In our annual review of trends in frequent flyer program redemption, we found that airlines awarded well over 20 million free tickets in 2004. Interestingly, more and more travelers are opting to redeem their miles for tickets on partner airlines rather than the airline on which they earned the miles in these programs because of partnerships and alliances. For instance, American AAdvantage redeemed nearly 2.6 million free tickets on American, American Eagle and AmericanConnection, but nearly one million free tickets were also redeemed on other airlines.
But among the statistics we examined, perhaps the most interesting was that the percentage of passengers flying for free dropped this past year when comparing raw numbers. This no doubt was not due to the airlines cutting back on award redemption, but, was a result of many members earning, bonus free flights from “Fly Three… ” promotions, which took the place of normal award redemption. Continental OnePass, which saw a 20-percent drop in awards on Continental aircraft experienced the largest decrease in award redemption. However, overall award redemption was up because of the new full-year alliance with Delta in 2004. And as might have been expected, US Airways led all programs with a 25-percent increase in award redemption as members flocked to preserve their miles given the financial woes US Airways suffered in 2004.