Document and Entity Information (USD $) In Billions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2010	Feb. 09, 2011	Jun. 30, 2010
Document and Entity Information [Abstract]
Entity Registrant Name	AMR CORP
Entity Central Index Key	0000006201
Document Type	10-K
Document Period End Date	Dec. 31, 2010
Amendment Flag	false
Document Fiscal Year Focus	2010
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 2.3
Entity Common Stock, Shares Outstanding		333,435,431

Consolidated Statements of Operations (USD $) In Millions, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Revenues
Passenger - American Airlines	$ 16,760	$ 15,037	$ 18,234
- Regional Affiliates	2,327	2,012	2,486
Cargo	672	578	874
Other revenues	2,411	2,290	2,172
Total operating revenues	22,170	19,917	23,766
Expenses
Wages, salaries and benefits	6,847	6,807	6,655
Aircraft fuel	6,400	5,553	9,014
Other rentals and landing fees	1,418	1,353	1,298
Depreciation and amortization	1,093	1,104	1,207
Maintenance, materials and repairs	1,329	1,280	1,237
Commissions, booking fees and credit card expense	976	853	997
Aircraft rentals	580	505	492
Food service	490	487	518
Special charges	0	171	1,213
Other operating expenses	2,729	2,808	3,024
Total operating expenses	21,862	20,921	25,655
Operating Income (Loss)	308	(1,004)	(1,889)
Other Income (Expense)
Interest income	26	34	181
Interest expense	(823)	(744)	(803)
Interest capitalized	31	42	33
Miscellaneous - net	(48)	(80)	360
Other Income (Expense)	(814)	(748)	(229)
Income (Loss) Before Income Taxes	(506)	(1,752)	(2,118)
Income tax (benefit)	(35)	(284)	0
Net Earnings (Loss)	$ (471)	$ (1,468)	$ (2,118)
Earnings (Loss) Per Share
Basic	$ (1.41)	$ (4.99)	$ (8.16)
Diluted	$ (1.41)	$ (4.99)	$ (8.16)

Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009
Current Assets
Cash	$ 168	$ 153
Short-term investments	4,328	4,246
Restricted cash and short-term investments	450	460
Receivables, less allowance for uncollectible accounts (2010 - $58; 2009 - $58)	738	768
Inventories, less allowance for obsolescence (2010 - $530; 2009 - $509)	594	557
Fuel derivative contracts	269	135
Fuel Derivative collateral deposits	0	14
Other current assets	291	309
Total current assets	6,838	6,642
Equipment and Property
Flight equipment, at cost	20,345	19,647
Less accumulated depreciation	8,081	7,382
Flight equipment, net	12,264	12,265
Purchase deposits for flight equipment	375	639
Other equipment and property, at cost	5,173	5,158
Less accumulated depreciation	2,974	2,881
Other equipment and property, net	2,199	2,277
Equipment and Property, net	14,838	15,181
Equipment and Property Under Capital Leases
Flight equipment	605	651
Other equipment and property	219	215
Equipment and Property Under Capital Leases, gross	824	866
Less accumulated amortization	580	571
Equipment and Property Under Capital Leases, net	244	295
Other Assets
International slots and route authorities	708	736
Domestic slots and airport operating and gate lease rights, less accumulated amortization (2010 - $473; 2009 - $445)	224	252
Other assets	2,236	2,332
Other assets total	3,168	3,320
Total Assets	25,088	25,438
Current Liabilities
Accounts payable	1,156	1,064
Accrued salaries and wages	498	488
Fuel derivative liability	0	80
Accrued liabilities	1,587	1,551
Air traffic liability	3,656	3,431
Current maturities of long-term debt	1,776	1,024
Current obligations under capital leases	107	90
Total current liabilities	8,780	7,728
Long-Term Debt, Less Current Maturities	8,756	9,984
Obligations Under Capital Leases, Less Current Obligations	497	599
Other Liabilities and Credits
Deferred gains	270	272
Pension and postretirement benefits	7,877	7,397
Other liabilities and deferred credits	2,853	2,947
Other Liabilities and Credits Total	11,000	10,616
Commitments and Contingencies
Stockholders' Equity (Deficit)
Preferred stock - 20,000,000 shares authorized; None issued	0	0
Common stock - $1 par value; 750,000,000 shares authorized; shares issued: 2010 - 339,389,724; 2009 - 338,564,327	339	339
Additional paid-in capital	4,445	4,399
Treasury shares at cost: 2010 and 2009 - 5,940,399	(367)	(367)
Accumulated other comprehensive loss	(2,755)	(2,724)
Accumulated deficit	(5,607)	(5,136)
Stockholders' equity, total	(3,945)	(3,489)
Total Liabilities and Stockholders' Equity (Deficit)	$ 25,088	$ 25,438

Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Dec. 31, 2010	Dec. 31, 2009
Current Assets
Allowance for uncollectible accounts	$ 58	$ 58
Allowance for obsolescence	530	509
Other Assets
Accumulated amortization for domestic slots and airport operating and gate lease rights	$ 473	$ 445
Stockholders' Equity (Deficit)
Preferred stock, shares authorized	20,000,000	20,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 1	$ 1
Common stock, shares authorized	750,000,000	750,000,000
Common stock, shares issued	339,389,724	338,564,327
Treasury shares at cost	5,940,399	5,940,399

Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Cash Flow from Operating Activities:
Net earnings (loss)	$ (471)	$ (1,468)	$ (2,118)
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Depreciation	967	979	1,055
Amortization	126	125	152
Equity based stock compensation	43	61	53
Special charges	0	171	1,317
Pension and postretirement	236	657	279
Gain on sale of subsidiary	0	0	(432)
Redemption payments under operating leases for special facility revenue bonds	0	0	(188)
Change in assets and liabilities:
Decrease (increase) in receivables	29	43	217
Decrease (increase) in inventories	(81)	(79)	5
Decrease (increase) in derivative collateral and unwound derivative contracts	87	561	(940)
Increase (decrease) in accounts payable and accrued liabilities	(19)	(75)	(421)
Increase (decrease) in air traffic liability	225	(277)	(277)
Increase (decrease) in other liabilities and deferred credits	144	220	(101)
Other, net	(45)	12	5
Net cash provided by (used in) operating activities	1,241	930	(1,394)
Cash Flow from Investing Activities:
Capital expenditures, including purchase deposits on flight equipment	(1,962)	(1,521)	(876)
Net decrease (increase) in short-term investments	(82)	(1,330)	1,471
Net decrease (increase) in restricted cash and short-term investments	10	(1)	(31)
Proceeds from sale of equipment, property and investments/subsidiaries	4	76	480
Other	0	53	11
Net cash provided by (used in) investing activities	(2,030)	(2,723)	1,055
Cash Flow from Financing Activities:
Payments on long-term debt and capital lease obligations	(1,154)	(2,416)	(1,092)
Proceeds from:
Issuance of common stock, net of issuance costs	0	412	294
Reimbursement from construction reserve account	7	0	0
Exercise of stock options	1	1	1
Issuance of long-term debt	542	2,990	825
Sale leaseback transactions	1,408	768	354
Net cash provided by (used in) financing activities	804	1,755	382
Net increase (decrease) in cash	15	(38)	43
Cash at beginning of year	153	191	148
Cash at end of year	$ 168	$ 153	$ 191

Consolidated Statements of Stockholders' Equity (Deficit) (USD $) In Millions	Total	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated Other Comprehensive Income (loss)	Accumulated Deficit
Beginning Balance at Dec. 31, 2007	$ 2,704	$ 255	$ 3,696	$ (367)	$ 670	$ (1,550)
Net loss	(2,118)					(2,118)
Changes in pension, retiree medical and other liability	(2,724)				(2,724)
Net changes in fair value of derivative financial instruments	(1,116)				(1,116)
Unrealized gain (loss) on investments	(7)				(7)
Total comprehensive loss	(5,965)
Reclassification and amortization of stock compensation plans	30		30
Issuance of 52,269,849 and 27,057,554 shares on 2009 and 2008 respectively	294	27	267
Issuance of 825,397, 1,399,833 and 2,492,860 shares to employees pursuant to stock option and deferred stock incentive plans on 2010, 2009 and 2008 respectively	2	3	(1)
Ending Balance at Dec. 31, 2008	(2,935)	285	3,992	(367)	(3,177)	(3,668)
Net loss	(1,468)					(1,468)
Changes in pension, retiree medical and other liability	(117)				(117)
Net changes in fair value of derivative financial instruments	813				813
Non-cash tax provision	(248)				(248)
Unrealized gain (loss) on investments	5				5
Total comprehensive loss	(1,015)
Reclassification and amortization of stock compensation plans	48		48
Issuance of 52,269,849 and 27,057,554 shares on 2009 and 2008 respectively	412	52	360
Issuance of 825,397, 1,399,833 and 2,492,860 shares to employees pursuant to stock option and deferred stock incentive plans on 2010, 2009 and 2008 respectively	1	2	(1)
Ending Balance at Dec. 31, 2009	(3,489)	339	4,399	(367)	(2,724)	(5,136)
Net loss	(471)					(471)
Changes in pension, retiree medical and other liability	(247)				(247)
Net changes in fair value of derivative financial instruments	216				216
Total comprehensive loss	(502)
Reclassification and amortization of stock compensation plans	48		48
Issuance of 825,397, 1,399,833 and 2,492,860 shares to employees pursuant to stock option and deferred stock incentive plans on 2010, 2009 and 2008 respectively	(2)		(2)
Ending Balance at Dec. 31, 2010	$ (3,945)	$ 339	$ 4,445	$ (367)	$ (2,755)	$ (5,607)

Consolidated Statements of Stockholders' Equity (Deficit) (Parenthetical)	12 Months Ended
	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Consolidated Statements of Stockholders' Equity [Abstract]
Issuance of shares		52,269,849	27,057,554
Issuance of shares to employees pursuant to stock option and deferred stock incentive plans	825,397	1,399,833	2,492,860

Summary of Accounting Policies

12 Months Ended

Dec. 31, 2010

Summary of Accounting Policies [Abstract]

Summary of Accounting Policies

1. Summary of Accounting Policies

Basis of Presentation The accompanying consolidated financial statements as of December 31, 2010 and for the three years ended December 31, 2010 include the accounts of AMR Corporation (AMR or the Company) and its wholly owned subsidiaries, including (i) its principal subsidiary, American Airlines, Inc. (American) and (ii) its regional airline subsidiary, AMR Eagle Holding Corporation and its primary subsidiaries, American Eagle Airlines, Inc. and Executive Airlines, Inc. (collectively, AMR Eagle). The consolidated financial statements as of and for the years ended December 31, 2010, 2009 and 2008 include the accounts of the Company and its wholly owned subsidiaries as well as VIEs for which the Company is the primary beneficiary. All significant intercompany transactions have been eliminated.

New Accounting Pronouncements In November of 2009, the FASB issued new guidance that significantly changes the accounting for revenue in arrangements with multiple deliverables by requiring entities to separately account for individual deliverables in more of these arrangements. The guidance removes the criterion that entities must use vendor-specific objective and reliable evidence of fair value when separately accounting for deliverables, allowing for the recognition of revenue in a manner that more closely aligns with the economics of certain arrangements based on management’s estimate of the selling price. The standard must be applied prospectively to revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. In addition, the FASB significantly expanded the disclosures related to multiple deliverable revenue arrangements. Although the Company continues to evaluate the impact of the adoption of this standard on its consolidated financial statements, the Company believes the impact of adoption will not be material in 2011, but could have a significant impact on future results as new or materially modified revenue arrangements with certain partners are established in the normal course of business.

Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the accompanying consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Restricted Cash and Short-term Investments The Company has restricted cash and short-term investments related primarily to collateral held to support projected workers’ compensation obligations.

Inventories Spare parts, materials and supplies relating to flight equipment are carried at average acquisition cost and are expensed when used in operations. Allowances for obsolescence are provided — over the estimated useful life of the related aircraft and engines — for spare parts expected to be on hand at the date aircraft are retired from service. Allowances are also provided for spare parts currently identified as excess and obsolete. These allowances are based on management estimates, which are subject to change.

Maintenance and Repair Costs Maintenance and repair costs for owned and leased flight equipment are charged to operating expense as incurred, except costs incurred for maintenance and repair under flight hour maintenance contract agreements, which are accrued based on contractual terms when an obligation exists.

Intangible Assets Route acquisition costs and airport operating and gate lease rights represent the purchase price attributable to route authorities (including international airport take-off and landing slots), domestic airport take-off and landing slots and airport gate leasehold rights acquired. Indefinite-lived intangible assets (route acquisition costs and international slots and related international take-off and landing slots) are tested for impairment annually on December 31, rather than amortized, or when a triggering event occurs, in accordance with U.S. GAAP. Such triggering events may include significant changes to the Company’s network or capacity, or the implementation of open skies agreements in countries where the Company operates flights. Airport operating and gate lease rights are being amortized on a straight-line basis over 25 years to a zero residual value.

Statements of Cash Flows Short-term investments, without regard to remaining maturity at acquisition, are not considered as cash equivalents for purposes of the statements of cash flows.

Measurement of Asset Impairments The Company records impairment charges on long-lived assets used in operations when events and circumstances indicate that the assets may be impaired. An asset or group of assets is considered impaired when the undiscounted cash flows estimated to be generated by the asset are less than the carrying amount of the asset and the net book value of the asset exceeds its estimated fair value. In making these determinations, the Company uses certain assumptions, including, but not limited to: (i) estimated fair value of the asset; and (ii) estimated future cash flows expected to be generated by the asset, which are based on additional assumptions such as asset utilization, length of service the asset will be used in the Company’s operations and estimated salvage values.

Equipment and Property The provision for depreciation of operating equipment and property is computed on the straight-line method applied to each unit of property, except that major rotable parts, avionics and assemblies are depreciated on a group basis. The depreciable lives used for the principal depreciable asset classifications are:


		Depreciable Life

American jet aircraft and engines		20 — 30 years
Other regional aircraft and engines		16 — 20 years
Major rotable parts, avionics and assemblies		Life of equipment to which applicable
Improvements to leased flight equipment		Lesser of remaining lease term or expected useful life
Buildings and improvements (principally on leased land)		5 — 30 years or term of lease, including estimated renewal options when renewal is economically compelled at key airports
Furniture, fixtures and other equipment		3 — 10 years
Capitalized software		5 — 10 years

Residual values for aircraft, engines, major rotable parts, avionics and assemblies are generally five to ten percent, except when guaranteed by a third party for a different amount.

Equipment and property under capital leases are amortized over the term of the leases or, in the case of certain aircraft, over their expected useful lives. Lease terms vary but are generally six to 25 years for aircraft and seven to 40 years for other leased equipment and property.

Regional Affiliates Revenue from ticket sales is generally recognized when service is provided. Regional Affiliates revenues for flights connecting to American flights are based on industry standard proration agreements.

Passenger Revenue Passenger ticket sales are initially recorded as a component of Air traffic liability. Revenue derived from ticket sales is recognized at the time service is provided. However, due to various factors, including the complex pricing structure and interline agreements throughout the industry, certain amounts are recognized in revenue using estimates regarding both the timing of the revenue recognition and the amount of revenue to be recognized, including breakage. These estimates are generally based upon the evaluation of historical trends, including the use of regression analysis and other methods to model the outcome of future events based on the Company’s historical experience, and are recorded at the scheduled time of departure.

Various taxes and fees assessed on the sale of tickets to end customers are collected by the Company as an agent and remitted to taxing authorities. These taxes and fees have been presented on a net basis in the accompanying consolidated statement of operations and recorded as a liability until remitted to the appropriate taxing authority.

Frequent Flyer Program The estimated incremental cost of providing free travel awards is accrued for mileage credits earned by using American’s service that are expected to be redeemed in the future. American also accrues a frequent flyer liability for the mileage credits that are expected to be used for travel on participating airlines based on historical usage patterns and contractual rates. American sells mileage credits and related services to companies participating in its frequent flyer program. The portion of the revenue related to the sale of mileage credits, representing the revenue for air transportation sold, is valued at fair value and is deferred and amortized over 28 months, which approximates the expected period over which the mileage credits are used. Breakage of sold miles is recognized over the estimated period of usage. The remaining portion of the revenue, representing the marketing services sold and administrative costs associated with operating the AAdvantage program, is recognized upon sale as a component of Other revenues, as the related services have been provided. The Company’s total liability for future AAdvantage award redemptions for free, discounted or upgraded travel on American, American Eagle or participating airlines as well as unrecognized revenue from selling AAdvantage miles was approximately $1.4 billion (and is recorded as a component of Air traffic liability on the accompanying consolidated balance sheets) at December 31, 2010 and $1.5 billion as of December 31, 2009.

Income Taxes The Company generally believes that the positions taken on previously filed income tax returns are more likely than not to be sustained by the taxing authorities. The Company has recorded income tax and related interest liabilities where the Company believes its position may not be sustained or where the full income tax benefit will not be recognized. Thus, the effects of potential income tax benefits resulting from the Company’s unrecognized tax positions are not reflected in the tax balances of the financial statements. Recognized and unrecognized tax positions are reviewed and adjusted as events occur that affect the Company’s judgment about the recognizability of income tax benefits, such as lapsing of applicable statutes of limitations, conclusion of tax audits, release of administrative guidance, or rendering of a court decision affecting a particular tax position.

Advertising Costs The Company expenses on a straight-line basis the costs of advertising as incurred throughout the year. Advertising expense was $165 million for the year ended December 31, 2010, and $153 million for the years ended December 31, 2009 and December 31, 2008.

Subsequent Events In connection with preparation of the consolidated financial statements and in accordance U.S. GAAP, the Company evaluated subsequent events after the balance sheet date of December 31, 2010 and determined that no additional disclosure to that presented in this Form 10-K was necessary.

Special Charges and Restructuring Activities

12 Months Ended

Dec. 31, 2010

Special Charges and Restructuring Activities [Abstract]

Special Charges and Restructuring Activities


2.	Special Charges and Restructuring Activities

As a result of the revenue environment, high fuel prices and the Company’s restructuring activities, including its capacity reductions, the Company has recorded a number of charges during the last few years. In 2008 and 2009, the Company announced capacity reductions due to unprecedented high fuel costs at that time and the other challenges facing the industry. In connection with these capacity reductions, the Company incurred special charges related to aircraft, employee reductions and certain other charges.

Aircraft Charges

As part of these capacity reductions, the Company grounded its leased Airbus A300 aircraft prior to lease expiration. In 2009, the Company incurred approximately $94 million in net present value of future lease payments and lease return costs related to the grounding of the leased Airbus A300 fleet. The Company estimates that virtually all of these charges will result in future cash expenditures. Further, the Company also wrote down its owned Airbus A300 aircraft and related inventory to estimated salvage value in the fourth quarter of 2009, resulting in a non-cash expense of $20 million. All Airbus A300 aircraft were permanently retired as of 2009.

In the fourth quarter of 2009, due to the continuing severe downturn in the global economy and weakness in the regional jet aircraft market, the Company’s plan to sell certain of its Embraer RJ-135 aircraft was no longer feasible at the amount for which these aircraft had been valued. Consequently, the Company reclassified these aircraft from held for sale to held for use, tested them for impairment and concluded the carrying values of certain of its Embraer RJ-135 aircraft were no longer recoverable. Therefore, during the fourth quarter of 2009, the Company recorded an impairment charge of $42 million to write these aircraft down to their estimated fair values. In addition, these aircraft will now resume depreciation prospectively. In determining the fair values of these aircraft, the Company considered recent transactions for sales of similar aircraft and the value of the underlying engines. No portion of the impairment charge will result in future cash expenditures.

Employee Charges

In conjunction with the capacity reductions announced in 2008, the Company reduced its workforce commensurate with the announced system-wide capacity reductions. This reduction in workforce was accomplished through various measures, including voluntary programs, part-time work schedules, furloughs in accordance with collective bargaining agreements, and other reductions.

The following table summarizes the components of the Company’s special charges, the remaining accruals for these charges and the capacity reduction related charges (in millions) as of December 31, 2010:


	Aircraft			Facility Exit			Employee
	Charges			Costs			Charges			Other			Total

Remaining accrual at January 1, 2008	$	126		$	18		$	—		$	—		$	144
Capacity reduction charges		1,117			—			71			25			1,213
Non-cash charges		(1,103	)		—			—			(25	)		(1,128	)
Adjustments		1			(2	)		—			—			(1	)
Payments		(31	)		—			(55	)		—			(86	)

Remaining accrual at December 31, 2008	$	110		$	16		$	16		$	—		$	142
Capacity reduction charges		164			7			—			—			171
Non-cash charges		(68	)		—			—			—			(68	)
Adjustments		(2	)		—			—			—			(2	)
Payments		(49	)		(3	)		(16	)		—			(68	)

Remaining accrual at December 31, 2009	$	155		$	20		$	—		$	—		$	175
Non-cash charges
Adjustments		(8	)		11									3
Payments		(88	)		(4	)								(92	)

Remaining accrual at December 31, 2010	$	59		$	27		$	—		$	—		$	86

Cash outlays related to the accruals for aircraft charges and facility exit costs will occur through 2017 and 2018, respectively.

Other

On September 22, 2001, the Air Transportation Safety and System Stabilization Act (the Stabilization Act) was signed into law. The Stabilization Act provides that, notwithstanding any other provision of law, liability for all claims, whether compensatory or punitive, arising from the Terrorist Attacks, against any air carrier shall not exceed the liability coverage maintained by the air carrier. Based upon estimates provided by the Company’s insurance providers, the Company initially recorded a liability of approximately $2.3 billion for claims arising from the Terrorist Attacks, after considering the liability protections provided for by the Stabilization Act. The receivable and the liability, recorded in the accompanying consolidated balance sheet as Other assets and Other liabilities and deferred credits, respectively, was $1.6 billion and $1.7 billion at December 31, 2010 and 2009, respectively.

Investments and Fair Value Measurements

12 Months Ended

Dec. 31, 2010

Investments and Fair Value Measurements [Abstract]

Investments and Fair Value Measurements


3.	Investments and Fair Value Measurements

Short-term investments consisted of (in millions):


	December 31,
	2010		2009

Overnight investments, time deposits and Repurchase agreements	$	844	$	1,415
Corporate and bank notes		2,685		2,527
U. S. government agency mortgages		605		—
U.S. government agency notes		—		300
Commingled funds		190		—
Other		4		4

	$	4,328	$	4,246

Short-term investments at December 31, 2010, by contractual maturity included (in millions):


Due in one year or less	$	2,609
Due between one year and three years		1,114
Due after three years		605

	$	4,328

All short-term investments are classified as available-for-sale and stated at fair value. Unrealized gains and losses are reflected as a component of Accumulated other comprehensive income (loss).

The Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The Company’s short-term investments classified as Level 2 primarily utilize broker quotes in a non-active market for valuation of these securities. The Company’s fuel derivative contracts, which consist of commodity collars and calls, are valued using energy and commodity market data which is derived by combining raw inputs with quantitative models and processes to generate forward curves and volatilities. No changes in valuation techniques or inputs occurred during the year ended December 31, 2010.

Assets and liabilities measured at fair value on a recurring basis are summarized below:


	Fair Value Measurements at December 31, 2010
			Quoted Prices in				Significant
			Active Markets for		Significant		Unobservable
			Identical Assets		Observable Inputs		Inputs
Description	Total		(Level 1)		(Level 2)		(Level 3)
	(In millions)

Short-term investments(1,2)
Money market funds	$	198	$	198	$	—	$	—
Government agency investments		605		—		605		—
Repurchase investments		831		—		831		—
Short-term obligations		1,580		—		1,580		—
Corporate obligations		647		—		647		—
Bank notes/Certificates of deposit/Time deposits		467		—		467		—

		4,328		198		4,130		—
Restricted cash and short-term investments(1)
Money market funds		450		450		—		—
Fuel derivative contracts(1)		269		—		269		—

Total	$	5,047	$	648	$	4,399	$	—


(1)		Unrealized gains or losses on short-term investments, restricted cash and short-term investments and derivatives qualifying for hedge accounting are recorded in Accumulated other comprehensive income (loss) (OCI) at each measurement date.

(2)		The majority of the Company’s short-term investments mature in one year or less except for $467 million of Bank notes/Certificates of deposit/Time deposits, $605 million of U.S. Government agency investments and $647 million of Corporate obligations which have maturity dates exceeding one year.

No significant transfers between Level 1 and Level 2 occurred during the year ended December 31, 2010. The Company’s policy regarding the recording of transfers between levels is to record any such transfers at the end of the reporting period.

Commitments, Contingencies and Guarantees

12 Months Ended

Dec. 31, 2010

Commitments Contingencies and Guarantees Abstract

Commitments, Contingencies and Guarantees


4.	Commitments, Contingencies and Guarantees

As of December 31, 2010, American had 15 Boeing 737-800 aircraft purchase commitments in 2011 and 28 Boeing 737-800 aircraft purchase commitments in 2012 and, in addition to those commitments, American had firm purchase commitments for eleven Boeing 737-800 aircraft and seven Boeing 777 aircraft scheduled to be delivered in 2013 through 2016. American also previously announced plans (subject to certain reconfirmation rights) to acquire 42 Boeing 787-9 aircraft, with the right to acquire an additional 58 Boeing 787-9 aircraft. American has selected GE Aviation as the exclusive provider of engines for its expected order of Boeing 787-9 aircraft. As of December 31, 2010, AMR Eagle had firm purchase commitments for 8 Bombardier CRJ-700 aircraft scheduled to be delivered in 2011.

As of December 31, 2010, payments for the above purchase commitments will approximate $884 million in 2011, $951 million in 2012, $491 million in 2013, $291 million in 2014, $169 million in 2015 and $79 million for 2016. These amounts are net of purchase deposits currently held by the manufacturers. American has granted Boeing a security interest in American’s purchase deposits with Boeing. The Company’s purchase deposits totaled $375 million and $639 million at December 31, 2010 and 2009, respectively.

On January 14, 2011, the Company entered into an amendment to Purchase Agreement No. 1980 with the Boeing Company to exercise rights to acquire two Boeing 777-300ER aircraft for delivery in 2012. The Company’s total purchase commitments are expected to be approximately $2.8 billion at the end of the first quarter 2011, reflecting this transaction and aircraft purchase deposits paid during that period.

On December 18, 2007, the European Commission issued a Statement of Objection (SO) against 26 airlines, including the Company. The SO alleges that these carriers participated in a conspiracy to set surcharges on cargo shipments in violation of European Union (EU) law. During 2010 the EU notified the Company it was dismissing its investigation against the Company.

On August 26, 2010, the Federal Aviation Administration (FAA) proposed a $24.2 million civil penalty against American, claiming that American failed to properly perform certain portions of an FAA Airworthiness Directive concerning certain wiring to the McDonnell Douglas MD-80 aircraft auxiliary hydraulic pump. American plans to challenge the proposed civil penalty. The Company has concluded that the amount of the penalty, if any, that may be paid is not estimable at December 31, 2010.

The Company has contracts related to facility construction or improvement projects, primarily at airport locations. The contractual obligations related to these projects totaled approximately $73 million as of December 31, 2010. The Company expects to make payments of $60 million and $5 million in 2011 and 2012, respectively. In addition, the Company has an information technology support related contract that requires minimum annual payments of $100 million in 2011 and declining to $70 million in 2014 through 2019.

American has a capacity purchase agreement with Chautauqua Airlines, Inc. to provide Embraer -140 regional jet services to certain markets under the brand AmericanConnection^®. Under these arrangements, the Company pays the AmericanConnection^® carrier a fee per block hour to operate the aircraft. The block hour fees are designed to cover the AmericanConnection^® carrier’s fully allocated costs plus a margin. Assumptions for certain costs such as fuel, landing fees, insurance, and aircraft ownership are trued up to actual values on a pass through basis. In consideration for these payments, the Company retains all passenger and other revenues resulting from the operation of the AmericanConnection^® regional jets. Minimum payments under the contracts are $56 million in 2011 and $15 million in 2012. In addition, if the Company terminates the Chautauqua contract without cause, Chautauqua has the right to put its 15 Embraer aircraft to the Company. If this were to happen, the Company would take possession of the aircraft and become liable for lease obligations totaling approximately $21 million per year with lease expirations in 2018 and 2019.

The Company is a party to many routine contracts in which it provides general indemnities in the normal course of business to third parties for various risks. The Company is not able to estimate the potential amount of any liability resulting from the indemnities. These indemnities are discussed in the following paragraphs.

In its aircraft financing agreements, the Company generally indemnifies the financing parties, trustees acting on their behalf and other relevant parties against liabilities (including certain taxes) resulting from the financing, manufacture, design, ownership, operation and maintenance of the aircraft regardless of whether these liabilities (or taxes) relate to the negligence of the indemnified parties.

The Company’s loan agreements and other London Interbank Offered Rate (LIBOR)-based financing transactions (including certain leveraged aircraft leases) generally obligate the Company to reimburse the applicable lender for incremental costs due to a change in law that imposes (i) any reserve or special deposit requirement against assets of, deposits with or credit extended by such lender related to the loan, (ii) any tax, duty or other charge with respect to the loan (except standard income tax) or (iii) capital adequacy requirements. In addition, the Company’s loan agreements, derivative contracts and other financing arrangements typically contain a withholding tax provision that requires the Company to pay additional amounts to the applicable lender or other financing party, generally if withholding taxes are imposed on such lender or other financing party as a result of a change in the applicable tax law.

These increased cost and withholding tax provisions continue for the entire term of the applicable transaction, and there is no limitation on the maximum additional amounts the Company could be obligated to pay under such provisions. Any failure to pay amounts due under such provisions generally would trigger an event of default and, in a secured financing transaction, would entitle the lender to foreclose on the collateral to realize the amount due.

In certain transactions, including certain aircraft financing leases and loans and derivative transactions, the lessors, lenders and/or other parties have rights to terminate the transaction based on changes in foreign tax law, illegality or certain other events or circumstances. In such a case, the Company may be required to make a lump sum payment to terminate the relevant transaction.

The Company has general indemnity clauses in many of its airport and other real estate leases where the Company as lessee indemnifies the lessor (and related parties) against liabilities related to the Company’s use of the leased property. Generally, these indemnifications cover liabilities resulting from the negligence of the indemnified parties, but not liabilities resulting from the gross negligence or willful misconduct of the indemnified parties. In addition, the Company provides environmental indemnities in many of these leases for contamination related to the Company’s use of the leased property.

Under certain contracts with third parties, the Company indemnifies the third party against legal liability arising out of an action by the third party, or certain other parties. The terms of these contracts vary and the potential exposure under these indemnities cannot be determined. The Company has liability insurance protecting the Company for some of the obligations it has undertaken under these indemnities.

AMR and American have event risk covenants in approximately $1 billion of indebtedness and operating leases as of December 31, 2010. These covenants permit the holders of such obligations to receive a higher rate of return (between 100 and 600 basis points above the state rate) if a designated event, as defined, should occur and the credit ratings of such obligations are downgraded below certain levels within a certain period of time. No designated event, as defined, had occurred as of December 31, 2010.

The Company is involved in certain claims and litigation related to its operations. The Company is also subject to regulatory assessments in the ordinary course of business. AMR establishes reserves for litigation and regulatory matters when those matters present loss contingencies that are both probable and can be reasonably estimated. In the opinion of management, liabilities, if any, arising from these claims and litigation will not have a material adverse effect on the Company’s consolidated financial position, results of operations, or cash flows, after consideration of available insurance.

Leases

12 Months Ended

Dec. 31, 2010

Leases [Abstract]

Leases


5.	Leases

AMR’s subsidiaries lease various types of equipment and property, primarily aircraft and airport facilities. The future minimum lease payments required under capital leases, together with the present value of such payments, and future minimum lease payments required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2010, were (in millions):


	Capital		Operating
Year Ending December 31,	Leases		Leases

2011	$	186	$	1,254
2012		136		1,068
2013		120		973
2014		98		831
2015		87		672
2016 and thereafter		349		6,006

	$	976	$	10,804	(1)

Less amount representing interest		372

Present value of net minimum lease payments	$	604


(1)		As of December 31, 2010, included in Accrued liabilities and Other liabilities and deferred credits on the accompanying consolidated balance sheet is approximately $1.1 billion relating to rent expense being recorded in advance of future operating lease payments.

At December 31, 2010, the Company was operating 202 jet aircraft and 39 turboprop aircraft under operating leases and 70 jet aircraft under capital leases. The aircraft leases can generally be renewed at rates based on fair market value at the end of the lease term for one to five years. Some aircraft leases have purchase options at or near the end of the lease term at fair market value, but generally not to exceed a stated percentage of the defined lessor’s cost of the aircraft or a predetermined fixed amount.

During 2010, the Company financed 36 deliveries of Boeing 737-800 aircraft through sale leaseback transactions resulting in gains which are being amortized over the respective remaining lease terms. During 2009 non-recurring charges related to losses on certain sale leasebacks of vintage aircraft of $88 million were realized and included in Other operating income.

Special facility revenue bonds have been issued by certain municipalities primarily to improve airport facilities and purchase equipment. To the extent these transactions were committed to prior to May 21, 1998, they are accounted for as operating leases under U.S. GAAP. Approximately $1.5 billion of these bonds (with total future payments of approximately $3.2 billion as of December 31, 2010) are guaranteed by American, AMR, or both. Approximately $177 million of these special facility revenue bonds contain mandatory tender provisions that require American to make operating lease payments sufficient to repurchase the bonds at various times: $112 million in 2014 and $65 million in 2015. Although American has the right to remarket the bonds, there can be no assurance that these bonds will be successfully remarketed. Any payments to redeem or purchase bonds that are not remarketed would generally reduce existing rent leveling accruals or be considered prepaid facility rentals and would reduce future operating lease commitments. The special facility revenue bonds that contain mandatory tender provisions are listed in the table above at their ultimate maturity date rather than their mandatory tender provision date.

Rent expense, excluding landing fees, was $1.5 billion, $1.3 billion and $1.3 billion in 2010, 2009 and 2008, respectively.

American has determined that it holds a significant variable interest in, but is not the primary beneficiary of, certain trusts that are the lessors under 83 of its aircraft operating leases. These leases contain a fixed price purchase option, which allows American to purchase the aircraft at a predetermined price on a specified date. However, American does not guarantee the residual value of the aircraft. As of December 31, 2010, future lease payments required under these leases totaled $1.1 billion.

Indebtedness

12 Months Ended

Dec. 31, 2010

Indebtedness [Abstract]

Indebtedness


6.	Indebtedness

Long-term debt consisted of (in millions):


	December 31,
	2010		2009

Secured variable and fixed rate indebtedness due through 2021 (effective rates from 1.00% — 13.00% at December 31, 2010)	$	5,114	$	5,553
Enhanced equipment trust certificates due through 2019 (rates from 5.10% — 12.00% at December 31, 2010)		2,002		2,022
6.00% — 8.50% special facility revenue bonds due through 2036		1,641		1,658
AAdvantage Miles advance purchase (net of discount of $110 million) (effective rate 8.30)%		890		890
6.25% senior convertible notes due 2014		460		460
9.00% — 10.20% debentures due through 2021		214		214
7.88% — 10.55% notes due through 2039		211		211
		10,532		11,008
Less current maturities		1,776		1,024

Long-term debt, less current maturities	$	8,756	$	9,984

Payments of long-term debt (including sinking fund requirements) for the next five years are: 2011 — $2.4 billion; 2012 — $1.7 billion; 2013 — $990 million; 2014 — $1.4 billion, 2015 — $713 million. The 2011 amount includes approximately $600 million that was refinanced in January 2011 as described below and thus is excluded from current maturities.

As of December 31, 2010, AMR had issued guarantees covering approximately $1.6 billion of American’s tax-exempt bond debt (and interest thereon) and $459 million of American’s secured debt (and interest thereon). American had issued guarantees covering approximately $885 million of AMR’s unsecured debt (and interest thereon). In addition, as of December 31, 2010, AMR and American had issued guarantees covering approximately $216 million of AMR Eagle’s secured debt (and interest thereon) and AMR has issued additional guarantees covering $2.1 billion of AMR Eagle’s secured debt (and interest thereon). AMR also guarantees $145 million of American’s leases of certain Super ATR aircraft, which are subleased to AMR Eagle.

On January 25, 2011, American closed on a $657 million Pass Through Trust Certificates (the Certificates). The equipment notes expected to be held by each pass through trust will be issued for each of (a) 15 Boeing 737-823 aircraft delivered new to American from 1999 to 2001, (b) six Boeing 757-223 aircraft delivered new to American in 1999 and 2001, (c) two Boeing 767-323ER aircraft delivered new to American in 1999 and (d) seven Boeing 777-223ER aircraft delivered new to American from 1999 to 2000. At closing, 27 of the aircraft were encumbered by either private mortgages or by liens to secure debt incurred in connection with the issuance of enhanced equipment trust certificates in 2001, all of which mature in 2011. As a result, the proceeds from the sale of the Certificates of each trust will initially be held in escrow with a depositary, pending the financing of each aircraft under an indenture relating to the Certificates. Interest of 5.25% and 7.00% per annum on the issued and outstanding Series A equipment notes and Series B equipment notes, respectively, will be payable semiannually on January 31 and July 31 of each year, commencing on July 31, 2011, and principal on such equipment notes is scheduled for payment on January 31 and July 31 of certain years, commencing on July 31, 2011. The payment obligations of American under the equipment notes will be fully and unconditionally guaranteed by AMR Corporation.

In 2009, American entered into an arrangement under which Citibank paid to American $1.0 billion in order to pre-purchase AAdvantage Miles (the Advance Purchase Miles) under American’s AAdvantage frequent flier loyalty program (the Advance Purchase). Approximately $890 million of the Advance Purchase proceeds is accounted for as a loan from Citibank with the remaining $110 million recorded as Deferred Revenue in Other liabilities and deferred credits.

To effect the Advance Purchase, American and Citibank entered into an Amended and Restated AAdvantage Participation (as so amended and restated, the Amended Participation Agreement). Under the Amended Participation Agreement, American agreed that it would apply in equal monthly installments, over a five year period beginning on January 1, 2012, the Advance Purchase Miles to Citibank cardholders’ AAdvantage accounts.

Pursuant to the Advance Purchase, Citibank has been granted a first-priority lien in certain of American’s AAdvantage program assets, and a lien in certain of American’s Heathrow and Narita routes and slots that would be subordinated to any subsequent first lien. Commencing on December 31, 2011, American has the right to repurchase, without premium or penalty, any or all of the Advance Purchase Miles that have not then been posted to Citibank cardholders’ accounts. American is also obligated, in certain circumstances (including certain specified termination events under the Amended Participation Agreement, certain cross defaults and cross acceleration events, and if any Advance Purchase Miles remain at the end of the term) to repurchase for cash all of the Advance Purchase Miles that have not then been used by Citibank.

The Amended Participation Agreement includes provisions that grant Citibank the right to use Advance Purchase Miles on an accelerated basis under specified circumstances. American also has the right under certain circumstances to release, or substitute other comparable collateral for, the Heathrow and Narita route and slot related collateral.

During 2009, American closed a $520 million Pass Through Trust Certificates (the Certificates) financing covering four Boeing 777-200ER aircraft owned by American and 16 of American’s Boeing 737-800 deliveries. Equipment notes underlying the Certificates bear interest at 10.375 percent per annum and principal and interest on the notes are payable in semi-annual installments with a balloon payment at maturity in 2019. Approximately $200 million of the proceeds from the sale of the Certificates were used by American during 2010 for the delivery and financing of Boeing 737-800 aircraft.

Also in 2009, American entered into a sale leaseback financing transaction with GECAS for Boeing 737-800 aircraft (the 2009 Sale Leaseback) delivered in 2010 and certain Boeing 737-800 aircraft deliveries scheduled to be delivered in 2011 for an aggregate commitment of $1.6 billion. The 2009 sale leaseback is subject to certain terms and conditions, including a condition to the effect that, at the time of entering into the sale and leaseback of a particular Boeing 737-800 aircraft, American has at least a certain amount of unrestricted cash and short term investments.

At December 31, 2010, the Company had outstanding $460 million principal amount of its 6.25 percent senior convertible notes due 2014. Each note is convertible by holders into shares of AMR common stock at an initial conversion rate of 101.0101 shares per $1,000 principal amount of notes (which represents an equivalent initial conversion price of approximately $9.90 per share), subject to adjustment upon the occurrence of certain events, at any time prior to the close of business on the business day immediately preceding the maturity date of the notes. The Company must pay the conversion price of the notes in common stock. If the holders of the notes do not convert prior to maturity, the Company will retire the debt in cash. These notes are guaranteed by American.

Certain of the Company’s debt financing agreements contain loan to value ratio covenants and require the Company to periodically appraise the collateral. Pursuant to such agreements, if the loan to value ratio exceeds a specified threshold, we may be required to subject additional qualifying collateral (which in some cases may include cash collateral) or, in the alternative, to pay down such financing, in whole or in part, with premium (if any).

Almost all of the Company’s aircraft assets (including aircraft eligible for the benefits of Section 1110 of the U.S. Bankruptcy Code) are encumbered.

Cash payments for interest, net of capitalized interest, were $735 million, $631 million and $685 million for 2010, 2009 and 2008, respectively.

Financial Instruments and Risk Management

12 Months Ended

Dec. 31, 2010

Financial Instruments and Risk Management [Abstract]

Financial Instruments and Risk Management


7.	Financial Instruments and Risk Management

Fuel Price Risk Management As part of the Company’s risk management program, it uses a variety of financial instruments, primarily heating oil option and collar contracts, as cash flow hedges to mitigate commodity price risk. The Company does not hold or issue derivative financial instruments for trading purposes. As of December 31, 2010, the Company had fuel derivative contracts outstanding covering 31 million barrels of jet fuel that will be settled over the next 24 months. A deterioration of the Company’s liquidity position may negatively affect the Company’s ability to hedge fuel in the future.

In accordance with U.S. GAAP, the Company assesses, both at the inception of each hedge and on an ongoing basis, whether the derivatives that are used in its hedging transactions are highly effective in offsetting changes in cash flows of the hedged items. Derivatives that meet the requirements are granted special hedge accounting treatment, and the Company’s hedges generally meet these requirements. Accordingly, the Company’s fuel derivative contracts are accounted for as cash flow hedges, and the fair value of the Company’s hedging contracts is recorded in Current Assets or Current Liabilities in the accompanying consolidated balance sheets until the underlying jet fuel is purchased. The Company determines the ineffective portion of its fuel hedge contracts by comparing the cumulative change in the total value of the fuel hedge contract, or group of fuel hedge contracts, to the cumulative change in a hypothetical jet fuel hedge. If the total cumulative change in value of the fuel hedge contract more than offsets the total cumulative change in a hypothetical jet fuel hedge, the difference is considered ineffective and is immediately recognized as a component of Aircraft fuel expense. Effective gains or losses on fuel hedging contracts are deferred in Accumulated other comprehensive income (loss) and are recognized in earnings as a component of Aircraft fuel expense when the underlying jet fuel being hedged is used.

Ineffectiveness is inherent in hedging jet fuel with derivative positions based in crude oil or other crude oil related commodities. In assessing effectiveness, the Company uses a regression model to determine the correlation of the change in prices of the commodities used to hedge jet fuel (e.g., NYMEX Heating oil) to the change in the price of jet fuel. The Company also monitors the actual dollar offset of the hedges’ market values as compared to hypothetical jet fuel hedges. The fuel hedge contracts are generally deemed to be “highly effective” if the R-squared is greater than 80 percent and dollar offset correlation is within 80 percent to 125 percent. The Company discontinues hedge accounting prospectively if it determines that a derivative is no longer expected to be highly effective as a hedge or if it decides to discontinue the hedging relationship. Subsequently, any changes in the fair value of these derivatives are marked to market through earnings in the period of change.

For the years ended December 31, 2010, 2009 and 2008, the Company recognized net gains (losses) of approximately ($142) million, ($651) million and $380 million, respectively, as a component of Aircraft fuel expense on the accompanying consolidated statements of operations related to its fuel hedging agreements, including the ineffective portion of the hedges. The fair value of the Company’s fuel hedging agreements at December 31, 2010 and 2009, representing the amount the Company would receive upon termination of the agreements, totaled $257 million and $57 million, respectively, which excludes a payable for both years related to contracts that settled in December of each year. As of December 31, 2010, the Company estimates that during the next twelve months it will reclassify from Accumulated other comprehensive loss into earnings approximately $121 million in net gains (based on prices as of December 31, 2010) related to its fuel derivative hedges.

The impact of cash flow hedges on the Company’s consolidated financial statements for the years ending December 31, 2010 and 2009, respectively, is depicted below (in millions):

Fair Value of Aircraft Fuel Derivative Instruments (all cash flow hedges)

Asset Derivatives as of December 31,

Liability Derivatives as of December 31,

2010

2009

2010

2009

Balance

Sheet

Fair

Sheet

Fair

Sheet

Fair

Sheet

Fair

Location

Value

Location

Value

Location

Value

Location

Value

Fuel derivative
contracts

$269

Fuel derivative
contracts

$126

Fuel derivative
liability

$—

Fuel derivative
liability

$71

Effect of Aircraft Fuel Derivative Instruments on Statements of Operations (all cash flow hedges)

Amount of Gain

(Loss)

Location of Gain

Reclassified

Location of Gain

Amount of Gain (Loss)

Recognized in

(Loss) Reclassified from

from Accumulated

(Loss) Recognized

Recognized in Income on

OCI on Derivative(1)

Accumulated OCI

OCI into Income(1)

in Income on

Derivative(2)

2010

2009

into Income(1)

2010

2009

Derivative(2)

2010

2009

$72

$151

Aircraft Fuel

$(144)

$(662)

Aircraft Fuel

$11


(1)		Effective portion of gain (loss)

(2)		Ineffective portion of gain (loss)

The Company is also exposed to credit losses in the event of non-performance by counterparties to these financial instruments, and although no assurances can be given, the Company does not expect any of the counterparties to fail to meet its obligations. The credit exposure related to these financial instruments is represented by the fair value of contracts with a positive fair value at the reporting date, reduced by the effects of master netting agreements. To manage credit risks, the Company selects counterparties based on credit ratings, limits its exposure to a single counterparty under defined guidelines, and monitors the market position of the program and its relative market position with each counterparty. The Company also maintains industry-standard security agreements with a number of its counterparties which may require the Company or the counterparty to post collateral if the value of selected instruments exceed specified mark-to-market thresholds or upon certain changes in credit ratings.

As of December 31, 2010, the Company had received collateral of $73 million which is included in short-term investments.

In addition to the Company’s qualifying cash flow hedges, American has hedges that were effectively unwound in 2009 that were recorded as assets and liabilities on the balance sheet. Fair value of these offsetting positions not designated as hedges as of December 31, 2009 was a $9 million asset recorded in Fuel derivative contracts and a $9 million liability recorded in Fuel derivative liability. In January 2010, all of these contracts were settled with a net zero impact to the Company’s financial statements.

Fair Values of Financial Instruments The fair values of the Company’s long-term debt were estimated using quoted market prices where available. For long-term debt not actively traded, fair values were estimated using discounted cash flow analyses, based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements.

The carrying value and estimated fair values of the Company’s long-term debt, including current maturities, were (in millions):


	December 31,
	2010				2009
	Carrying		Fair		Carrying		Fair
	Value		Value		Value		Value

Secured variable and fixed rate indebtedness	$	5,114	$	4,562	$	5,553	$	4,310
Enhanced equipment trust certificates		2,002		2,127		2,022		1,999
6.00% — 8.50% special facility revenue bonds		1,641		1,657		1,658		1,600
AAdvantage Miles advance purchase		890		903		890		893
4.50% — 6.25% senior convertible notes		460		526		460		476
9.00% — 10.20% debentures		214		207		214		158
7.88% — 10.55% notes		211		209		211		181

	$	10,532	$	10,191	$	11,008	$	9,617

Income Taxes

12 Months Ended

Dec. 31, 2010

Income Taxes [Abstract]

Income Taxes


8.	Income Taxes

The Company has an unrecognized tax benefit of approximately $6 million, which did not change during the twelve months ended December 31, 2010. Changes in the unrecognized tax benefit have no impact on the effective tax rate due to the existence of the valuation allowance. Accrued interest on tax positions is recorded as a component of interest expense but was not significant at December 31, 2010.

The reconciliation of the beginning and ending amounts of unrecognized tax benefit are (in millions):


	2010		2009

Unrecognized Tax Benefit at January 1	$	6	$	24
Decreases due to settlements with taxing authority		0		(18	)

Unrecognized Tax Benefit at December 31	$	6	$	6

The Company estimates that the unrecognized tax benefit will not significantly change within the next twelve months.

The Company files its tax returns as prescribed by the tax laws of the jurisdictions in which it operates. The Company’s 2004 through 2009 tax years are still subject to examination by the Internal Revenue Service. Various state and foreign jurisdiction tax years remain open to examination and the Company is under examination, in administrative appeals, or engaged in tax litigation in certain jurisdictions. The Company believes that the effect of any additional assessment(s) will be immaterial to its consolidated financial statements.

The significant components of the income tax provision (benefit) were (in millions);


	Year Ended December 31,
	2010			2009			2008

Current	$	(5	)	$	(36	)	$	0
Deferred		(30	)		(248	)		0

Income tax benefit	$	(35	)	$	(284	)	$	—

The income tax expense (benefit) differed from amounts computed at the statutory federal income tax rate as follows (in millions):


	Year Ended December 31,
	2010			2009			2008

Statutory income tax provision expense/(benefit)	$	(177	)	$	(613	)	$	(741	)
State income tax expense/(benefit), net of federal tax effect		(1	)		(41	)		(49	)
Meal expense		7			7			8
Change in valuation allowance		121			597			807
Tax benefit resulting from OCI allocation					(248	)		—
Other, net		15			14			(25	)

Income tax benefit	$	(35	)	$	(284	)	$	—

The change in the valuation allowance reflects the recording by the Company in 2010 and 2009 of an income tax expense credit of approximately $30 million and $36 million, respectively, resulting from the Company’s elections under applicable sections of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 and the Housing and Economic Recovery Act of 2008 (as extended by the American Recovery and Reinvestment Act of 2009), allowing corporations to accelerate utilization of certain research and alternative minimum tax (AMT) credit carryforwards in lieu of applicable bonus depreciation on certain qualifying capital investments.

In addition to the changes in the valuation allowance from operations described in the table above, the valuation allowance was also impacted by the changes in the components of Accumulated other comprehensive income (loss), described in Note 12 to the consolidated financial statements. The total increase in the valuation allowance was $121 million, $135 million, and $2.1 billion in 2010, 2009, and 2008, respectively.

The Company recorded a $248 million non-cash income tax benefit from continuing operations during the fourth quarter of 2009. Under current accounting rules, the Company is required to consider all items (including items recorded in other comprehensive income) in determining the amount of tax benefit that results from a loss from continuing operations and that should be allocated to continuing operations. As a result, the Company recorded a tax benefit on the loss from continuing operations for the year, which will be exactly offset by income tax expense on other comprehensive income. However, while the income tax benefit from continuing operations is reported on the income statement, the income tax expense on other comprehensive income is recorded directly to Accumulated other comprehensive income, which is a component of stockholders’ equity. Because the income tax expense on other comprehensive income is equal to the income tax benefit from continuing operations, the Company’s year-end net deferred tax position is not impacted by this tax allocation.

The Company provides a valuation allowance for deferred tax assets when it is more likely than not that some portion, or all of its deferred tax assets, will not be realized. In assessing the realizability of the deferred tax assets, management considers whether it is more likely than not that some portion, or all of the deferred tax assets, will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income (including reversals of deferred tax liabilities) during the periods in which those temporary differences will become deductible.

The components of AMR’s deferred tax assets and liabilities were (in millions):


	December 31,
	2010			2009

Deferred tax assets:
Postretirement benefits other than pensions	$	1,056		$	971
Rent expense		333			331
Alternative minimum tax credit carryforwards		392			397
Operating loss carryforwards		2,271			2,276
Pensions		1,865			1,686
Frequent flyer obligation		630			669
Gains from lease transactions		55			90
Other		583			787

Total deferred tax assets		7,185			7,207
Valuation allowance		(2,990	)		(2,869	)

Net deferred tax assets		4,195			4,338

Deferred tax liabilities:
Accelerated depreciation and amortization		(3,985	)		(4,152	)
Other		(185	)		(186	)

Total deferred tax liabilities		(4,170	)		(4,338	)

Net deferred tax asset	$	25		$	—

At December 31, 2010, the Company had available for federal income tax purposes an alternative minimum tax credit carryforward of approximately $392 million, which is available for an indefinite period, and federal net operating losses of approximately $6.7 billion for regular tax purposes, which will expire, if unused, beginning in 2022. These net operating losses include an unrealized benefit of approximately $666 million related to the implementation of share-based compensation accounting guidance that will be recorded in equity when realized. The Company had available for state income tax purposes net operating losses of $3.7 billion, which expire, if unused, in years 2011 through 2027. The amount that will expire in 2011 is $25 million.

Cash payments (refunds) for income taxes were ($32) million, $6 million and $(14) million for 2010, 2009 and 2008, respectively.

Under special tax rules (the Section 382 Limitation), cumulative stock ownership changes among material shareholders exceeding 50 percent during a 3-year period can potentially limit a company’s future use of net operating losses and tax credits (NOLs). The Section 382 Limitation may be increased by certain “built-in gains,” as provided by current IRS guidance. Based on available information, the Company believes it is not currently subject to the Section 382 Limitation. If triggered under current conditions, the Section 382 Limitation is not expected to significantly impact the recorded value of deferred taxes or timing of utilization of the Company’s NOLs.

Share Based Compensation

12 Months Ended

Dec. 31, 2010

Share Based Compensation [Abstract]

Share Based Compensation


9.	Share Based Compensation

AMR grants, or has granted, stock compensation under three plans: the 1998 Long Term Incentive Plan (the 1998 Plan), the 2003 Employee Stock Incentive Plan (the 2003 Plan) and the 2009 Long Term Incentive Plan (the 2009 Plan). Collectively, the 1998 Plan and the 2009 Plan are referred to as the LTIP Plans.

Under the LTIP Plans, officers and key employees of AMR and its subsidiaries may be granted certain types of stock or performance based awards. At December 31, 2010, the Company had stock option awards, stock appreciation right (SAR) awards, performance share awards, deferred share awards and other awards outstanding under these plans. The total number of common shares authorized for distribution under the 1998 Plan and the 2009 Plan is 23,700,000 and 4,000,000 shares, respectively. The 1998 Plan expired by its terms in 2008.

The Company established the 2003 Plan to provide equity awards to employees. Under the 2003 Plan, employees may be granted stock options, restricted stock and deferred stock. At December 31, 2010, the Company had stock options and deferred awards outstanding under this plan. The total number of shares authorized for distribution under the 2003 Plan is 42,680,000 shares.

In 2010, 2009 and 2008 the total charge for share-based compensation expense included in Wages, salaries and benefits expense was $53 million, $61 million and $53 million, respectively. In 2010, 2009 and 2008, the amount of cash used to settle equity instruments granted under share-based compensation plans was $2 million, $1 million and $24 million, respectively.

Stock Options/SARs During 2006, the AMR Board of Directors approved an amendment covering all of the outstanding stock options previously granted under the 1998 Plan. The amendment added to each of the outstanding options an additional SAR in tandem with each of the then outstanding stock options. The addition of the SAR did not impact the fair value of the stock options, but simply allowed the Company to settle the exercise of the option by issuing the net number of shares equal to the in-the-money value of the option. This amendment is estimated to make available enough shares to permit the Company to settle all outstanding performance and deferred share awards under the 1998 Plan in stock rather than cash.

Options/SARs granted under the LTIP Plans and the 2003 Plan are awarded with an exercise price equal to the fair market value of the stock on date of grant, become exercisable in equal annual installments over periods ranging from three to five years and expire no later than ten years from the date of grant. Expense for the options is recognized on a straight-line basis. The fair value of each award is estimated on the date of grant using the modified Black-Scholes option valuation model and the assumptions noted in the following table. Expected volatilities are based on implied volatilities from traded options on the Company’s stock, historical volatility of the Company’s stock, and other factors. The Company uses historical employee exercise data to estimate the expected term of awards granted used in the valuation model. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant. The dividend yield is assumed to be zero based on the Company’s history and expectation of not paying dividends.

2010

2009

2008

Expected volatility

74.4% to 75.9%

73.6% to 76.7%

53.0% to 55.9%

Expected term (in years)

4.0

Risk-free rate

1.18% to 2.58%

2.33% to 2.46%

2.98% to 3.15%

Annual forfeiture rate

10.0%

A summary of stock option/SARs activity under the LTIP Plans and the 2003 Plan as of December 31, 2010, and changes during the year then ended is presented below:


	LTIP Plans					The 2003 Plan
				Weighted					Weighted
				Average					Average
				Exercise					Exercise
	Options/SARs			Price		Options			Price

Outstanding at January 1		15,892,528		$	19.02		13,526,670		$	5.66
Granted		3,165,950			7.07		—			—
Exercised		(100,366	)		4.86		(211,575	)		5.00
Forfeited or Expired		(3,573,824	)		30.51		(106,712	)		6.94

Outstanding at December 31		15,384,288		$	13.99		13,208,383		$	5.66

Exercisable at December 31		7,290,070		$	21.32		13,206,599		$	5.66

Weighted Average Remaining Contractual Term of Options Outstanding (in years)		6.2					2.4

Aggregate Intrinsic Value of Options Outstanding	$	14,155,359				$	32,871,830

The aggregate intrinsic value of all vested options/SARs is $35 million and those options have an average remaining contractual life of 2.8 years. The weighted-average grant date fair value of options/SARs granted during 2010, 2009 and 2008 was $3.97, $2.54 and $3.78, respectively. The total intrinsic value of options/SARs exercised during 2010, 2009 and 2008 was $1 million, less than $1 million and $2 million, respectively.

A summary of the status of the Company’s non-vested options/SARs under all plans as of December 31, 2010, and changes during the year ended December 31, 2010, is presented below:


				Weighted
				Average
				Grant Date Fair
	Options/SARs			Value

Outstanding at January 1		6,765,581		$	4.02
Granted		3,165,950			3.97
Vested		(1,743,271	)		4.82
Forfeited		(92,258	)		3.82

Outstanding at December 31		8,096,002		$	3.83

As of December 31, 2010, there was $14 million of total unrecognized compensation cost related to non-vested stock options/SARs granted under the LTIP Plans and the 2003 Plan that is expected to be recognized over a weighted-average period of 3.4 years. The total fair value of stock options/SARs vested during the years ended December 31, 2010, 2009 and 2008, was $11 million, $10 million and $9 million, respectively.

Cash received by the Company from exercise of stock options for the years ended December 31, 2010, 2009 and 2008, was $1 million for each of those years. No tax benefit was realized as a result of stock options/SARs exercised in 2010 due to the tax valuation allowance discussed in Note 8.

Performance Share Awards Performance share awards are granted under the LTIP Plans, generally vest pursuant to a three year measurement period and are settled on the vesting date. The number of awards ultimately issued under performance share awards is contingent on AMR’s relative stock price performance compared to certain of its competitors over a three year period and can range from zero to 175 percent of the awards granted. The fair value of performance awards is calculated by multiplying the stock price on the date of grant by the expected payout percentage and the number of shares granted.

Activity during 2010 for performance awards accounted for as equity awards was:


				Weighted
				Average
				Remaining
				Contractual		Aggregate
	Awards			Term		Intrinsic Value

Outstanding at January 1		7,863,455
Granted		3,057,630
Settled		(324,462	)
Forfeited or Expired		(1,306,177	)

Outstanding at December 31		9,290,446			1.3	$	72,372,574

The aggregate intrinsic value represents the Company’s current estimate of the number of shares (9,290,446 shares at December 31, 2010) that will ultimately be distributed for outstanding awards computed using the market value of the Company’s common stock at December 31, 2010. The weighted-average grant date fair value per share of performance share awards granted during 2010, 2009, and 2008 was $7.01, $4.53 and $8.20, respectively. The total fair value of equity awards settled during the year ended December 31, 2010 was $2 million. As of December 31, 2010, there was $23 million of total unrecognized compensation cost related to performance share awards that is expected to be recognized over a period of 1.7 years.

Deferred Share Awards The distribution of deferred share awards granted under the LTIP Plans is based solely on a requisite service period (generally 36 months). Career equity awards granted to certain employees of the Company vest upon the retirement of those individuals. The fair value of each deferred award is based on AMR’s stock price on the measurement date.

Activity during 2010 for deferred awards accounted for as equity awards was:


				Weighted
				Average
				Remaining
				Contractual		Aggregate
	Shares			Term		Intrinsic Value

Outstanding at January 1		6,887,268
Granted		2,722,330
Settled		(628,270	)
Forfeited or Expired		(256,769	)

Outstanding at December 31		8,724,559			2.2	$	67,964,316

The weighted-average grant date fair value per share of deferred awards granted during 2010, 2009 and 2008 was $7.05, $4.57 and $8.23, respectively. The total fair value of awards settled during the years ended December 31, 2010, 2009 and 2008 was $3 million, $3 million and $6 million, respectively. As of December 31, 2010, there was $27 million of total unrecognized compensation cost related to deferred awards that is expected to be recognized over a weighted average period of 2.6 years.

Other Awards As of December 31, 2010, certain performance share agreements and deferred share award agreements were accounted for as a liability, or as equity, as appropriate, in the consolidated balance sheet as the plans only permit settlement in cash or the awards required that the employee meet certain performance conditions which were not subject to market measurement. As a result, awards under these agreements are marked to current market value. As of December 31, 2010, the aggregate intrinsic value of these awards was $4 million and the weighted average remaining contractual term of these awards was 2.8 years. The total fair value of awards settled during the years ended December 31, 2010, 2009 and 2008 was $2 million, $1 million, and $24 million respectively. As of December 31, 2010, there was $2 million of total unrecognized compensation cost related to other awards that is expected to be recognized over a weighted average period of 3.5 years.

Retirement Benefits

12 Months Ended

Dec. 31, 2010

Retirement Benefits [Abstract]

Retirement Benefits


10.	Retirement Benefits

All employees of the Company may participate in pension plans if they meet the plans’ eligibility requirements. The defined benefit plans provide benefits for participating employees based on years of service and average compensation for a specified period of time before retirement. The Company uses a December 31 measurement date for all of its defined benefit plans. American’s pilots also participate in a defined contribution plan for which Company contributions are determined as a percentage (11 percent) of participant compensation. Certain non-contract employees (including all new non-contract employees) participate in a defined contribution plan in which the Company will match the employees’ before-tax contribution on a dollar-for-dollar basis, up to 5.5 percent of their pensionable pay.

In addition to pension benefits, retiree medical and other postretirement benefits, including certain health care and life insurance benefits (which provide secondary coverage to Medicare), are provided to retired employees. The amount of health care benefits is limited to lifetime maximums as outlined in the plan. Certain employees of American and employees of certain other subsidiaries may become eligible for these benefits if they satisfy eligibility requirements during their working lives.

Certain employee groups make contributions toward funding a portion of their retiree health care benefits during their working lives. The Company funds benefits as incurred and makes contributions to match employee prefunding.

The following table provides a reconciliation of the changes in the pension and retiree medical and other benefit obligations and fair value of assets for the years ended December 31, 2010 and 2009, and a statement of funded status as of December 31, 2010 and 2009 (in millions):


							Retiree Medical and
	Pension Benefits						Other Benefits
	2010			2009			2010			2009

Reconciliation of benefit obligation
Obligation at January 1	$	12,003		$	10,884		$	2,827		$	2,779
Service cost		366			333			60			59
Interest cost		737			712			165			179
Actuarial (gain) loss		442			675			263			67
Plan amendments		1			—			(78	)		(101	)
Benefit payments		(581	)		(601	)		(140	)		(156	)

Obligation at December 31	$	12,968		$	12,003		$	3,097		$	2,827

Reconciliation of fair value of plan assets
Fair value of plan assets at January 1	$	7,051		$	6,714		$	206		$	161
Actual return on plan assets		837			928			17			34
Employer contributions		466			10			151			167
Benefit payments		(581	)		(601	)		(140	)		(156	)

Fair value of plan assets at December 31	$	7,773		$	7,051		$	234		$	206

Funded status at December 31	$	(5,195	)	$	(4,952	)	$	(2,863	)	$	(2,621	)

Amounts recognized in the consolidated balance sheets
Current liability	$	8		$	9		$	173		$	167
Noncurrent liability		5,187			4,943			2,690			2,454

	$	5,195		$	4,952		$	2,863		$	2,621

Amounts recognized in other comprehensive loss
Net actuarial loss (gain)	$	3,052		$	3,008		$	(128	)	$	(402	)
Prior service cost (credit)		81			94			(205	)		(147	)

	$	3,133		$	3,102		$	(333	)	$	(549	)

For plans with accumulated benefit obligations exceeding the fair value of plan assets
Projected benefit obligation (PBO)	$	12,968		$	11,977		$	—		$	—
Accumulated benefit obligation (ABO)		11,508			10,558			—			—
Accumulated postretirement benefit obligation (APBO)		—			—			3,097			2,827
Fair value of plan assets		7,773			7,027			234			206

ABO less fair value of plan assets		3,735			3,531			—			—

At December 31, 2010 and 2009, pension benefit plan assets of $264 million and $145 million, respectively, and retiree medical and other benefit plan assets of $232 million and $204 million, respectively, were invested in shares of certain mutual funds.

The following tables provide the components of net periodic benefit cost for the years ended December 31, 2010, 2009 and 2008 (in millions):


	Pension Benefits
	2010			2009			2008

Components of net periodic benefit cost
Defined benefit plans:
Service cost	$	366		$	333		$	324
Interest cost		737			712			684
Expected return on assets		(593	)		(566	)		(789	)
Amortization of:
Prior service cost		13			13			16
Settlement		—			—			103
Unrecognized net loss		154			145			3

Net periodic benefit cost for defined benefit plans		677			637			341
Defined contribution plans		168			168			170

	$	845		$	805		$	511


	Retiree Medical and Other Benefits
	2010			2009			2008

Components of net periodic benefit cost
Service cost	$	60		$	59		$	54
Interest cost		165			179			172
Expected return on assets		(18	)		(14	)		(20	)
Amortization of:
Prior service cost		(19	)		(8	)		(13	)
Unrecognized net loss (gain)		(10	)		(14	)		(22	)

Net periodic benefit cost	$	178		$	202		$	171

The estimated net loss and prior service cost for the defined benefit pension plans that will be amortized from Accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $154 million and $13 million, respectively. The estimated net gain and prior service credit for the retiree medical and other postretirement plans that will be amortized from Accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $9 million and $29 million, respectively.


							Retiree Medical and Other
	Pension Benefits						Benefits
	2010			2009			2010			2009

Weighted-average assumptions used to determine benefit obligations as of December 31
Discount rate		5.80	%		6.10	%		5.69	%		5.90	%
Salary scale (ultimate)		3.78			3.78			—			—


							Retiree Medical and Other
	Pension Benefits						Benefits
	2010			2009			2010			2009

Weighted-average assumptions used to determine net periodic benefit cost for the years ended December 31
Discount rate		6.10	%		6.50	%		5.90	%		6.50	%
Salary scale (ultimate)		3.78			3.78			—			—
Expected return on plan assets		8.50			8.75			8.50			8.75

As of December 31, 2010, the Company’s estimate of the long-term rate of return on plan assets was 8.50 percent based on the target asset allocation. Expected returns on longer duration bonds are based on yields to maturity of the bonds held at year-end. Expected returns on other assets are based on a combination of long-term historical returns, actual returns on plan assets achieved over the last ten years, current and expected market conditions, and expected value to be generated through active management, currency overlay and securities lending programs. The Company’s annualized ten-year rate of return on plan assets as of December 31, 2010, was approximately 7.74 percent.

The objectives of the Company’s investment policies are to: maintain sufficient income and liquidity to pay retirement benefits; produce a long-term rate of return that meets or exceeds the assumed rate of return for plan assets; limit the volatility of asset performance and funded status; and diversify assets among asset classes and investment managers.

Based on these investment objectives, a long-term strategic asset allocation has been established. This strategic allocation seeks to balance the potential benefit of improving funded position with the potential risk that the funded position would decline. The current strategic target asset allocation is as follows:


Asset Class/Sub-Class		Allowed Range

Equity		60% - 70%
Public:
U.S. Value		18% - 33%
International Value		14% - 24%
Emerging Markets		5% - 11%
Alternative Investments		0% - 18%
Fixed Income		30% - 40%
U.S. Long Duration		30% - 40%
Other		0% - 5%
Cash Equivalents		0% - 5%

Each asset class is actively managed and, historically, the plans’ assets have produced returns, net of management fees, in excess of the expected rate of return over the last ten years. Stocks and emerging market bonds are used to provide diversification and are expected to generate higher returns over the long-term than longer duration U.S. bonds. Public stocks are managed using a value investment approach in order to participate in the returns generated by stocks in the long-term, while reducing year-over-year volatility. Longer duration U.S. bonds are used to partially hedge the assets from declines in interest rates. Alternative (private) investments are used to provide expected returns in excess of the public markets over the long-term. Additionally, the Company engages currency overlay managers in an attempt to increase returns by protecting non-U.S. dollar denominated assets from a rise in the relative value of the U.S. dollar. The Company also participates in securities lending programs to generate additional income by loaning plan assets to borrowers on a fully collateralized basis. These programs are subject to market risk.

Investments in securities traded on recognized securities exchanges are valued at the last reported sales price on the last business day of the year. Securities traded in the over-the-counter market are valued at the last bid price. The money market fund is valued at fair value which represents the net asset value of the shares of such fund as of the close of business at the end of the period. Investments in limited partnerships are carried at estimated net asset value as determined by and reported by the general partners of the partnerships and represent the proportionate share of the estimated fair value of the underlying assets of the limited partnerships. Common/collective trusts are valued at net asset value based on the fair values of the underlying investments of the trusts as determined by the sponsor of the trusts. The 103-12 investment trust is valued at net asset value which is determined by the issuer at the end of each month and is based on the aggregate fair value of trust assets less liabilities, divided by the number of units outstanding. No changes in valuation techniques or inputs occurred during the period.

The fair values of the Company’s pension plan assets at December 31, 2010 and 2009, by asset category are as follows:


	Fair Value Measurements at December 31, 2010
	Quoted Prices in						Significant
	Active Markets			Significant			Unobservable
	for Identical			Observable			Inputs
	Assets (Level 1)			Inputs (Level 2)			(Level 3)		Total
	(In millions)

Asset Category
Cash and cash equivalents	$	269		$	—		$	—	$	269
Equity securities
International markets(a)(b)		2,025			—			—		2,025
Large-cap companies(b)		1,557			—			—		1,557
Mid-cap companies(b)		152			—			—		152
Small-cap companies(b)		37			—			—		37
Fixed Income
Corporate bonds(c)		—			1,593			—		1,593
Government securities(d)		—			1,194			—		1,194
U.S. municipal securities		—			39			—		39
Alternative investments
Private equity partnerships(e)		—			—			795		795
Common/collective and 103-12 investment trusts(f)		—			145			—		145
Interest rate swap contracts — net(g)		—			(74	)		—		(74	)
Insurance group annuity contracts		—			—			3		3
Dividend and interest receivable		37			—			—		37
Due to/from brokers for sale of securities — net		(11	)		—			—		(11	)
Swap income receivable		8			—			—		8
Other assets — net		4			—			—		4

Total	$	4,078		$	2,897		$	798	$	7,773


(a)		Holdings are diversified as follows: 20 percent United Kingdom, 14 percent Japan, 9 percent France, 8 percent Switzerland, 7 percent Germany, 5 percent Netherlands, 11 percent emerging markets and the remaining 26 percent with no concentration greater than 5 percent in any one country.

(b)		There are no significant concentration of holdings by company or industry.

(c)		Includes approximately 82 percent investments in corporate debt with a Standard and Poor’s (S&P) rating lower than A and 18 percent investments in corporate debt with an S&P rating A or higher. Holdings include 81 percent U.S. companies, 16 percent international companies and 3 percent emerging market companies.

(d)		Includes approximately 87 percent investments in domestic government securities and 13 percent in emerging market government securities. There are no significant foreign currency risks within this classification.

(e)		Includes limited partnerships that invest primarily in U.S. (92%) and European (8%) buyout opportunities of a range of privately held companies. The Master Trust does not have the right to redeem its limited partnership investment at its net asset value. Instead, the Master Trust receives distributions as the underlying assets are liquidated. It is estimated that the underlying assets of these funds will be gradually liquidated over the next 1 to 10 years. Additionally, the Master Trust has future funding commitments of approximately $389 million over the next 10 years.

(f)		Investment includes 64% in an emerging market 103-12 investment trust with investments in emerging country equity securities, 19% in Canadian segregated balanced value, income growth and diversified pooled funds and 17% in a common/collective trust investing in securities of smaller companies located outside the U.S., including developing markets. Requests for withdrawals must meet specific requirements with advance notice of redemption preferred.

(g)		Includes four interest rate swap agreements with notional value of $760 million and fair value of $75 million representing 99% of the balance.


	Fair Value Measurements at December 31, 2009
	Quoted Prices in				Significant
	Active Markets		Significant		Unobservable
	for Identical		Observable		Inputs
	Assets (Level 1)		Inputs (Level 2)		(Level 3)		Total
	(In millions)

Asset Category
Cash and cash equivalents	$	162	$	—	$	—	$	162
Equity securities
International markets(a)(e)		1,410		—		—		1,410
Large-cap companies(b)(e)		1,431		—		—		1,431
Mid-cap companies(c)(e)		241		—		—		241
Small-cap companies(d)(e)		49		—		—		49
Fixed Income
Corporate bonds(f)		—		2,023		—		2,023
Government securities(g)		—		793		—		793
U.S. municipal securities		—		40		—		40
Alternative investments
Private equity partnerships(h)		—		—		744		744
Common/collective and 103-12 investment trusts(i)		—		115		—		115
Insurance group annuity contracts		—		—		3		3
Dividend and interest receivable		40		—		—		40

Total	$	3,333	$	2,971	$	747	$	7,051


(a)		Holdings are diversified as follows: 20 percent United Kingdom, 14 percent Japan, 12 percent France, 10 percent Germany, 9 percent Switzerland, 6 percent Netherlands, 6 percent emerging markets and the remaining 23 percent with no concentration greater than 5 percent in any one country.

(b)		Holdings include 85 percent U.S. companies, 11 percent international companies and 4 percent emerging market companies traded in the U.S. markets.

(c)		Holdings include 85 percent U.S. companies, 13 percent international companies and 2 percent emerging market companies traded in the U.S. markets.

(d)		Holdings include 92 percent U.S. companies, 5 percent international companies and 3 percent emerging market companies traded in the U.S. markets.

(e)		There are no significant concentration of holdings by company or industry.


(f)		Includes approximately 76 percent investments in corporate debt with a Standard and Poor’s (S&P) rating lower than A and 24 percent investments in corporate debt with an S&P rating A or higher. Holdings include 81 percent U.S. companies, 17 percent international companies and 2 percent emerging market companies.

(g)		Includes approximately 80 percent investments in domestic government securities, 19 percent in emerging market government securities and 1 percent in other international government securities. There are no significant foreign currency risks within this classification.

(h)		Includes limited partnerships that invest primarily in U.S. (93 percent) and European (7 percent) buyout opportunities.

(i)		Includes investments in emerging markets, global small companies and Canadian segregated funds.

Not included in the above tables are receivables and payables for foreign currency forward contracts and futures contracts which net to approximately $3 million and collateral held on loaned securities and the obligation to return collateral on loaned securities which effectively net to zero.

Changes in fair value measurements of Level 3 investments during the year ended December 31, 2010, were as follows:


	Private Equity			Insurance Group
	Partnerships			Annuity Contracts

Beginning balance at December 31, 2009	$	744		$	3
Actual return on plan assets:
Relating to assets still held at the reporting date		1			—
Relating to assets sold during the period		69			—
Purchases, sales, settlements (net)		(19	)		—

Ending balance at December 31, 2010	$	795		$	3

Changes in fair value measurements of Level 3 investments during the year ended December 31, 2009, were as follows:


	Private Equity		Insurance Group
	Partnerships		Annuity Contracts

Beginning balance at December 31, 2008	$	613	$	3
Actual return on plan assets:
Relating to assets still held at the reporting date		47		—
Relating to assets sold during the period		1		—
Purchases, sales, settlements (net)		83		—

Ending balance at December 31, 2009	$	744	$	3

The fair values of the Company’s other postretirement benefit plan assets at December 31, 2010 by asset category were as follows:


	Fair Value Measurements at December 31, 2010
	Quoted Prices in				Significant
	Active Markets for		Significant		Unobservable
	Identical Assets		Observable		Inputs
	(Level 1)		Inputs (Level 2)		(Level 3)		Total
	(In millions)

Asset Category
Money market fund	$	4	$	—	$	—	$	4
Unitized mutual funds		—		230		—		230

Total	$	4	$	230	$	—	$	234

The fair values of the Company’s other postretirement benefit plan assets at December 31, 2009 by asset category were as follows:


	Fair Value Measurements at December 31, 2009
	Quoted Prices in
	Active Markets for		Significant		Significant
	Identical Assets		Observable		Unobservable
	(Level 1)		Inputs (Level 2)		Inputs (Level 3)		Total
	(In millions)

Asset Category
Money market fund	$	4	$	—	$	—	$	4
Unitized mutual funds		—		202		—		202

Total	$	4	$	202	$	—	$	206

Investments in the unitized mutual funds are carried at the per share net asset value and include approximately 27 percent of investments in non-U.S. common stocks in 2010 and approximately 25 percent of investments in non-U.S. common stocks in 2009. Net asset value is based on the fair market value of the funds’ underlying assets and liabilities at the date of determination. Investments in the money market fund are valued at fair value which represents the net assets value of the shares of such fund as of the close of business at the end of the period.


	2010			2009

Assumed health care trend rates at December 31
Health care cost trend rate assumed for next year		8.0	%		7.0	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)		4.5	%		4.5	%
Year that the rate reaches the ultimate trend rate		2018			2015

A one percentage point change in the assumed health care cost trend rates would have the following effects (in millions):


	One Percent		One Percent
	Increase		Decrease

Impact on 2010 service and interest cost		22		(22	)
Impact on postretirement benefit obligation as of December 31, 2010		235		(231	)

The Company is required to make minimum contributions to its defined benefit pension plans under the minimum funding requirements of ERISA, the Pension Funding Equity Act of 2004 and the Pension Protection Act of 2006. The Company estimates its 2011 required contribution to its defined benefit pension plans to be approximately $520 million under the provisions of these acts which reflects the Preservation of Access to Care for Medical Beneficiaries and Pension Relief Act of 2010 (the Relief Act), H.R. 3962. The Relief Act provides for temporary, targeted funding relief (subject to certain terms and conditions) for single employer and multiemployer pension plans that suffered significant losses in asset value due to the steep market slide in 2008. Under the Relief Act, the Company’s 2010 minimum required contribution to its defined benefit pension plans was reduced from $525 million to approximately $460 million

The following benefit payments, which reflect expected future service as appropriate, are expected to be paid:


			Retiree Medical
	Pension		and Other

2011		574		173
2012		602		170
2013		665		169
2014		729		170
2015		785		173
2016 — 2020		4,959		989

During 2008, AMR recorded a settlement charge totaling $103 million related to lump sum distributions from the Company’s defined benefit pension plans to pilots who retired. Pursuant to U.S. GAAP, the use of settlement accounting is required if, for a given year, the cost of all settlements exceeds, or is expected to exceed, the sum of the service cost and interest cost components of net periodic pension expense for a plan. Under settlement accounting, unrecognized plan gains or losses must be recognized immediately in proportion to the percentage reduction of the plan’s projected benefit obligation.

- Definition

Description containing the entire pension and other postretirement benefits disclosure as a single block of text.

+ References

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 158

-Paragraph 7, 21, 22

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5, 6, 7, 8

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 8

-Subparagraph m

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 106

-Paragraph 518

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 87

-Paragraph 264

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph b

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph a

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph h

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

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph q

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

-Publisher FASB

-Name FASB Staff Position (FSP)

-Number FAS106-2

-Paragraph 20, 21, 22

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

-Publisher FASB

-Name Emerging Issues Task Force (EITF)

-Number 03-2

-Paragraph 8

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

-Publisher AICPA

-Name Accounting Principles Board Opinion (APB)

-Number 30

-Paragraph 26

Reference 13: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Implementation Guide (Q and A)

-Number FAS88

-Paragraph 63

+ Details

Intangible Assets

12 Months Ended

Dec. 31, 2010

Intangible Assets [Abstract]

Intangible Assets


11.	Intangible Assets

The Company has recorded international slot and route authorities of $708 million and $736 million as of December 31, 2010 and 2009, respectively. The Company considers these assets indefinite life assets and as a result, they are not amortized but instead are tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. Such triggering events may include significant changes to the Company’s network or capacity, or the implementation of open skies agreements in countries where the Company operates flights.

In the fourth quarter of 2010, the Company performed its annual impairment testing on international slots and routes, at which time the net carrying value was reassessed for recoverability. It was determined through this annual impairment testing that the fair value of certain international routes in Latin America was less than the carrying value. Thus, the Company incurred an impairment charge of $28 million to write down the values of these and certain other slots and routes.

As there is minimal market activity for the valuation of routes and international slots and landing rights, the Company measures fair value with inputs using the income approach. The income approach uses valuation techniques, such as future cash flows, to convert future amounts to a single present discounted amount. The inputs utilized for these valuations are unobservable and reflect the Company’s assumptions about market participants and what they would use to value the routes and accordingly are considered Level 3 in the fair value hierarchy. The Company’s unobservable inputs are developed based on the best information available as of December 31, 2010.

The following tables provide information relating to the Company’s amortized intangible assets as of December 31 (in millions):


	2010
			Accumulated		Net Book
	Cost		Amortization		Value

Amortized intangible assets:
Airport operating rights	$	515	$	344	$	171
Gate lease rights		182		129		53

Total	$	697	$	473	$	224


	2009
			Accumulated		Net Book
	Cost		Amortization		Value

Amortized intangible assets:
Airport operating rights	$	515	$	323	$	192
Gate lease rights		182		122		60

Total	$	697	$	445	$	252

Airport operating and gate lease rights are being amortized on a straight-line basis over 25 years to a zero residual value. The Company recorded amortization expense related to these intangible assets of approximately $28 million for each of the years ended December 31, 2010, 2009 and 2008, respectively. The Company expects to record annual amortization expense averaging approximately $24 million in each of the next five years related to these intangible assets.

Accumulated Other Comprehensive Income (Loss)

12 Months Ended

Dec. 31, 2010

Accumulated Other Comprehensive Income (Loss) [Abstract]

Accumulated Other Comprehensive Income (Loss)


12.	Accumulated Other Comprehensive Income (Loss)

The components of Accumulated other comprehensive income (loss) are as follows (in millions):


	Pension
	and			Unrealized						Income
	Retiree			Gain/(Loss)			Derivative			Tax
	Medical			on			Financial			Benefit/
	Liability			Investments			Instruments			(Expense)			Total

Balance at January 1, 2008	$	288		$	(3	)	$	240		$	145		$	670
Current year change		(2,707	)		(7	)		—			—			(2,714	)
Amortization of actuarial loss and prior service cost		(17	)		—			—			—			(17	)
Reclassification of derivative financial instruments into earnings		—			—			(378	)		—			(378	)
Change in fair value of derivative financial instruments		—			—			(738	)		—			(738	)

Balance at December 31, 2008	$	(2,436	)	$	(10	)	$	(876	)	$	145		$	(3,177	)
Current year change		(253	)		5			—			—			(248	)
Amortization of actuarial loss and prior service cost		136			—			—			—			136
Reclassification of derivative financial instruments into earnings		—			—			662			—			662
Non-cash tax provision		—			—			—			(248	)		(248	)
Change in fair value of derivative financial instruments		—			—			151			—			151

Balance at December 31, 2009	$	(2,553	)	$	(5	)	$	(63	)	$	(103	)	$	(2,724	)
Current year change		(385	)		—									(385	)
Amortization of actuarial loss and prior service cost		138			—			—			—			138
Reclassification of derivative financial instruments into earnings		—			—			144			—			144
Change in fair value of derivative financial instruments		—			—			72			—			72

Balance at December 31, 2010	$	(2,800	)		(5	)		153		$	(103	)	$	(2,755	)

As of December 31, 2010, the Company estimates that during the next twelve months it will reclassify from Accumulated other comprehensive loss into earnings approximately $121 million in net gains (based on prices as of December 31, 2010) related to its fuel derivative hedges.

The difference between Net earnings (loss) and other comprehensive income (loss) for the twelve month periods ended December 31, 2010 and 2009 is due primarily to the accounting for the Company’s derivative financial instruments and the actuarial loss on the pension benefit obligation of the Company’s pension plans.

Amounts allocated to other comprehensive income for income taxes as further described in Note 8 will remain in Accumulated other comprehensive income until the Company ceases all related activities, such as termination of the pension plan.

Earnings (Loss) Per Share

12 Months Ended

Dec. 31, 2010

Earnings (Loss) Per Share [Abstract]

Earnings (Loss) Per Share


13.	Earnings (Loss) Per Share

The following table sets forth the computation of basic and diluted earnings (loss) per share (in millions, except per share amounts):


	Year Ended December 31,
	2010			2009			2008

Numerator:
Net earnings (loss) — numerator for basic earnings (loss) per share	$	(471	)	$	(1,468	)	$	(2,118	)
Denominator:
Denominator for basic earnings (loss) per share — weighted average shares		333			294			259
Effect of dilutive securities:
Employee options and shares		—			—			—
Assumed treasury shares purchased		—			—			—

Diluted potential common shares		—			—			—
Denominator for diluted earnings loss per share — weighted-average shares		333			294			259

Basic earnings (loss) per share	$	(1.41	)	$	(4.99	)	$	(8.16	)

Diluted earnings (loss) per share	$	(1.41	)	$	(4.99	)	$	(8.16	)

The following were excluded from the calculation:
Convertible notes, employee stock options and deferred stock because inclusion would be anti-dilutive		57			19			36
Employee stock options because the options’ exercise price was greater than the average market price of the shares		12			18			13

Segment Reporting

12 Months Ended

Dec. 31, 2010

Segment Reporting [Abstract]

Segment Reporting


14.	Segment Reporting

The Company’s operations of American and AMR Eagle are treated as an integrated route network and the route scheduling system maximizes the operating results of the Company. The Company’s chief operating decision maker makes resource allocation decisions to maximize the Company’s consolidated financial results. Based on the way the Company treats the network and the manner in which resource allocation decisions are made, the Company has only one operating segment for financial reporting purposes consisting of the operations of American and AMR Eagle.

American, AMR Eagle and the AmericanConnection^® airline serve more than 250 cities in approximately 50 countries with, on average, 3,400 daily flights. The combined network fleet numbers approximately 900 aircraft. American is also one of the largest scheduled air freight carriers in the world, providing a wide range of freight and mail services to shippers throughout its system onboard American’s passenger fleet. AMR Eagle owns two regional airlines, which do business as “American Eagle” — American Eagle Airlines, Inc. and Executive Airlines, Inc. The American Eagle^® carriers provide service from throughout the U.S., Canada, Mexico and the Caribbean.

Revenues from other segments are below the quantitative threshold for determining reportable segments and consist primarily of revenues from American Beacon Advisors, Inc. (divested in 2008) and Americas Ground Services, Inc. The difference between the financial information of the Company’s one reportable segment and the financial information included in the accompanying consolidated statements of operations and balance sheets as a result of these entities is not material.

The Company’s operating revenues by geographic region (as defined by DOT) are summarized below (in millions):


	Year Ended December 31,
	2010		2009		2008

DOT Domestic	$	13,081	$	11,974	$	14,135
DOT Latin America		4,619		4,114		4,927
DOT Atlantic		3,365		2,973		3,671
DOT Pacific		1,105		856		1,033

Total consolidated revenues	$	22,170	$	19,917	$	23,766

The Company attributes operating revenues by geographic region based upon the origin and destination of each flight segment. The Company’s tangible assets consist primarily of flight equipment, which are mobile across geographic markets and, therefore, have not been allocated.

Quarterly Financial Data (Unaudited)

12 Months Ended

Dec. 31, 2010

Quarterly Financial Data (Unaudited) [Abstract]

Quarterly Financial Data (Unaudited)


15.	Quarterly Financial Data (Unaudited)

Unaudited summarized financial data by quarter for 2010 and 2009 (in millions, except per share amounts):


	First			Second			Third			Fourth
	Quarter			Quarter			Quarter			Quarter

2010
Operating revenues	$	5,068		$	5,674		$	5,842		$	5,586
Operating income (loss)		(298	)		196			342			68
Net earnings (loss)		(505	)		(11	)		143			(97	)
Earnings (loss) per share:
Basic		(1.52	)		(0.03	)		0.43			(0.29	)
Diluted		(1.52	)		(0.03	)		0.39			(0.29	)
2009
Operating revenues	$	4,839		$	4,889		$	5,127		$	5,062
Operating income (loss)		(194	)		(226	)		(194	)		(390	)
Net earnings (loss)		(375	)		(390	)		(359	)		(344	)
Earnings (loss) per share:
Basic		(1.35	)		(1.39	)		(1.26	)		(1.03	)
Diluted		(1.35	)		(1.39	)		(1.26	)		(1.03	)

The first, second and third quarter 2009 results include the impact of approximately $13 million, $70 million and $94 million, respectively, in charges related to the sale leaseback of certain aircraft and the grounding of leased Airbus A300 aircraft prior to lease expiration.

The results for the fourth quarter of 2009 include an impairment charge of approximately $138 million to write down certain route and slot authorities, primarily in Latin America, and certain Embraer RJ-135 aircraft to their estimated fair values, as well as $30 million in charges associated with the grounding of the Airbus A300 fleet and the sale leaseback of certain aircraft. Also included in 2009 results is a $248 million non-cash tax benefit resulting from the allocation of the tax expense to other comprehensive income items recognized during 2009.

The first quarter 2010 results include a loss of $53 million related to a currency remeasurement due to the devaluation of Venezuelan currency from 2.15 bolivars per U.S. dollar to 4.30 bolivars per U.S. dollar.

The Company’s fourth quarter 2010 performance includes an impairment charge of approximately $28 million to write down certain route and slot authorities in Latin America.

- Definition

This element can be used to disclose the entire quarterly financial data disclosure in the annual financial statements as a single block of text. The disclosure includes a tabular presentation of financial information for each fiscal quarter for the current and previous year, including revenues, gross profit, income (loss) before extraordinary items and cumulative effect of a change in accounting principle and earnings per share data. It also includes an indication if the information in the note is unaudited, comments on the aggregate effect of year-end adjustments, and an explanation of matters or transactions that affect comparability or are pertinent to an understanding of the information furnished. Alternatively, the details of this disclosure can be reported using the elements in this group, or by using other taxonomy elements and applying the appropriate quarterly date and period contexts when creating an instance document. For example, the element for "Interest and Dividend Income, Operating" may be used by financial institutions from the Statement of Income, applying the appropriate quarterly date and period context when creating an instance document.

+ References+ Details

Valuation and Qualifying Accounts and Reserves

12 Months Ended

Dec. 31, 2010

Valuation and Qualifying Accounts and Reserves [Abstract]

Valuation and Qualifying Accounts and Reserves

Schedule II — Valuation and Qualifying Accounts and Reserves


			Changes
			Charged to								Sales,
	Balance at		Statement of					Write-Offs			Retirements			Balance at
	Beginning		Operations					(Net of			and			End of
	of Year		Accounts		Payments			Recoveries)			Transfers			Year
	(In millions)

Year ended December 31, 2010
Allowance for obsolescence of inventories	$	509	$	32	$	—		$	—		$	(11	)	$	530
Allowance for uncollectible accounts		58		5		—			(5	)		—			58
Reserves for environmental remediation costs		18		—		(1	)		—			—			17
Year ended December 31, 2009
Allowance for obsolescence of inventories	$	488	$	40	$	—		$	—		$	(19	)	$	509
Allowance for uncollectible accounts		49		6		—			3			—			58
Reserves for environmental remediation costs		18		1		(1	)		—			—			18
Year ended December 31, 2008
Allowance for obsolescence of inventories	$	424	$	101	$	—		$	—		$	(37	)	$	488
Allowance for uncollectible accounts		41		6		—			2			—			49
Reserves for environmental remediation costs		21		2		(5	)		—			—			18