Question-and-Answer Session
Operator
Your first question comes from William Greene - Morgan Stanley.
William Greene - Morgan Stanley
I'm wondering if you can add a little bit more color about the fourth quarter RASM trend? Given what fuel has done, it seems that you've got some pretty robust expectations for RASM. I'm just trying to understand why you think that would continue, given the economic backdrop?
Glen Hauenstein
Bill, I think we have a couple of things going on here. Domestic seems to remain strong through the fourth quarter, and while we do have a fuel hit, certainly on the cost side, we have some very nice currency fluctuations going on with the foreign currencies. That's really driving double-digit unit revenue increases in the Trans-Atlantic and Latin American entities right now. So we see continued strength in the domestic and then really, what we are seeing on a year-over-year business is accelerating strength in the international driving the total RASM numbers.
William Greene - Morgan Stanley
I know you haven't given 2008 guidance, but if we see further weakness, what kind of flexibility do you have on the capacity front to pull it back, relative to where we are at in the plan right now?
Ed Bastian
Bill, as a result of the restructuring, we've reduced the cost of our fleet substantially. In fact on comparative pre-restructuring levels almost $500 million a year of fleet savings. The cost impact of grounding domestic capacity, particularly regional jets, is not going to be substantial as compared to what it would have been previous to our work. So I think capacities, particularity on the domestic side, is the number one focus that we deploy.
William Greene - Morgan Stanley
But just to be clear, could we get to a situation where you'd have instead of a 3% capacity number, could it be as much as flat or slightly down, or is that too big of a change?
Ed Bastian
Again, our capacity for this year is flat for the domestic market. For mainline domestic, in fact, it's been down year over year. The only capacity growth we've got going on in domestic is the up-gauging of regionals from 50-seat to 76-seaters, as we're getting rid of those 50-seaters. So from our perspective the down gauging is working quite effectively in the domestic marketplace, and the international markets that we're going into are new territories with much, much more robust economic expectations and projections which you're seeing that in our numbers currently.
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