Special Items, Net (Tables)

6 Months Ended

Jun. 30, 2020

Restructuring Cost and Reserve [Line Items]

Components of Special Items, Net in Condensed Consolidated Statements of Operations

Special items, net in the condensed consolidated statements of operations consisted of the following (in millions):



	Three Months Ended June 30,					Six Months Ended June 30,
	2020			2019		2020			2019
PSP Financial Assistance ⁽¹⁾	$	(1,803	)	$	—	$	(1,803	)	$	—
Severance expenses ⁽²⁾	332			—		537			—
Labor contract expenses ⁽³⁾	10			—		228			—
Fleet impairment ⁽⁴⁾	—			—		743			—
Fleet restructuring expenses ⁽⁵⁾	—			77		—			160
Merger integration expenses	—			39		—			76
Mark-to-market adjustments on bankruptcy obligations, net ⁽⁶⁾	—			5		(49		)	5
Other operating special items, net	(33		)	—		(18		)	18
Mainline operating special items, net	(1,494		)	121		(362		)	259

PSP Financial Assistance ⁽¹⁾	(216		)	—		(216		)	—
Fleet impairment ⁽⁴⁾	24			—		117			—
Severance expenses ⁽²⁾	14			—		14			—
Regional operating special items, net	(178		)	—		(85		)	—
Operating special items, net	(1,672		)	121		(447		)	259

Mark-to-market adjustments on equity and other investments, net ⁽⁷⁾	—			61		180			(9		)
Debt refinancing, extinguishment and other charges	11			8		48			8
Nonoperating special items, net	11			69		228			(1		)


⁽¹⁾	PSP Financial Assistance represents recognition of a portion of financial assistance received from Treasury pursuant to the PSP Agreement. See Note 1 for further information.


⁽²⁾	Severance expenses principally include salary and medical costs associated with certain team members who opted in to voluntary early retirement programs offered as a result of reductions to our operation due to COVID-19.


⁽³⁾	Labor contract expenses primarily relate to one-time charges resulting from the ratification of a new contract with the Transport Workers Union and International Association of Machinists & Aerospace Workers for our maintenance and fleet service team members, including signing bonuses and adjustments to vacation accruals resulting from pay rate increases.


⁽⁴⁾	Fleet impairment resulted from our decision to retire certain aircraft earlier than planned driven by the decline in air travel due to COVID-19. Aircraft retired include Boeing 757, Boeing 767, Airbus A330-300, Embraer 190, certain Embraer 140 and Bombardier CRJ200 aircraft.

The three months ended June 30, 2020 primarily included a non-cash write-down of regional aircraft and spare parts. The six months ended June 30, 2020 included a $784 million non-cash write-down of mainline and regional aircraft and spare parts and $76 million in write-offs of ROU assets and lease return costs. See Note 13 for further information related to these charges.


⁽⁵⁾	Fleet restructuring expenses principally included accelerated depreciation and rent expense for aircraft and related equipment expected to be retired earlier than planned.


⁽⁶⁾	Bankruptcy obligations that will be settled in shares of our common stock are marked-to-market based on our stock price.

⁽⁷⁾

Mark-to-market adjustments on equity and other investments, net primarily relates to net unrealized gains and losses associated with our equity investment in China Southern Airlines Company Limited (China Southern Airlines) and certain treasury rate lock derivative instruments.

American Airlines, Inc. [Member]

Restructuring Cost and Reserve [Line Items]

Components of Special Items, Net in Condensed Consolidated Statements of Operations

Special items, net in the condensed consolidated statements of operations consisted of the following (in millions):



	Three Months Ended June 30,					Six Months Ended June 30,
	2020			2019		2020			2019
PSP Financial Assistance ⁽¹⁾	$	(1,803	)	$	—	$	(1,803	)	$	—
Severance expenses ⁽²⁾	332			—		537			—
Labor contract expenses ⁽³⁾	10			—		228			—
Fleet impairment ⁽⁴⁾	—			—		743			—
Fleet restructuring expenses ⁽⁵⁾	—			77		—			160
Merger integration expenses	—			39		—			76
Mark-to-market adjustments on bankruptcy obligations, net ⁽⁶⁾	—			5		(49		)	5
Other operating special items, net	(33		)	—		(18		)	18
Mainline operating special items, net	(1,494		)	121		(362		)	259

PSP Financial Assistance ⁽¹⁾	(216		)	—		(216		)	—
Fleet impairment ⁽⁴⁾	13			—		106			—
Regional operating special items, net	(203		)	—		(110		)	—
Operating special items, net	(1,697		)	121		(472		)	259

Mark-to-market adjustments on equity and other investments, net ⁽⁷⁾	—			61		180			(9		)
Debt refinancing, extinguishment and other charges	11			8		48			8
Nonoperating special items, net	11			69		228			(1		)


⁽¹⁾	PSP Financial Assistance represents recognition of a portion of financial assistance received from Treasury pursuant to the PSP Agreement. See Note 1 for further information.


⁽²⁾	Severance expenses principally include salary and medical costs associated with certain team members who opted in to voluntary early retirement programs offered as a result of reductions to American's operation due to COVID-19.


⁽³⁾	Labor contract expenses primarily relate to one-time charges resulting from the ratification of a new contract with the Transport Workers Union and International Association of Machinists & Aerospace Workers for American's maintenance and fleet service team members, including signing bonuses and adjustments to vacation accruals resulting from pay rate increases.


⁽⁴⁾	Fleet impairment resulted from American's decision to retire certain aircraft earlier than planned driven by the decline in air travel due to COVID-19. Aircraft retired include Boeing 757, Boeing 767, Airbus A330-300, Embraer 190, certain Embraer 140 and Bombardier CRJ200 aircraft.

The three months ended June 30, 2020 primarily included a non-cash write-down of regional aircraft and spare parts. The six months ended June 30, 2020 included a $773 million non-cash write-down of mainline and regional aircraft and spare parts and $76 million in write-offs of ROU assets and lease return costs. See Note 12 for further information related to these charges.


⁽⁵⁾	Fleet restructuring expenses principally included accelerated depreciation and rent expense for aircraft and related equipment expected to be retired earlier than planned.


⁽⁶⁾	Bankruptcy obligations that will be settled in shares of AAG common stock are marked-to-market based on AAG's stock price.

⁽⁷⁾

Mark-to-ma