Financial Instruments and Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2013

Financial Assets and Liabilities Measured at Fair Value on Recurring Basis

The table below presents disclosures about the financial assets and financial liabilities measured at fair value on a recurring basis in the Company’s financial statements (in millions):

	June 30, 2013											December 31, 2012
	Total			Level 1		Level 2			Level 3			Total			Level 1		Level 2		Level 3
	UAL
Cash and cash equivalents	$	4,143		$	4,143	$	—		$	—		$	4,770		$	4,770	$	—	$	—
Short-term investments:
Asset-backed securities		762			—		762			—			715			—		715		—
Corporate debt		511			—		511			—			537			—		537		—
Certificates of deposit placed through an account registry service (“CDARS”)		358			—		358			—			367			—		367		—
Auction rate securities		115			—		—			115			116			—		—		116
Other short-term investments		75			—		75			—			38			—		38		—
Enhanced equipment trust certificates (“EETC”)		62			—		—			62			63			—		—		63
Fuel derivative asset (liability), net		(23	)		—		(23	)		—			46			—		46		—
Foreign currency derivatives, net		1			—		1			—			—			—		—		—
Restricted cash		435			435		—			—			447			447		—		—
	United
Cash and cash equivalents	$	4,137		$	4,137	$	—		$	—		$	4,765		$	4,765	$	—	$	—
Short-term investments:
Asset-backed securities		762			—		762			—			715			—		715		—
Corporate debt		511			—		511			—			537			—		537		—
CDARS		358			—		358			—			367			—		367		—
Auction rate securities		115			—		—			115			116			—		—		116
Other short-term investments		75			—		75			—			38			—		38		—
EETC		62			—		—			62			63			—		—		63
Fuel derivative asset (liability), net		(23	)		—		(23	)		—			46			—		46		—
Foreign currency derivatives, net		1			—		1			—			—			—		—		—
Restricted cash		435			435		—			—			447			447		—		—
Convertible debt derivative asset		395			—		—			395			268			—		—		268
Convertible debt option liability		(199	)		—		—			(199	)		(128	)		—		—		(128	)

Activity for "Level Three" Financial Assets and Financial Liabilities

The tables below present disclosures about the activity for “Level 3” financial assets and financial liabilities (in millions):

	Three Months Ended June 30,
	2013				2012
UAL	Auction Rate Securities		EETC		Auction Rate Securities		EETC
Balance at March 31	$	108	$	61	$	112	$	62
Settlements		—		—		—		—
Gains (losses):
Reported in earnings—realized		—		—		—		—
Reported in earnings—unrealized		—		—		—		—
Reported in other comprehensive income (loss)		7		1		—		1
Balance at June 30	$	115	$	62	$	112	$	63

	Six Months Ended June 30,
	2013						2012
UAL	Auction Rate Securities			EETC			Auction Rate Securities			EETC
Balance at January 1	$	116		$	63		$	113		$	60
Settlements		(10	)		(2	)		—			(2	)
Gains (losses):
Reported in earnings—realized		2			—			—			—
Reported in earnings—unrealized		1			—			(1	)		—
Reported in other comprehensive income (loss)		6			1			—			5
Balance at June 30	$	115		$	62		$	112		$	63

	Three Months Ended June 30,
	2013										2012
United	Auction Rate Securities		Convertible Debt Supplemental Derivative Asset			Convertible Debt Conversion Option Liability			EETC		Auction Rate Securities		Convertible Debt Supplemental Derivative Asset		Convertible Debt Conversion Option Liability			EETC
Balance at March 31	$	108	$	413		$	(209	)	$	61	$	112	$	231	$	(119	)	$	62
Settlements		—		—			—			—		—		—		—			—
Gains (losses):
Reported in earnings:
Realized		—		—			—			—		—		—		—			—
Unrealized		—		(18	)		10			—		—		58		(28	)		—
Reported in other comprehensive income (loss)		7		—			—			1		—		—		—			1
Balance at June 30	$	115	$	395		$	(199	)	$	62	$	112	$	289	$	(147	)	$	63

	Six Months Ended June 30,
	2013											2012
United	Auction Rate Securities			Convertible Debt Supplemental Derivative Asset		Convertible Debt Conversion Option Liability			EETC			Auction Rate Securities			Convertible Debt Supplemental Derivative Asset		Convertible Debt Conversion Option Liability			EETC
Balance at January 1	$	116		$	268	$	(128	)	$	63		$	113		$	193	$	(95	)	$	60
Settlements		(10	)		—		—			(2	)		—			—		—			(2	)
Gains (losses):
Reported in earnings:
Realized		2			—		—			—			—			—		—			—
Unrealized		1			127		(71	)		—			(1	)		96		(52	)		—
Reported in other comprehensive income (loss)		6			—		—			1			—			—		—			5
Balance at June 30	$	115		$	395	$	(199	)	$	62		$	112		$	289	$	(147	)	$	63

Carrying Values and Estimated Fair Values of Financial Instruments

The table below presents the carrying values and estimated fair values of financial instruments not presented in the tables above (in millions):

	Fair Value of Debt by Fair Value Hierarchy Level
	June 30, 2013										December 31, 2012
	Carrying Amount		Fair Value								Carrying Amount		Fair Value
			Total		Level 1		Level 2		Level 3				Total		Level 1		Level 2		Level 3
UAL debt	$	11,123	$	12,153	$	—	$	7,589	$	4,564	$	12,252	$	13,419	$	—	$	8,045	$	5,374
United debt		10,916		11,553		—		6,989		4,564		11,850		12,460		—		7,086		5,374

Quantitative Information about Level 3 Fair Value Measurements

Quantitative Information About Level 3 Fair Value Measurements (in millions)
Item	Fair Value at June 30, 2013			Valuation Technique	Unobservable Input	Range (Weighted Average)
Auction rate securities	$	115		Valuation Service / Broker Quotes	Broker quotes (a)	NA
EETC		62		Discounted Cash Flows	Structure credit risk (b)	5%
Convertible debt derivative asset		395		Binomial Lattice Model	Expected volatility (c) Own credit risk (d)	45% - 60% (47%) 6%
Convertible debt option liability		(199	)	Binomial Lattice Model	Expected volatility (c) Own credit risk (d)	45% - 60% (47%) 6%

(a) Broker quotes obtained by a third-party valuation service.

(b) Represents the credit risk premium of the EETC structure above the risk-free rate that the Company has determined market participants would use in pricing the instruments.

(c) Represents the range in volatility estimates that the Company has determined market participants would use when pricing the instruments.

(d) Represents the range of Company-specific risk adjustments that the Company has determined market participants would use as a model input.