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Fair Value Measurements (Tables)
 12 Months Ended
Dec. 31, 2017
Fair Value Disclosures [Abstract]  
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2017, and December 31, 2016:

 
 
 
 
Fair value measurements at reporting date using:
 
 
 
 
Quoted prices in
active markets
for identical assets
 
Significant
other observable
inputs
 
Significant
unobservable
inputs
Description
 
December 31, 2017
 
(Level 1)
 
(Level 2)
 
(Level 3)
Assets
 
(in millions)
Cash equivalents
 
 
 
 
 
 
 
 
Cash equivalents (a)
 
$
1,133

 
$
1,133

 
$
—

 
$
—

Commercial paper
 
350

 
—

 
350

 
—

Certificates of deposit
 
12

 
—

 
12

 
—

Short-term investments:
 
 
 
 
 
 
 
 
Treasury bills
 
1,491

 
1,491

 
—

 
—

Certificates of deposit
 
287

 
—

 
287

 
—

Fuel derivatives:
 
 
 
 
 
 
 
 
Option contracts (b)
 
283

 
—

 
—

 
283

Other available-for-sale securities
 
107

 
107

 
—

 
—

Total assets
 
$
3,663

 
$
2,731

 
$
649

 
$
283

Liabilities
 
 
 
 
 
 
 
 
Fuel derivatives:
 
 
 
 
 
 
 
 
Option contracts (b)
 
(35
)
 
—

 
—

 
(35
)
Interest rate derivatives (see Note 10)
 
(22
)
 
—

 
(22
)
 
—

Total liabilities
 
$
(57
)
 
$
—

 
$
(22
)
 
$
(35
)

(a) Cash equivalents are primarily composed of money market investments.
(b) In the Consolidated Balance Sheet amounts are presented as a net asset. See Note 10.


 
 
 
 
Fair value measurements at reporting date using:
 
 
 
 
Quoted prices in
active markets
for identical assets
 
Significant
other observable
inputs
 
Significant
unobservable
inputs
Description
 
December 31, 2016
 
(Level 1)
 
(Level 2)
 
(Level 3)
Assets
 
(in millions)
Cash equivalents
 
 
 
 
 
 
 
 
Cash equivalents (a)
 
$
1,344

 
$
1,344

 
$
—

 
$
—

Commercial paper
 
325

 
—

 
325

 
—

Certificates of deposit
 
11

 
—

 
11

 
—

Short-term investments:
 
 
 
 
 
 
 
 
Treasury bills
 
1,345

 
1,345

 
—

 
—

Certificates of deposit
 
280

 
—

 
280

 
—

Fuel derivatives:
 
 
 
 
 
 
 
 
Swap contracts (c)
 
42

 
—

 
42

 
—

Option contracts (b)
 
239

 
—

 
—

 
239

Option contracts (c)
 
163

 
—

 
—

 
163

Other available-for-sale securities
 
83

 
83

 
—

 
—

Total assets
 
$
3,832

 
$
2,772

 
$
658

 
$
402

Liabilities
 
 
 
 
 
 
 
 
Fuel derivatives:
 
 
 
 
 
 
 
 
Swap contracts (c)
 
$
(110
)
 
$
—

 
$
(110
)
 
$
—

Option contracts (b)
 
(96
)
 
—

 
—

 
(96
)
Option contracts (c)
 
(564
)
 
—

 
—

 
(564
)
Interest rate derivatives (see Note 10)
 
(35
)
 
—

 
(35
)
 
—

Total liabilities
 
$
(805
)
 
$
—

 
$
(145
)
 
$
(660
)

(a) Cash equivalents are primarily composed of money market investments.
(b) In the Consolidated Balance Sheet amounts are presented as a net asset. See Note 10.
(c) In the Consolidated Balance Sheet amounts are presented as a net liability. See Note 10.
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Input Reconciliation
The following tables present the Company’s activity for items measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for 2017 and 2016:

Fair value measurements using significant unobservable inputs (Level 3)
 
Fuel
 
(in millions)
derivatives
 
Balance at December 31, 2016
$
(258
)
 
Total losses (realized or unrealized)
 

 
Included in earnings
(125
)
 
Included in other comprehensive income
(50
)
 
Purchases
142

(a)
Sales
—

(a)
Settlements
539

 
Balance at December 31, 2017
$
248

 
The amount of total losses for the period
  included in earnings attributable to the
  change in unrealized gains or losses relating
  to assets still held at December 31, 2017
$
(42
)
 

(a) The purchase and sale of fuel derivatives are recorded gross based on the structure of the derivative instrument and
whether a contract with multiple derivatives is purchased as a single instrument or separate instruments.

Fair value measurements using significant unobservable inputs (Level 3)
 
Fuel
 
Other
 
 
(in millions)
derivatives
 
securities
 
Total
Balance at December 31, 2015
$
(1,676
)
 
$
27

 
$
(1,649
)
Total gains (losses) (realized or unrealized)
 

 
 

 
 

Included in earnings
175

 
(2
)
 
173

Included in other comprehensive income
201

 
8

 
209

Purchases
221

(a)
—

 
221

Sales
(61
)
(a)
(33
)
 
(94
)
Settlements
882

 
—

 
882

Balance at December 31, 2016
$
(258
)

$
—


$
(258
)
The amount of total gains for the period
  included in earnings attributable to the
  change in unrealized gains or losses relating
  to assets still held at December 31, 2016
$
93

 
$
—

 
$
93


(a) The purchase and sale of fuel derivatives are recorded gross based on the structure of the derivative instrument and
whether a contract with multiple derivatives is purchased as a single instrument or separate instruments.
Fair Value Valuation Techniques
The following table presents a range of the unobservable inputs utilized in the fair value measurements of the Company’s fuel derivatives classified as Level 3 at December 31, 2017:

Quantitative information about Level 3 fair value measurements
 
Valuation technique
Unobservable input
Period (by year)
Range
Fuel derivatives
Option model
Implied volatility
2018
11-26%
 
 
 
2019
17-22%
 
 
 
2020
17-21%
 
 
 
Beyond 2020
18-20%
Fair value, by Balance Sheet Grouping
(in millions)
 Carrying value
 
Estimated fair value
 
Fair value level hierarchy
French Credit Agreements due 2018 - 2.54%
$
1

 
$
1

 
Level 3
Fixed-rate 737 Aircraft Notes payable through 2018 - 7.03%
3

 
3

 
Level 3
2.75% Notes due 2019
300

 
302

 
Level 2
Term Loan Agreement payable through 2019 - 6.315%
66

 
66

 
Level 3
Term Loan Agreement payable through 2019 - 4.84%
19

 
20

 
Level 3
2.65% Notes due 2020
491

 
494

 
Level 2
Term Loan Agreement payable through 2020 - 5.223%
237

 
240

 
Level 3
737 Aircraft Notes payable through 2020
155

 
154

 
Level 3
2.75% Notes due 2022
300

 
300

 
Level 2
Pass Through Certificates due 2022 - 6.24%
294

 
318

 
Level 2
Term Loan Agreement payable through 2026 - 2.67%
215

 
215

 
Level 3
3.00% Notes due 2026
300

 
293

 
Level 2
3.45% Notes due 2027
300

 
299

 
Level 2
7.375% Debentures due 2027
127

 
154

 
Level 2