What you need to know to navigate upcoming changes to frequent travel programs.
To paraphrase Bette Davis, “Fasten your seatbelts, it’s going to be a bumpy ride.” With the new year comes changes to many frequent travel programs and for many frequent flyer program members, your miles won’t take you as far as in the past. Not all of the changes will cause turbulence for members, but some of the modifications are a rather big departure from what the program was before so members would do well to pay attention to how their programs are evolving. We’ve rounded up some of the major developments from frequent traveler programs this year.
Aeroplan has launched a new tiered recognition program called Distinction that takes into account all miles earned by members, including airline, travel, retail and financial partners. There are three levels: dSilver (25,000 miles in a calendar year), dBlack (50,000 miles in a calendar year) and dDiamond (100,000 miles in a calendar year). Members will get discounted flight awards, bonus miles offers and other privileges. You can read more about Distinction at distinction.aeroplan.com.
Market Fare Flight Rewards replaced ClassicPlus Flight Rewards. These new revenue-based awards offer access to every available seat on flights operated by Air Canada. Aeroplan stated that Market Fare Flight Rewards will “offer a savings of up to 20 percent for non-elite Aeroplan members and up to a 50 percent discount for Distinction members.”
Also in 2014, many ClassicFlight awards have increased by 25,000 to 40,000 miles, including first and business class flights between the U.S. and Canada to Asia 1, Asia 2, Middle East/North Africa and Australia/New Zealand/South Pacific. For example, flights between Canada/Continental U.S. and Asia 1 in business class have risen from 125,000 miles to 150,000 miles and first class is now 210,000 miles from 175,000 miles. Flights between Canada/Continental U.S. and Asia 2 are now 180,000 miles in business class and 215,000 miles in first class, up from 130,000 miles and 155,000 miles, respectively. Flights between Canada/Continental U.S. and Middle East/North Africa are now 190,000 miles in business class and 230,000 miles in first class, up from 135,000 miles and 165,000 miles, respectively. Flights between Canada/Continental U.S. and Australia/New Zealand/South Pacific are now 185,000 miles in business class and 220,000 miles in first class, up from 135,000 miles and 160,000 miles, respectively. Note that business class to Middle East/North Africa and Australia/New Zealand/South Pacific once were both 135,000 miles but now, business flights to Middle East/North Africa will be 5,000 miles more than flights to Australia/New Zealand/South Pacific.
All economy flights within these regions remain the same as well as business and first class flights to Europe. You can read more about these changes at aeroplan.com/changes.
Other changes are that Aeroplan has discontinued the seven-year shelf life on miles and reduced the price of one-way awards to half the cost of a roundtrip, as of Jan. 1, 2014. The seven-year shelf life of miles was cancelled as of June 27, 2013. Members will still need to have account activity including earning or redemption during every 12-month period to keep their miles from expiring.
Bottom line: Gary Leff of View from the Wing stated about these changes, “Overall I like the changes to expiration, the status benefits for mileage earning seems an interesting concept though isn’t especially rewarding, and I view the award chart changes as a significant negative.”
Previously, one-way awards were 67 percent of the mileage required for a roundtrip award so the new 50 percent is a definite improvement. Aeroplan was one of the few FFPs that still required more than 50 percent of the miles for one-way awards. The program also went against the North American industry norm with its shelf-life for miles. Now, you can keep your miles alive indefinitely with yearly account activity and Aeroplan’s expiration policy is more in line with other North American-based programs.
Leff sums up Aeroplan like this: “My focus is and remains on saver awards, and especially on Star Alliance partners for their forward cabin (and that’s how I use Aeroplan, as an American Express Membership Rewards transfer partner).”
Alaska Airlines Mileage Plan
Effective for continental U.S. and Canada award travel booked on or after Jan. 14, 2014, some Mileage Plan flight awards have increased. Refundable coach tickets on Alaska Airlines are 60,000 miles roundtrip and 30,000 miles one way, an increase of 5,000 miles roundtrip and 2,500 miles one way. Refundable first class awards are 120,000 miles roundtrip, an increase of 20,000 miles and 60,000 miles one way, an increase of 10,000 miles. Refundable award tickets are, according to Mileage Plan, “available on every flight, every day, down to the very last seat on the airplane. Plus, no change or cancellation fees apply.”
Award flights to Hawaii have increased as well, with Choice economy flights to Hawaii having increased 2,500 miles to 30,000 miles one way, refundable economy flights increased 2,500 miles to 40,000 miles one way, saver first awards increased 2,500 miles to 40,000 miles one way and refundable first awards increased 5,000 miles to 80,000 miles one way. (Roundtrip amounts are doubled.)
Refundable economy awards to Mexico increased 2,500 miles to 35,000 miles one way, saver first awards decreased (yes, decreased—so it’s not all bad news) 2,500 miles to 30,000 miles one way and refundable first awards increased 10,000 miles one way to 70,000 miles on award flights to Mexico.
In other Alaska news, as of Jan. 15, 2014 Mileage Plan members can earn elite qualifying miles on all 12 of the carrier’s international airline partners. Along with Aeromexico, Air France, American Airlines, Delta Air Lines, Emirates, KLM and LAN, members can now also earn elite credit with British Airways, Cathay Pacific, Fiji Airways, Korean Air and Qantas.
Bottom line: Lucky of One Mile at a Time called Alaska’s award changes, “… the most minor award chart devaluation of the year.” And he was happy to see that the changes did not affect partner flights. After all, he says, “The way to maximize your Alaska miles has never been for travel on Alaska, but rather for travel on their partner airlines.”
There’s not much you can do about the price of awards going up after the fact, but if you are a regular flyer of any of Alaska’s partners, you might want to take a look at crediting your miles to Alaska Airlines and toward Mileage Plan elite rather than in the airline you are flying. And if you regularly fly two or more of the partner airlines, it’s definitely worth a look. But, keep in mind that being elite in Mileage Plan is really only a big plus if you also fly Alaska and can take advantage of the complimentary upgrades and other elite perks.
MVP is earned at 25,000 miles or by flying 30 segments on Alaska and partner airlines, MVP Gold at 50,000 miles or 60 segments and MVP Gold 75k at 90,000 miles or 90 segments. You can reach elite faster than these mileage thresholds when earning flight miles from flying solely on Alaska Airlines.
The big news for American AAdvantage members is the airline’s merger with US Airways. As of Jan. 7, 2014, members of American AAdvantage and US Airways Dividend Miles can earn and redeem in both programs and will have reciprocal elite benefits and lounge access. The airlines will then continue to align their product offerings throughout the year. The merged airline will use the current American product as its template so US Airways Dividend Miles members will notice more changes than AAdvantage members. On March 30, US Airways will leave Star Alliance and join American’s global alliance, oneworld on March 31, 2014. To follow news about the new American, visit aa.com/findyourway.
Bottom line: Members of frequent flyer programs have become accustomed to changes brought about by airline mergers and for now, the two airlines and frequent flyer programs will continue to operate independently, but this will change. The best advice we can give is for members to be verbal about matters that are important to them as the powers that be create the merged frequent flyer program. And if you have US Airways miles, spend them now for flights on Star Alliance partner airlines if any of those flights are in your travel plans.
It is speculated that the new American will continue to partner with Citi to issue their co-branded credit cards and if you haven’t already signed up for the US Airways Dividend Miles credit card issued by Barclays, now is a good time to apply and receive the sign-up bonus of up to 40,000 bonus miles, which will eventually be converted into AAdvantage miles, while the card is still available. The $89 annual fee on the card is waived the first year.
As of the first of the year, SkyMiles members earn Medallion elite status based on annual spend on Delta flights as well as the existing Medallion qualification miles (MQMs) or Medallion qualification segments (MQSs). The new threshold for cash is called Medallion qualification dollars (MQDs), which represent the amount spent on Delta tickets (not counting taxes and fees, but counting the base fare and carrier-imposed surcharges). Members will also earn MQDs for flights on certain airline partners that are ticketed through a Delta channel (the tickets will begin with “066”).
The spending thresholds needed to qualify for the status levels are as follows: $2,500 for Silver, $5,000 for Gold, $7,500 for Platinum and $12,500 for Diamond. Elite members in all status levels are offered a waiver for the MQDs if they spend at least $25,000 within a calendar year in eligible purchases on Delta SkyMiles credit cards (personal and business).
… as of March 1, 2014, Medallion complimentary upgrades will not be offered on flights between New York (JFK) and Los Angeles, San Francisco or Seattle.
As of March 1, 2013, the amount of Medallion Qualification Miles (MQMs) members earn on certain fares is changing. For Delta-marketed flights, members will no longer earn a 50 percent MQM bonus for economy M fares. First/business F and J fare classes will earn a 100 percent MQM bonus—doubled from the previous 50 percent MQM bonus for these fares. Some partner flights are also seeing changes to the MQMs earned. Visit delta.com/partnerairlines to learn more. Note that redeemable miles earned for any of these fares has not changed, only the amount of MQMs earned.
Delta also announced changes to their award charts for 2014 on two separate occasions which means that there’s an award chart effective for travel between Feb. 1 and May 31, 2014 and another for travel from June 1, 2013.
We’ll fast forward to June: Delta SkyMiles increased the number of miles required for award tickets on international business class routes at the low level. The change was announced on Aug. 14, 2013 and applies to travel beginning June 1, 2014. Delta SkyMiles business class award tickets on international routes increased around 7 to 25 percent with the new award chart.
In a move not popular with SkyMiles elite-level members, the program announced that as of March 1, 2014, Medallion complimentary upgrades will not be offered on flights between New York (JFK) and Los Angeles, San Francisco or Seattle. As of March 1, complimentary upgrades will be available between Hawaii and Los Angeles, Salt Lake City, San Francisco or Seattle as a new benefit, but, “… in light of significant investments in our coast-to-coast BusinessElite experience, which include premium amenities like fully flat-bed seats, Westin Heavenly inflight bedding, on-demand entertainment and premium dining,” says Delta, they are no longer able to offer free upgrades to their best members on these flights.
Another change to upgrades for elites was announced in December stating that as of March 2014, SkyMiles will be replacing their current systemwide upgrades with Regional upgrades that are available in the same markets as Medallion complimentary upgrades and Global upgrades that are available in all markets. Global and Regional upgrades will be valid on all paid economy class fares except for E, which is an improvement from previous upgrades. Top-level Diamond Medallion members may choose either four Global upgrades or eight Regional upgrades while Platinum Medallion members have the choice of four Regional upgrades—Platinum will not have the option of Global upgrades. Upgrades can also now only be used when the Medallion member is traveling as well as one companion.
Bottom line: Get used to a revenue component to Delta SkyMiles and other major airline programs. This is clearly the way forward for the programs where loyalty is measured in dollar signs. Regarding the award travel changes, Delta posted on their website, “In order to balance our continued investments in products and services, we periodically evaluate award pricing and adjust as necessary.”
We asked BoardingArea blogger, René from DeltaPoints.com to sum up his thoughts on the changes coming from Delta. He says: “Unless you are adding to Deltas’ bottom line in a substantial way, you will not be considered an HVC or ‘high value customer.’ This could mean purchasing expensive fare class tickets but it can equally mean high spending on co-branded credit cards. Delta is banking on the fact that frequent flyers will continue to adapt to these program changes by offering a superior product, reliability, WiFi and customer service. So far, they are pulling this off despite the devaluations and well-known challenges of redeeming SkyMiles. The risk Delta runs is going that ‘one step too far’ as they may have done by removing the chance for free elite upgrades between the JFK – LAX/SFO/SEA routes. This promises to be an interesting year as the announced changes roll out and take full effect—as well as just what will be revealed next.”
Hilton HHonors eliminated the option to earn Points & Fixed Miles for hotel stays, as of Jan. 6, 2014. This was one of two “double dip” options from HHonors. Now, members who wish to earn points and miles for hotel stays only have the option of Points & Variable Miles (which will now be called “Points & Miles”). You’ll earn one mile per dollar spent for a hotel stay instead of being able to choose to earn fixed amounts of 500, 250 or 100 miles per stay depending on hotel brand.
Bottom line: This change is especially bad for members who typically spend less than $500 at full-service hotels or less than $100 at discount hotels. Seth, also known as The Wandering Aramean, lamented the passing of Points & Fixed Miles by saying, “It was tremendous when crediting to certain partners for one-night stays, particularly at the cheaper properties. One could regularly rack up thousands of points in various airline programs at a very, very, very favorable rate versus the one point per dollar option or Points + Points.”
Hyatt Gold Passport
As of Jan. 7, 2014, Hyatt Gold Passport members can redeem points plus cash for a free night award—something other hotel programs have offered for years, but is a new option for Gold Passport members. The point amounts are reduced by 50 percent for the stay with standardized cash co-payments from $50 to $300 according to the hotel category.
Also as of that date, Gold Passport Platinum and Diamond members can now get 20 percent off the daily rate on any standard room (subject to availability) throughout the year through the new My Elite Rate offer.
Jan. 7 also marks the end of guests being able to purchase Hyatt Stay Certificates. Hyatt Stay Certificates were certificates that could be used toward hotel stays starting at $109 for one night, up to $461.11 to “Ultimate” hotel stays. Originally intended for members to hand out as gifts, they were often used by savvy members to get good deals on hotel stays. A stay at $461.11 might seem a bit pricey, but not if you consider that some of those stays would normally go for $700 or above. Hyatt Weekend Certificates and Hyatt Spa Certificates are also no longer available. All of the certificates already in circulation will be honored, but new ones will not be available except for businesses to purchase.
Another change for the program, and not good news for members, is that award categories are changing and the number of points required for award stays at Category 5, 6 and the new Category 7 properties is increasing and you will need to have account activity every 24 months to keep your membership active.
The number of points needed for an upgrade will also be calculated per night instead of up to a four-night stay. Regency Club/Grand Club upgrades will require 3,000 points per night and suite upgrades will require 6,000 points per night.
Bottom line: As Lucky at One Mile at a Time noted regarding the change from stays to nights when redeeming points for upgrades, “That’s a pretty substantial devaluation, as the cost of a suite upgrade has potentially increased by 300 percent.”
Regarding the award redemption changes, he said: “As much as I’m frustrated by an increase in the number of points required at many properties, I can understand the reasoning. When you redeem your Hyatt Gold Passport points for the Park Hyatt Sydney over summer (which I’m sure tons of people do) and the hotel is near full occupancy, Gold Passport is literally paying the hotels near the average daily rate. So redeeming your 22,000 Gold Passport points will cost them $800+.”
Boarding Area’s Wandering Aramean had this to say about why Hyatt decided to discontinue the stay certificates, “In other words, we don’t want end-users buying these to circumvent our revenue management controls so we’re pulling them off the market.”
Lufthansa Miles and More
Among other program changes, Miles and More members now earn fewer miles in some booking classes as of the first of the year. Within Germany, economy class flights in Q, S, V and W will earn 250 miles, down from 500 miles; in E and T class, members will get only 125 miles, down from 500 miles. Cross-border European flights in S and W economy class will earn 500 miles, down from 750 miles and T class will earn 125 miles, down from 750 miles. For worldwide, non-European destinations, economy class Q, S, V and W will offer 250 minimum miles, down from 500 minimum miles and members will earn 50 percent of the actual miles flown, down from 100 percent on these fares. In E, K, L and T on non-European routes, members will earn 250 minimum miles instead of 500 and only 25 percent of the actual mileage flown, which is down from the former 50 percent of the mileage flown. Miles and More says with these changes, “mileage credit in economy class will be linked even more closely to the value of the airline ticket.” These changes include flights on Austrian Airlines, Brussels Airlines, Lufthansa and SWISS.
Bottom line: The statement from Miles & More sums it up—the trend toward awarding loyalty according to dollars or euros spent applies.
Qantas Frequent Flyer
Qantas Frequent Flyer increased the number of points required to upgrade from discount economy seats to business class on domestic flights as of Jan. 14, 2014 by 25 percent. Points required for flight upgrade now range from 10,000 points (up from 8,000 points) to 30,000 points (up from 24,000 points).
Upgrades from economy fares including fully flexible and Flexi Saver, will remain at the current levels, between 5,000 and 15,000 miles according to flight distance.
Bottom line: North American programs are not the only ones to up the redemption amounts of awards this year.
Southwest Rapid Rewards
Southwest Rapid Rewards announced last September that as of March 31, 2014, the redemption rate for points exchanged for Wanna Get Away tickets will be 70 points per dollar instead of the current 60 points per dollar. For example, a $500 roundtrip ticket will be 35,000 points instead of 30,000 points.
Anytime and Business Select award redemption rates, as well as the points per dollar earned when flying, remains the same.
Bottom line: This is a devaluation of 15 percent. Lucky of One Mile at a Time said of the change, “…. while people will be frustrated, I don’t think they’ll change their behavior whether it takes 60 or 70 points per dollar. And I think Southwest knows that, and that’s why the email they sent out [to announce the change] doesn’t even try to come up with a BS excuse or explanation for why the increase is happening.”
Southwest Rapid Rewards members would do well to spend the points they have now …
In Southwest’s email to members, they simply stated, “We hope you understand that in order to continue providing these benefits, we must make changes to the Rapid Rewards program from time to time.”
Southwest Rapid Rewards members would do well to spend the points they have now before the change goes into effect for Wanna Get Away ticket awards booked on or after March 31. Southwest books about 180 or 200 days or so in advance.
As of January 2014, MileagePlus members in the U.S. must meet spending thresholds to qualify for Premier status. Along with the miles or segments needed to qualify for status levels, members will also have to reach spending thresholds: $2,500 for Silver, $5,000 for Gold, $7,500 for Platinum and $10,000 for 1K.
For 2014, the dollar requirement for Silver, Gold and Platinum status will be waived if you spend at least $25,000 in net purchases using a MileagePlus Chase co-branded credit card issued in the U.S. There is no waiver for 1K qualification and the credit card waiver is for existing cardmembers only.
Sweeping award changes to international business and first class awards went into effect Feb. 1, 2014 and it will now cost significantly more to travel on a partner airline. On some routes, the number of miles required for a partner flight will almost double. Economy award flights to Alaska are increasing 5,000 miles one way and flights to Hawaii are going up 2,500 miles one way.
Bottom line: Scott Mackenzie of BoardingArea’s Hack My Trip reminded his readers that to ensure you’re getting PDQs with partner airlines when purchasing through United Airlines, the ticket number should start with 016. He also says of the new PDQ requirement, “I also want to remind you that if you miss any one requirement, you will only earn the elite status entitled by the requirements you do meet. For example, if you earn $10,000 PQDs but earn only 25,000 PQMs, you will only get Premier Silver status. And if you earn 100,000 PQMs but only $7,500 PQDs, you will only get Premier Platinum status.”
Because programs can (and often do) change their programs at any time, and and the year is still new as this is being written, we expect that some changes will be announced after we have written this article. Stay tuned to InsideFlyer for further developments from programs in 2014.