A legal battle playing out between American Airlines on one side and the city of Chicago and United Airlines on the other could shape the future competitive landscape at Chicago O'Hare.
At issue is scarce gate space at the airport, the nation's fourth busiest, in which both United and American maintain hubs. United currently utilizes 90 O'Hare gates, according to the Chicago Department of Aviation, while American utilizes 71. But the balance would shift further in United's favor if a preliminary gate space redistribution by the city is implemented.
Under the proposed decision, United would gain approximately five gates and American would lose approximately four gates, according to a lawsuit American filed against the city on May 2. Under O'Hare's formula, gate access is redistributed based on how much each carrier utilized their gates during the previous calendar year. The changes would take effect in October.
United, which has petitioned to intervene in the case on the side of the city, said that it could actually gain six or more gates. Chicago is slated to announce a final determination on June 1.
Brett Snyder, an airline industry analyst who pens the Cranky Flier blog, said that a United net pickup of 10 gates on American at O'Hare could be decisive for the airline, which has already substantially tipped the balance of power at the airport in its favor.
"This could set in motion a process for United to keep getting gates while making it harder for American to continue to keep the gates it has," Snyder said.
Post-pandemic usage gap
United built back from the pandemic much quicker at O'Hare than American, increasing its annual seat count lead at the airport between 2019 and 2024 from 9.3 million to 13 million. Last year, American offered 24.3% fewer O'Hare seats than in 2019, while United flew 99.2% of its 2019 seat count, Cirium flight schedule data shows.
This summer, United is slated to fly 10.2% more O'Hare seats than last summer. American, meanwhile, is building aggressively at O'Hare and has upped its summer schedule by 20.9% year over year.
At the heart of American's lawsuit is timing. The airline contends that the city of Chicago, at the request of United, began the gate redetermination process prematurely and in violation of a lease agreement that the Department of Aviation negotiated with airlines in 2018 to lay the groundwork for an O'Hare expansion.
During those 2018 negotiations, American declined to sign on until the city agreed to expedite the construction of three common-use gates in the airport's L Concourse, next to gates American already operates. The last of those so-called L-Stinger gates became operational on March 14.
In its complaint, American contends that it signed onto the 2018 lease agreement after extracting a commitment from the city that it would have 12 months to ramp up its gate usage after all the new L-Stinger gates became operational. Only then could the Department of Aviation conduct a usage assessment. With American aggressively growing at O'Hare this year, its allocation would presumably be higher if the process were delayed.
But language in the lease instead sets the timing of the reallocation around completion of expansion work in Terminal 5. For its argument, American is relying on a map, referenced in that same lease clause, that depicts the L-Stinger gates as well as on separate communications with the city.
Will AA fight to keep up?
In its Q1 earnings call, United boasted of its growing strength in terms of brand-loyal passengers at O'Hare and other hubs. At O'Hare, those claims are supported by the carrier's growing gap over American in terms of yield, defined as revenue per passenger mile flown: United did 13% better on per-mile yield than American in the fourth quarter of 2024, according to Cirium.
Snyder said that if United's gate lead at American increases, American could still fight back. But doing so might not be worth it.
"If United keeps up the pressure and they utilize the hell out of those gates, then they will probably get a higher percentage of total traffic," he said. "What American can do is try to keep up and keep adding and adding. Or they may decide it's not worth it and drop back in Chicago."
A status hearing in American's case is set for June 25.