That's how I read this modified 8K too, really nothing bad in it. There is an expectation that anytime you increase capacity (from your baseline) marginal revenue will decrease. It's unreasonable (and management knows that) that if your baseline ASMs were +20% YoY, and it increases to +23% YoY, that you will not fill that incremental 300bps of capacity at the same unit revenue. In fact, their guidance actually reflects a 100bps increase in total revenue. This is well within anyone's expectation in network planning when they increased capacity over baseline.

Fuel costs are roughly a 7% increase compared to prior guidance, also not a huge driver of the profit change.

In summary, a slight decrease in unit revenue for Q1, a slight increase in fuel cost, but a 600bps change in margin...that is being driven almost entirely by the retiming of costs associated with a potential new collective bargaining agreement with employees represented by the Air Line Pilots Association.

Like I said, nothing bad in here, it is my best guess that SK is using other factors (outside the UPA) to explain the change in margin outlook to not spook Wall Street with a massive cost change.

Bring on the massive cost change!!!