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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2012

Asset Measured at Fair Value on Recurring Basis

The following tables present our assets that are measured at fair value on a recurring basis and are categorized using the three levels of fair value hierarchy:


September 30, 2012	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money market funds	$	334	$	334	$	–	$	–
Available-for-sale investments:
EETC		4		–		–		4
Interest rate swaps		30		–		30		–
Total	$	368	$	334	$	30	$	4


December 31, 2011	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets
Money market funds	$	218	$	218	$	–	$	–
Available-for-sale investments:
EETC		5		–		–		5
Interest rate swaps		29		–		29		–
Total	$	252	$	218	$	29	$	5

Reconciliation of Assets Measured at Fair Value on a Recurring Basis

The following tables present a reconciliation of Level 3 assets measured at fair value on a recurring basis for the nine months ended September 30:


2012	Fair Value Beginning of Year		Realized Gains Included in Income		Accumulated Other Comprehensive Income/(Loss)		Settlements			Transfers In/(Out)		Fair Value at End of Period
Assets
EETC	$	5	$	–	$	–	$	(1	)	$	–	$	4
Total	$	5	$	–	$	–	$	(1	)	$	–	$	4


2011
Assets
EETC	$	5	$	–	$	–	$	(1	)	$	–	$	4
Total	$	5	$	–	$	–	$	(1	)	$	–	$	4

Assets Measured at Fair Value on Non-Recurring Basis

The table below presents the non-recurring losses recognized for the nine months ended September 30, and the fair value and asset classification of the related assets as of the impairment date:


	2012					2011
	Fair Value		Total Losses			Fair Value			Total Losses
Assets
Equipment under operating leases	$	12	$	(2	)	$	96	⁽¹⁾	$	(49	)
Assets held for sale or re-lease		13		(12	)		15	⁽¹⁾		(4	)
Total	$	25	$	(14	)	$	111		$	(53	)

⁽¹⁾

For an asset that incurred impairments in both Equipment under operating leases and Assets held for sale or re-lease, the losses are reflected in the asset’s classification as of the time of the respective impairments while the fair value of the asset as of the date of the latest impairment is reflected only in the asset’s then current classification. As of September 30, 2011, such asset with a fair value of $7 changed classification from Equipment under operating leases to Assets held for sale or re-lease.

Fair Value of Assets Measurement Date, Valuation Techniques and Related Unobservable Inputs of Those Assets

For Level 3 assets that were measured at fair value on a non-recurring basis during the nine months ended September 30, 2012, the following table presents the fair value of those assets as of the measurement date, valuation techniques and related unobservable inputs of those assets.

Fair
Value

Valuation
Techniques

Unobservable
Input

Quantitative

Inputs Used

Equipment under operating leases & Assets held for sale or re-lease

Market approach

Aircraft value
publications

$24 - $53⁽¹⁾

Median $35

Aircraft condition
adjustments

$(10) - $0⁽²⁾
Net $(10)

⁽¹⁾

The range represents the sum of the highest and lowest values for all aircraft subject to fair value measurement, according to the third party aircraft valuation publications that we use in our valuation process.

⁽²⁾

The negative amount represents the sum for all aircraft subject to fair value measurement, of all downward adjustments based on consideration of individual aircraft attributes and condition. The positive amount represents the sum of all such upward adjustments.

Carrying Values and Estimated Fair Values of Our Financial Instruments

The following table presents the carrying values and estimated fair values of our financial instruments for which we did not elect the fair value option:


	September 30, 2012						December 31, 2011
	Carrying Value			Fair Value Level 2			Carrying Value			Fair Value
Assets
Notes and other	$	552	⁽¹⁾	$	610		$	594	⁽¹⁾	$	639
Liabilities
Debt, excluding capital lease obligations	$	(2,532	)	$	(2,708	)	$	(3,357	)	$	(3,497	)

⁽¹⁾

At September 30, 2012 and December 31, 2011, net of allowance for losses of $24 and $27.

- Definition

Tabular disclosure of assets and liabilities by class, including financial instruments measured at fair value that are classified in shareholders' equity, if any, that are measured at fair value on a nonrecurring basis in periods after initial recognition (for example, impaired assets). Disclosures may include, but are not limited to: (a) the fair value measurements recorded and the reasons for the measurements and (b) the level within the fair value hierarchy in which the fair value measurements are categorized in their entirety (levels 1, 2, 3).

+ References+ Details

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 14

-Subparagraph a

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 159

-Paragraph 18

-Subparagraph c(2), d, e, f

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

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Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 15

-Subparagraph b-d

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

-Section 50

-Paragraph 11

-URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13467-108611

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 159

-Paragraph 19

-Subparagraph a, b, c(1), d(1)

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 820

-SubTopic 10

-Section 50

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Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

-Section 45

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-URI http://asc.fasb.org/extlink&oid=6447952&loc=d3e13220-108610

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 157

-Paragraph 32

-Subparagraph a, c(1), c(2), c(3), d

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 107

-Paragraph 10

-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 11: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

-Section 50

-Paragraph 12

-URI http://asc.fasb.org/extlink&oid=7491637&loc=d3e13476-108611

Reference 12: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

-Topic 825

-SubTopic 10

-Section 50

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-Subparagraph (a)

-URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612

+ Details