Is American Really Losing $1 Billion a Year at Chicago O'Hare? Here's What the Data Shows
TravelUnited CEO Scott Kirby has been direct about his prediction: American Airlines will eventually abandon its Chicago O’Hare hub after sustaining approximately $1 billion per year in operating losses there. American’s finance leadership says every hub contributes positively. Neither airline publishes hub-level P&L data. The federal database, however, does publish flight-level economics — and the numbers favor Kirby’s directional argument.
The Number
An analysis by @bentboolean using the Q2 2025 DB1B database — approximately 203,000 ORD-origin domestic tickets and Form 41 cost data — produced comparable unit economics for both carriers at O’Hare:
- United’s domestic revenue per available seat mile (RASM) out of Chicago is 10.5% higher than American’s across the same routes
- United’s domestic cost per available seat mile out of Chicago is 4.6% lower than American’s
- United operates 86% mainline aircraft at ORD versus American’s 76% — a fleet mix that typically produces better unit economics
Combined, United’s per-ASM margin runs approximately 31% higher than American’s at the same airport, across the same markets.
How the Math Works
The $1 billion figure is a claim about absolute operating results, not unit economics. No airline publishes hub-level P&L, so the number is officially unverifiable. The unit-economic gap, however, suggests the directional claim is plausible: if United is breaking even or profitable at ORD while American is 31% worse on a per-seat margin basis, and both carriers operate comparable total capacity, the gap could accumulate into nine-figure losses.
American’s counterargument — that loyalty program revenue, particularly the Citi co-brand partnership, partially offsets direct operating shortfalls — is legitimate but incomplete. Revenue from credit card partnerships is real, but it flows to the enterprise, not the hub P&L, and doesn’t close a structural unit-economics gap of that magnitude.
The independent analysis examined only domestic routes on the 18 largest ORD nonstop markets, finding that United out-yields American on 16 of 18. The summary from One Mile at a Time’s full breakdown puts the likely actual loss in the range of “hundreds of millions” rather than exactly $1 billion, after accounting for loyalty revenue. That is not a comfortable place to operate a major hub.
What It Signals
The Oneworld dimension matters for the reader tracking loyalty strategy. American operates its ORD hub as a Oneworld carrier, connecting traffic from partner airlines including British Airways and Iberia. A strategic retreat from Chicago — however unlikely in the near term — would reshape Oneworld connectivity in North America and affect how Emerald members route partner award itineraries through the midwest.
United CEO Kirby’s public pressure campaign may be partly strategic posturing, but the underlying unit-economics case isn’t manufactured. American faces structural disadvantages at ORD in revenue yield, cost structure, and fleet mix that compound rather than converge. The product improvement investments American has announced, including the new widebody reconfiguration program, aren’t scheduled for delivery until the 2030s.
The So What
The $1 billion figure may be imprecise, but the trend it describes is not. American’s position at O’Hare is structurally weaker than United’s by every measurable unit-economics metric, and the gap has not been closing. Travelers booking Oneworld itineraries through Chicago should assume American’s ORD position becomes more defensive over the medium term, not more expansive. Routing flexibility through alternative hubs — Philadelphia, Dallas, Miami — is the practical hedge.
Source: One Mile at a Time
Content created with AI assistance and reviewed for accuracy.
Join the conversation
Stack Insiders is our free community for readers who want to go deeper — share resources, ask questions, and connect with others across every vertical we cover.
Join Stack Insiders →