||
Stock options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 5 | $ 4 | $ 3 |
Unrecognized stock-based compensation for non-vested options and awards | $ 4 | ||
Unrecognized stock-based compensation awards weighted-average period | 9 months 18 days | ||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |||
Expected volatility | 43.00% | 34.00% | 30.00% |
Expected term | 6 years | 6 years | 6 years |
Risk-free interest rate | 0.68% | 1.03% | 2.41% |
Expected dividend yield | 0.00% | 1.73% | 2.09% |
Weighted-average grant date fair value per share (in dollars per share) | $ 23.66 | $ 14.11 | $ 16.84 |
Estimated fair value of options granted (millions) | $ 4 | $ 6 | $ 4 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||
Outstanding, beginning balance (in shares) | 1,110,870 | ||
Granted (in Shares) | 164,010 | ||
Exercised (in shares) | (87,778) | ||
Canceled (in shares) | (6,860) | ||
Forfeited or expired (in shares) | (1,015) | ||
Outstanding, ending balance (in shares) | 1,179,227 | 1,110,870 | |
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) | $ 60.54 | ||
Granted, Weighted-Average Exercise Price Per Share (in dollars per share) | 58.59 | ||
Exercised, Weighted-Average Exercise Price Per Share (in dollars per share) | 34.33 | ||
Canceled, Weighted-Average Exercise Price Per Share (in dollars per share) | 79.69 | ||
Fofeited or expired, Weighted-Average Exercise Price Per Share (in dollars per share) | 55.74 | ||
Outstanding, ending balance, Weighted-Average Exercise Price Per Share (in dollars per share) | $ 62.11 | $ 60.54 | |
Outstanding, Weighted-Average Contractual Life | 6 years 8 months 12 days | 6 years 9 months 18 days | |
Outstanding, Aggregate Intrinsic Value | $ 3 | $ 4 | |
Exercisable, Outstanding (in shares) | 556,790 | ||
Exercisable, Weighted-Average Exercise Price Per Share (in dollars per share) | $ 65.51 | ||
Exercisable, Weighted-Average Contractual Life | 5 years 4 months 24 days | ||
Exercisable, Aggregate Intrinsic Value | $ 1 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest [Abstract] | |||
Vested or expected to vest, Shares | 1,178,425 | ||
Vested or expected to vest, Weighted-Average Exercise Price Per Share (in dollars per share) | $ 62.11 | ||
Vested or expected to vest, Weighted-Average Contractual Life | 6 years 8 months 12 days | ||
Vested or expected to vest, Aggregate Intrinsic Value | $ 3 | ||
Intrinsic value of option exercises | 3 | 2 | 1 |
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 | 4 | 3 | 3 |
Stock awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | 20 | $ 14 | 21 |
Unrecognized stock-based compensation for non-vested options and awards | $ 20 | ||
Unrecognized stock-based compensation awards weighted-average period | 1 year 3 months 18 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) | 967,044 | ||
Granted (in shares) | 387,541 | ||
Vested (in shares) | (547,725) | ||
Forfeited (in shares) | (260,380) | ||
Non-vested, ending balance (in shares) | 546,480 | 967,044 | |
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) | $ 51.85 | ||
Granted, Weighted-Average Grant Date Fair Value (in dollars per share) | 65.42 | ||
Vested, Weighted-Average Grant Date Fair Value (in dollars per share) | 55.77 | ||
Forfeited, Weighted-Average Grant Date Fair Value (in dollars per share) | 53.76 | ||
Non-vested, ending balance, Weighted-Average Price Per Share (in dollars per share) | $ 52.81 | $ 51.85 | |
Non-vested, Weighted-Average Contractual Life | 1 year 3 months 18 days | 1 year 8 months 12 days | |
Non-vested, Total Instrinsic Value (in dollars) | $ 36 | $ 50 | |
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 | $ 18 | $ 15 | $ 11 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Granted (in shares) | 1,254,393 | 1,524,194 | 784,786 |
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, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Operating revenues | ||||
Total Operating Revenues | $ 6,176 | $ 3,566 | $ 8,781 | |
Operating expenses | ||||
Operating expenses, excluding fuel | 4,212 | 4,618 | 5,840 | |
Special items - merger-related costs | 0 | 6 | 44 | |
Economic fuel | 1,279 | 723 | 1,878 | |
Total Operating Expenses | 5,491 | 5,341 | 7,718 | |
Non-operating Income (Expense) | ||||
Interest income | 25 | 31 | 42 | |
Interest expense | (128) | (98) | (78) | |
Interest capitalized | 11 | 11 | 15 | |
Other - net | 36 | 17 | (26) | |
Nonoperating Income (Expense) Total | (56) | (65) | (47) | |
Income before income tax | 629 | (1,840) | 1,016 | |
Depreciation | 394 | 420 | 423 | |
Total property and equipment additions | (292) | (222) | (696) | |
Total assets | 13,951 | 14,046 | ||
Air Group Adjusted [Member] | ||||
Operating revenues | ||||
Total Operating Revenues | 6,176 | 3,566 | 8,781 | |
Operating expenses | ||||
Operating expenses, excluding fuel | 5,137 | 4,547 | 5,796 | |
Economic fuel | 1,326 | 731 | 1,884 | |
Total Operating Expenses | 6,463 | 5,278 | 7,680 | |
Non-operating Income (Expense) | ||||
Nonoperating Income (Expense) Total | (56) | (39) | (47) | |
Income before income tax | (343) | (1,751) | 1,054 | |
Horizon [Member] | ||||
Operating revenues | ||||
Total Operating Revenues | 406 | 386 | 451 | |
Operating expenses | ||||
Operating expenses, excluding fuel | 373 | 323 | 385 | |
Economic fuel | 0 | 0 | 0 | |
Total Operating Expenses | 373 | 323 | 385 | |
Non-operating Income (Expense) | ||||
Nonoperating Income (Expense) Total | (21) | (22) | (28) | |
Income before income tax | 12 | 41 | 38 | |
Depreciation | 71 | 74 | 86 | |
Total property and equipment additions | (56) | (12) | (91) | |
Total assets | 1,212 | 1,170 | ||
Consolidating & Other | ||||
Operating revenues | ||||
Total Operating Revenues | (402) | (383) | (445) | |
Operating expenses | ||||
Operating expenses, excluding fuel | (433) | (399) | (464) | |
Economic fuel | 0 | 0 | 0 | |
Total Operating Expenses | (433) | (399) | (464) | |
Non-operating Income (Expense) | ||||
Nonoperating Income (Expense) Total | 3 | 2 | 2 | |
Income before income tax | 34 | 18 | 21 | |
Total assets | (6,519) | (6,878) | ||
Special Charges [Member] | ||||
Operating revenues | ||||
Total Operating Revenues | 0 | 0 | 0 | |
Operating expenses | ||||
Operating expenses, excluding fuel | (925) | 71 | 44 | |
Economic fuel | (47) | (8) | (6) | |
Total Operating Expenses | (972) | 63 | 38 | |
Non-operating Income (Expense) | ||||
Nonoperating Income (Expense) Total | 0 | (26) | 0 | |
Income before income tax | 972 | (89) | (38) | |
Alaska Mainline [Member] | ||||
Operating revenues | ||||
Total Operating Revenues | 5,025 | 2,829 | 7,381 | |
Operating expenses | ||||
Operating expenses, excluding fuel | 4,101 | 3,630 | 4,778 | |
Economic fuel | 1,065 | 569 | 1,589 | |
Total Operating Expenses | 5,166 | 4,199 | 6,367 | |
Non-operating Income (Expense) | ||||
Nonoperating Income (Expense) Total | (38) | (19) | (21) | |
Income before income tax | (179) | (1,389) | 993 | |
Depreciation | [1] | 323 | 346 | 337 |
Total property and equipment additions | [1] | (236) | (210) | (605) |
Total assets | [1] | 19,258 | 19,754 | |
Alaska Regional [Member] | ||||
Operating revenues | ||||
Total Operating Revenues | 1,147 | 734 | 1,394 | |
Operating expenses | ||||
Operating expenses, excluding fuel | 1,096 | 993 | 1,097 | |
Economic fuel | 261 | 162 | 295 | |
Total Operating Expenses | 1,357 | 1,155 | 1,392 | |
Non-operating Income (Expense) | ||||
Nonoperating Income (Expense) Total | 0 | 0 | 0 | |
Income before income tax | (210) | (421) | 2 | |
Passenger Revenue [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 5,499 | 3,019 | 8,095 | |
Passenger Revenue [Member] | Air Group Adjusted [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 5,499 | 3,019 | 8,095 | |
Passenger Revenue [Member] | Horizon [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |
Passenger Revenue [Member] | Consolidating & Other | ||||
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 | 0 | 0 | 0 | |
Passenger Revenue [Member] | Alaska Mainline [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 4,411 | 2,350 | 6,750 | |
Passenger Revenue [Member] | Alaska Regional [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 1,088 | 669 | 1,345 | |
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 | 0 | 0 | 0 | |
Capacity Purchase Agreements [Member] | Horizon [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 406 | 386 | 450 | |
Capacity Purchase Agreements [Member] | Consolidating & Other | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | (406) | (386) | (450) | |
Capacity Purchase Agreements [Member] | Special Charges [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 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 | |
Mileage Plan Services, Other [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 461 | 374 | 465 | |
Mileage Plan Services, Other [Member] | Air Group Adjusted [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 461 | 374 | 465 | |
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] | Consolidating & Other | ||||
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 | 0 | 0 | 0 | |
Mileage Plan Services, Other [Member] | Alaska Mainline [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 402 | 309 | 419 | |
Mileage Plan Services, Other [Member] | Alaska Regional [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 59 | 65 | 46 | |
Cargo and Freight [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 216 | 173 | 221 | |
Cargo and Freight [Member] | Air Group Adjusted [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 216 | 173 | 221 | |
Cargo and Freight [Member] | Horizon [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 1 | |
Cargo and Freight [Member] | Consolidating & Other | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 4 | 3 | 5 | |
Cargo and Freight [Member] | Special Charges [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 0 | 0 | 0 | |
Cargo and Freight [Member] | Alaska Mainline [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | 212 | 170 | 212 | |
Cargo and Freight [Member] | Alaska Regional [Member] | ||||
Operating revenues | ||||
Revenue from Contract with Customer, Excluding Assessed Tax | $ 0 | $ 0 | $ 3 | |
[1] | 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): 2021 2020 Excess of tax over book depreciation $ 1,145 $ 1,126 Intangibles - net 19 15 Operating lease assets 351 342 Other - net 76 106 Deferred tax liabilities 1,591 1,589 Mileage Plan (416) (385) Inventory obsolescence (17) (17) Employee benefits (127) (215) Net operating losses (25) (27) Operating lease liabilities (374) (381) Leasehold maintenance (40) (73) Other - net (34) (103) Deferred tax assets (1,033) (1,201) Valuation allowance 20 19 Net deferred tax liabilities $ 578 $ 407 At December 31, 2021, the Company has paid gross taxes of $52 million and expect to pay $21 million more for the tax year 2021. The Company is also awaiting payment of a $285 million federal tax refund receivable as a result of carrying back losses from the 2020 tax year and other various amendments of prior year tax returns. The Company also has gross state NOLs of approximately $413 million that expire beginning in 2023 and continuing through 2041. 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. During 2021, all remaining NOLs acquired through the acquisition of Virgin America were utilized to offset federal taxable income. 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 state NOL carryforward will not be realized and, therefore, has provided a valuation allowance of $20 million for that portion as of December 31, 2021. The Company has likewise concluded it is more likely than not that all of its federal and the remaining state deferred income tax assets will be realized and thus no additional valuation allowance has been recorded. The Company reassesses the need for a valuation allowance each reporting period. Components of Income Tax Expense (Benefit) The components of income tax expense (benefit) are as follows (in millions): 2021 2020 2019 Current income tax expense (benefit): Federal $ 40 $ (212) $ 26 State 16 (11) 13 Total current income tax expense (benefit) 56 (223) 39 Deferred income tax expense (benefit): Federal 80 (246) 175 State 15 (47) 33 Total deferred income tax expense (benefit) 95 (293) 208 Income tax expense (benefit) $ 151 $ (516) $ 247 Income Tax Rate Reconciliation Income tax expense (benefit) reconciles to the amount computed by applying the 2021 U.S. federal rate of 21% to income (loss) before income tax and for deferred taxes as follows (in millions): 2021 2020 2019 Income (loss) before income tax $ 629 $ (1,840) $ 1,016 Expected tax expense (benefit) 132 (386) 213 Nondeductible expenses 10 9 9 State income taxes 20 (62) 36 Tax law changes (14) (93) (9) Valuation allowance 1 18 — Other - net 2 (2) (2) Actual tax expense (benefit) $ 151 $ (516) $ 247 Effective tax rate 24.0 % 28.0 % 24.3 % The Company recorded a current tax benefit of $14 million in 2021 as a result of provisions outlined in the CARES Act. As a result of tax changes signed into law during 2017, with final regulations issued in 2019, the Company recorded a current tax benefit of $93 million in 2020. 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 2020 Alaska 2015 to 2020 California 2007 to 2020 Oregon 2003 to 2020 Certain tax years are open to the extent of net operating loss carryforwards. Changes in the liability for gross unrecognized tax benefits during 2021, 2020 and 2019 are as follows (in millions): 2021 2020 2019 Balance at January 1, $ 35 $ 40 $ 40 Additions related to prior years 3 1 — Releases related to prior years — (1) (1) Additions related to current year activity 3 — 2 Releases due to settlements — (4) — Releases due to lapse of statute of limitations — (1) (1) Balance at December 31, $ 41 $ 35 $ 40 As of December 31, 2021, the Company had $41 million of accrued tax contingencies, of which $34 million, if fully recognized, would increase the effective tax rate. As of December 31, 2021, 2020 and 2019, the Company has accrued interest and penalties, net of federal income tax benefit, of $8 million, $6 million, and $7 million. In 2021, the Company recognized an expense of $2 million, compared to a benefit of $1 million in 2020, and expense of $1 million in 2019, for interest and penalties, net of federal income tax benefit. At December 31, 2021, the Company has unrecognized tax benefits recorded as a liability. The Company increased its reserves for uncertain tax positions in 2021 by $6 million, primarily due to current year activity and amended returns. 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, 2021. |