The irony and hypocrisy of Air Canada

Discussion in 'Air Canada | Aeroplan' started by Canadi>n, Sep 26, 2013.  |  Print Topic

  1. Canadi>n
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    Canadi>n Gold Member

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    Okay, so we've just suffered the latest volley by AC against we "bottom feeders" i.e. those of us here on MP and over at FT who pay for our own flights and have no massive corporate companies or clients to foot our travel expenses. It strikes me odd that, given the whole purpose of FT, and Randy's successor MP, was to create a place where we could exchange information and strategies to maximize our earning of miles/points and status, while spending the least amount of money. (And on the other side of these programs, maximize the benefits from award redemptions.)

    So here's AC which has year by year been tightening the screws (hiring one of our number away to advise on these changes too) and reducing benefits on both sides of the equation: fewer mileage earning, upgrade eligible fares; higher fees and surcharges on award tickets as well as increasing mileage required. That same AC will be co-hosting this year's STARMegaDO5 in Toronto. How ironic that the airline that has been leading the charge against those of us who participate in these fora, should be spending thousands to wine and dine these same "bottom feeders" it so despises otherwise.

    Two years ago in Montreal, it was AE and AC who hosted this same group, and thereafter began the AE crusade of piling more and more charges on its award tickets, while AC promised to improve the elite tier program and ability to upgrade [by replacing certs with eCredits]. At least from that reception I have my 777 model that I won't be getting because I long ago gave up the quest for MM/lifetime Elite status (having flown over 1.25 million AC seat miles since the start of Aeroplan in 1984 and another 750K+ on CP but AC not recognizing flights from the first 4-1/2 years of Aeroplan nor any CP flown mileage, which is something no other MM program does). The model 777 appears now to be about the only tangible benefit of MM/lifetime Elite left, now that the benefits of that elite tier has been obliterated with upgrade copays and rejiggered upgrade-eligible fares.

    Wonder how the AC hosts will respond to questions about the changes from the handful of AC FFers (all but one I know who have left AC for UA) who'll be at their reception in Toronto?
     
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  2. mtlfire

    mtlfire Gold Member

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    It will be my first SMD do this year. I clearly meet the definition of bottom feeder :D

    The greatest change for me is Rouge. By next year they will fly a good portion of the routes I was on that got my status. I won't be able to maintain status and keep flying AC metal. As I've mentioned in another thread though -- this penalizes AC more the AE assuming I keep crediting back to AE (so you might know two bottom feeders that still haven't changed at SMD lol).

    Granted, its a big plane, and not everyone that is going seems to be posting. But from reading the SMD threads and looking at the various signatures of those that post.... with the multiple airline, hotel and car statuses that some people hold. I can't say I see many bottom feeders on the plane yet :p

    Now if only there were better credit card options for non AE cards in Canada.
     
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  3. Canadi>n
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    Canadi>n Gold Member

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    Having been to every SMD including last week's NordicDo, I can assure you that just about every one of the attendees is a "bottom feeder" one way or another. Very few have the luxury of not being so. And that's why they have the variety of statuses they have. They've parlayed the game to its maximum extent...particularly easy to do in the US. And the majority of Canadians who are going, once AC loyalists, have moved onto UA because of the abuse they've received at the hands of our "national" carrier. (Not to mention most no longer have an AC-affiliated cc, earning hotel points with their cc, and relying on seat miles to built up their FF accounts. As I prefaced, that's what MP and FT are all about.
     
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  4. AC is slowly divorcing themselves from AE because they don't get the benefit of points accumulated in Aeroplan from other sources. That's the driver here. And , AC is apparently not afraid to make moves to enhance their profits so yes there is a risk there that can be easily changed within seconds if it becomes a revenue issue . I have been hearing for years about people leaving AC for greener pastures but their record loads and increasing profits don't jive with your so called use of the word "abuse". You call losing freebies as "abuse". Most people who can count see it as a dollars and sense issue and the "very few" people who do depart seem to get replaced and then some. I'm not sure that 16,000 or so SE's including several hundred 2mm'ers and thousands of MM'ers "get" your abuse calculation.
    Maybe these boards would have more credibility with the airlines if the biggest complainers were top tier passengers and not people who can't even fly anymore as a leader of the so called opposition or those simply whining about the lack of freebies that they were getting on their company paid flights.
     
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  5. YEGman

    YEGman Silver Member

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    I left for greener pastures years ago and despite the occasional trip to YYZ on the Central Canadian Carrier don't regret it one iota. Then again, I pay for 95% of my air travel out of my own pocket so unlike expense account 'abusers' like parnel I know the value of a dollar.
     
  6. Canadi>n
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    Canadi>n Gold Member

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    I bet if you go back to the old AC forum crew of FT, only two or three at most still consider AE their primary FF program. Everyone else has migrated to UA/MP and a few of us from the CP world to AA...not a few can support top tier elite in both. And those who fly overseas may have gone over to CX or SQ.
     
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  7. slalom

    slalom Silver Member

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    This is so funny...the personal stuff....For the last 20 years I've been off and on E/SE, UA1K, Prestige, plebe, etc. depending on work, along with whatever hotel or car programs have been convenient at different times of my career. I've always just taken whatever status comes with my job, and never actively managed it .... probably missed out on a lot over the years because of this attitude.

    I can't remember why I found MP earlier this year....I think I googled a question about how to use points and found an answer here so I joined and for the past few months, I get on here fairly regularly to get tips on accumulating miles (I went from dirt to 50K starting halfway through last year).

    I'm in AC/Aeroplan (just got my "early recognition" at 75 K and headed to SE AQS territory with the help of a couple of extra stops (EWR-YUL-YYZ instead of EWR-YYZ - great trick learned here and validated by guinessxyz...thanks!...been an easy trip, but I may have overdone it...I think I'll wind up 105 AQS for the year) for better or worse because I live near YYZ and do mostly transborder travel. Perhaps I could get one more short-haul flight or upgrade or whatever based on my travel if I switched to another program but in my view, if you have time to figure that out among all the travel instead of walking in fresh air, relaxing, sharing a drink, whatever....you are missing the point of the points.

    I have one life to live, and I'd rather enjoy with fantastic weekends (skiing in Utah, Caribbean, San Fran, Chicago, NYC, ) using freebies (plus annoying fees) that make up for many days traveling away from friends and family (130 hotel nights this year and counting).

    I'm glad I can learn from those of you that spend the time analyzing the programs....but how did it get so personal between people who (I assume) only really know each other on-line?
     
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  8. Randy Petersen
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    Randy Petersen Founder

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    The items mentioned here seem to be identical to changes made at other competing programs in North America. Did AAdvantage not introduce co-pays more than a decade ago? Has DL not tuned their upgrade eligible fares? While I can see your personal frustration with the program, haven't you, I and many others learned to choose and adopt to a program that best fits our current needs? Strange as it may seem, I recall Air Canada being the best host of all the sponsors of the one in which you received the model 777. Anyway, like you and others, I'll ask and listen to what they say about where things are today and maybe a forecast about tomorrow at the upcoming MegaDO, but I won't assume that my personal interest reflects the same interest of all members of that program. I actually know members who are quite happy with the program.

    Always appreciate your perspective.

    NOTE: since the thread topic alludes to be about Air Canada and it's the best use of readers time to stay on that topic, the off-shoot of some personal conversations is still here on MilePoint, just located in a more suitable venue.
     
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  9. Canadi>n
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    Canadi>n Gold Member

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    With due respect, the changes introduced by AC are quite a bit different from those made by AA, UA and DL. AA (and UA, not sure about DL program) copays for upgrades only apply to mileage ones, not eVIPs or SWUs which are the direct comparison of AC's eUpgrade credits. None of the US programs has reduced mileage earning on their lowest fares below 100% EQMs/PQMs as AC has done on overseas routes with the Tango change. And you haven't even acknowledged the other side of AC's FF program: redemptions. The term "scam charges" was developed by AC fliers who were disgusted with the huge additional fees charged for AE award tickets on most STAR carriers. It is surely scandalous that I can booked the same award flights with my MP miles on AC metal and pay $56 in fees, while the same award using my AE miles would cost me $158! (I'm using that award at the moment.)

    Then there's AC's MM program which is not the same as those of the US airlines. When UA merged with CO, the eligible mileage earned in each program was merged. When DL took over NW, those eligible miles were merged. But when AC introduced its MM program, management made a conscious decision to exclude otherwise eligible CP miles. Not to mention AC chose the arbitrary year of 1989 to start the count, rather than 1984 when AE started up. Every US program started the clock the day they introduced their FF programs.

    The steady erosion of elite benefits has continued year by year since AE/AC won the Best FF Program award at your first awards in Houston. That's why many of us around here use the catch phrase: "From first to worst!".

    As for selecting the program that is most appropriate, of course that makes sense. However, it only really does so in an environment where there are competitive programs. In the case of Canadians who fly primarily domestic, there is little or no choice given WS's anemic FF program and lack of any elite tier (and as such benefits). But those of us with a significant amount of transborder and overseas travel have indeed adopted your principle and dumped AC/AE in favour of UA/MP for the most part. I know at least a dozen such people who are now 1Ks and have let their SE status fizzle out. I moved over to UA/MP a few years ago to hedge my best and have maintained 1K or Plat status for each of those years, benefiting from a better redemption system with no "scam charges" on the same award flights that using AE miles would cost me hundreds of dollars. Not only that, but as a top tier elite with UA/MP (and AA) I don't pay outrageous change or redeposit fees. I have also rejuvenated my AA account and for two years have been ExecPlat, requalifying this morning for next year...my third as top tier. (So AC has lost my over 200K of flying this year, and a similar amount last year. I stopped at AC 75KElite last year, and my account this year shows 0 miles earned from flying, either base or EQMs.)

    I could go on further without even repeating my original "complaints" about AC and its FF program, or these new points. Too many of us on MP and FT are only too aware of this erosion, and thus the hypocrisy of our "national airline". I wish this were not the case. AC put me through university with summer jobs and a role as campus rep. I was among those who first bought shares in the airline when the government privatized it. I also bought shares in the new entity that emerged from bankruptcy a few years ago (and thus still have residual shares in Jazz and Aeroplan, both now rebranded as Chorus and Aimia respectively). Yes, I have a nice 777 model from the SMD3 reception put on by AC (and Starwood) but it is a model I paid for (MegoDos are not free) and it is a model I should have also earned by virtue of flying close to two million seat miles with AC and CP. (Okay, I've repeated a point from my original post, but in direct response to one of yours.)

    I'm sure Ben Smith and his crew will put on a great front for you all later in October, but I won't be there to witness the spectacle...the first SMD I've missed since they started, and the first in my own back yard.
     
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  10. I think people need to look beyond their personal issues and come to the understanding that AC is growing their premium pax and their SE numbers. That tells them they are on the right revenue track with their FF program and they test it very regularly with 3rd party polls and other means.
    They and most other *A carriers seem to be getting into sync for what I believe will eventually be much more seamless flying .
    My upgrades all clear now that I am a 2MM on my way to 3MM. The concierges all pay attention to my flights now and I am very well treated on board. That tells me my loyalty has paid off as my point of origin is YYZ the main hub for all of AC.
    The revenue based model they now seem to be following is how they will make money and reward FF'ers in the future and that's how any business should be managed.
    I liked the old way of getting freebies but in reality AC would not have survived had thye not changed.
     
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  11. boyzfly

    boyzfly Active Member

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    its a shame that Air Canada has made so many terrible marketing errors. I expect its next bankruptcy might solve the problems of bad management. Reality is the company is only running because the govt and Unions have let it continue by not paying its pension obligations. I guess the Union hopes the govt will bail out Air Canada, again, and the govt will pay some or all of the pension money.
    The new AC ff program is a joke and any customers who can or understand have long ago left. Today the program is a joke its for stranded customers in AC only cities, or those who have have unlimited expense accounts. Obviously flying AA or UA is a solution for many customers. For sure UA program is light years better than AC. Its a shame that AC 1MM status has now become useless, but anyone who thought otherwise was as fool.
     
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  12. RCyyz
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    RCyyz Silver Member

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    I think it's important to look at how AC has implemented their changes.

    As a Canadian, it's pretty much inevitable that you'll fly AC metal at some point. That's perfectly fine. But the point of a loyalty program is to incent people to want to fly AC more and correspondingly to spend more $$$ buying AC tickets.

    Yes, several other airlines have co-pay for upgrades. But to my (arguably limited) knowledge, no other major airline has co-pay on revenue fares. In addition, AC co-pay will not be a nominal amount. They will charge $500 per direction for co-pay. If you fly between Canada & Asia or Australia the co-pay is $750 per direction. Again, these one-way amounts are being charged on revenue fares.

    Another consideration is that upgrades are only available from eligible fares. This makes obvious sense until you actually look at what the eligible fares actually are. AC has 2 main buckets for Economy fares - Tango and Flex. Tango fares earn 25% or 50% status miles and that's about it. Flex earns 100% and is eligible for upgrades.

    In a recent (Sept 24) stealth move, AC re-classified several Flex fares to Tango. So on international travel there are now 5 eligible fare classes in Flex (M, U, H, Q, V). The difference in cost between even a V fare and a Tango fare is often quite significant. And let's not forget that upgrades are "subject to availability". So on an international fare, you could spent several hundred dollars extra to get a Flex fare, which gives you 100% mileage and the opportunity to maybe get an upgrade for which you then have to pay $500 or $750 one-way.

    It's also important to note that upgrades on AC are not done at time of booking (unless you buy full-fare economy and space is available). So you spend extra to buy the appropriate Flex fare, then a few days before you depart you put your name on the list and hope the upgrade clears. Then if it does, you pay quite a bit for a one-way upgrade. Then at your destination, you hope you're close to an internet connection at the appropriate time before your return journey to put your name on the list again and hope your upgrade clears so you can come home in comfort.

    The final point is to look at who is affected by these changes. The Vacation-Bound Infrequent Traveller will know nothing of this and care for it not at all. That's fine. So the only people affected by this are those pax who have status with AC. i.e. The very pax who travel more than average with AC are most affected by these changes.

    Most business travel is classified as "lowest logical airfare" so that means a greater percentage of business travel will be done on Tango fares now. Because Tango now only earns at most 50%, we'll see a slice of the business travellers lose their status. So that leaves people who travel a lot for their own purposes on their own dime. These are the one who will be faced with whether or not to purchase a Flex fare for the chance to spend a lot more if they are successful at upgrading.

    One really must question how any of this creates loyalty towards AC.
     
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  13. 1. The marketplace is suggesting that AC is now well managed. Look at how their share price is evolving and how many analysts are following the Company. Their pension issues are systemic for all large pension plans in Canada due to under performance of their investments in the market place. a booming stock market or major interest rate increase will resolve the pension deficit and the unions know this as well.
    2.I again repeat for the umpteenth time. The number of SE's continues to grow very nicely and so does the e50 and e75 numbers. Your issue is that you were led to believe probably through advertising that you could get unlimited upgrades and didn't read the fine print as its always there. As for 2MM status it is working for me as my wife has been given lifetime E50 status.
    Your comments about UA's program is patently false and indicates your true lack of knowledge on these programs. And, every time you buy a UA ticket ex Canada you are giving half the fare to AC as all cross border flights are pure code shares.
     
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  14. Canadi>n
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    Canadi>n Gold Member

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    In effect moving certain previously eligible for upgrade fare classes into Tango means the price threshold for upgradeable Flex fares (old Tango+) has gone up $250-$500 each way...and on top of that, there will be the upgrade surcharge of between the same amount. So it will now cost upwards of $2,500 more to upgrade on many Pacific routes than a similar upgradeable ticket would have cost a year ago. And of course, there is no guarantee of obtaining the upgrade given the AeroLotto situation, so you might end up paying an additional $1,000 for a ticket that never gets upgraded! The least AC could do is give the option of a refund on the fare difference between Tango and Flex if your upgrade doesn't go through and you don't want the 100% mileage a Flex fare gets over the 50% the Tango one does. This is a huge robbery on AC's part...holding out a faint promise of an upgrade which may never materialize but keeping the fare difference while you get the same economy seat as you'd have had with a Tango fare! Yet another example of AC's hypocrisy, or hutzpah!

    Yes, Guinessyyz, AC is indeed pruning the ranks and trying to make SE more attractive and exclusive. But to pretend that it cares about FFers by sponsoring a reception in Toronto next month for those same people it is pruning from the ranks still strikes me as sleazy, Randy. I wonder how many UA fliers who'll be at the SMD5 are aware that most of the fares the are likely to buy on their occasional AC flights will earn just 25% mileage (RDM and PQM) and no segment in MP? As well as reduced in LH's M&M to 50% for overseas AC flights and nothing for NAmerican flights in these classes. Maybe it's time for an ErrorPlan newsletter to be circulated during the MegaDo to warn of these fares.

    https://www.united.com/CMS/en-US/ma...s/Pages/AirlinePartnerDetails.aspx?ItemId=313
    http://www.miles-and-more.com/online/portal/mam/de/earn/flight/offer?nodeid=2508073&l=en&cid=18002
     
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  15. I am a director of a Canadian public Company and we force no one to fly Tango as they are way too restrictive and sometimes force employees to make the wrong decision based on the airfare being non refundableor the change fee being too expensive. So, we use a practical approach. Employees who are doing set travel are then encouraged to take the cheapest flights.

    I will also say that with AC's Z class fares to Asia we have allowed some employees to book with other carriers who have less onerous change fees for their discounted business class. AC is well aware of that and hopefully is going to react. If not they lose business. All that to say we are not in business to grant status to our employees but to be flexible and practical when it comes to Corporate travel.

    AC is after the high end business traveller who will pay more to fly and are evidently being successful at attracting them.
     
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  16. You yourself, a few years back, used to question how AC could have been so generous to FF'ers and still make money. Times have changed and you haven't. Its as simple as that.
    I loved the game back then but it has changed as have many other games in the industry. I have adapted as have many many others did and life goes on with AC. They have very full planes at higher fares and are making money. Your current favourite airline is still in bankruptcy protection and when they do come out of it and merge with USAIR I think you will see the profit motive come first. DL is there and poor old UA has not figured out how to get to that point.
     
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  17. Canadi>n
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    Canadi>n Gold Member

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    We all know that The Market pricing of a company's shares is often based on speculative and ignorant analysis, like the hype that drove Apple to 40% more than it's practical value, and our own Blackberry to similar unsustainable heights. AC's current pricing is a far cry from the $8 it initially went for during the first IPO and $10 when it came out of bankruptcy, and significantly lags behind WS which is a small airline and company. Not to mention, as we know, AC is bridled with a pension deficit that now exceeds $1 billion! That is not exclusively from the 2008 crash and low interest rates but a suspension of back payments that have occurred over the past five or six years.

    Not much asterisk'd small print in those full page SE100K ads to clarify the nature of upgrades, etc. And there hasn't been a single ad of late to appeal to lesser elites who don't have such generous corporate backers for their travel.

    And how's that? As I noted, there are no "scam charges" with MP awards on any airlines whereas there are plenty of AE awards. Plats and 1Ks can make any number of charges or cancel awards outright and not pay a single penny, right up to the day of flight, unlike AE which charges for every change (though generously will give SEs one change per year without a charge). Then there's the matter of NAmerican upgrades where there's a possibility of a free one irrespective of what fare is paid for all elites, but if not upgraded at least there's a few extra inches of leg room in E+, as there is on overseas UA flights. And for 1Ks and Plats, Regional Upgrade vouchers can be used to confirm upgrades at the time of booking, from any NAmerican fare, so no Aerolotto here. (I won't even go into the more generous benefits that AA offers its ExecPlats over UA's 1Ks, let alone over AC's SEs.)
     
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  18. Canadi>n
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    Canadi>n Gold Member

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    AA has actually made a significant profit in the past three quarters, in fact a helluva lot more $s than AC has yet seen. It will leave Chapter 11 protection once the Justice Department court case is settled, were it not for that the merger would have proceeded and take place next month. AA has resisted the Chapter 11 route after every other legacy carrier in NAmerica has been through it, some two or three times! Yes, things will change, but it will take an awful long time to get as bad as AC/AE elite has become.
     
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  19.  
  20. Time will tell but the industry is usually in sync.
     
  21. RCyyz
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    RCyyz Silver Member

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    Didn't quite follow that. Employees who are "encouraged to take the cheapest flight" would in fact take Tango.

    Anyhow in my world (financial services) my company, an NYSE-listed global multi-national, all travel is lowest logical airfare. All this means is that we don't force people to hop from X to Y to Z if X to Z is available and doesn't cost mountains more. But if the price difference is significant (use common sense here) then we will tell employees to go from X to Y to Z instead of taking a direct, non-stop. In either case, if flying AC the employee will be booked into Tango and not Flex. There was a time when my company simply did 100% of Canadian bookings on AC. Nowadays it's a mix of AC, WS and PD in Canada.

    My counterparts at institutions such as the Canadian banks tell me their travel policies are pretty much the same.

    Also, our senior executives are defined as those who have signing authority over $500K. These folks are permitted to travel in business class if the flight is over 6h. Otherwise they're at the back of the bus! Essentially this means that all North American travel is lowest logical economy which again in AC terms means Tango. For the European operations we don't go to the extent of flying people on Ryanair, but you can be assured that they are flying on pretty low fare buckets if they aren't taking the train. Asian operations all use the various lower-cost carriers as well; we don't have folks travelling CX or SQ to fly from the HKG office to SIN.

    The upper echelon of our company (C-suite) have access to the 3 corporate jets. Rank hath its privileges.
     
  22. We buy flex passes for NA travel both regional and NA wide. We buy both a flex and latitude pass for European travel and we fly all of our people to Asia in B or Z class depending on potential UG availability at the time of booking. the occasional flyer is usually some on going on a fixed timetable trip in NA and as such is encouraged to buy a Tango or low end WJA fare.
     
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  23. Another POV on the tier issues with AC. On boarding my flight this AM there were as many people in the priority line as there were in the regular one. That could explain some of the tightening we are seeing. Culling the herd so to speak
     
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  24. canucklehead
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    canucklehead Gold Member

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    That does not sound like a customer friendly policy at all. Instead of wholesale decisions on un-rewarding frequent fliers, the priority lines could be broken up into smaller groups (SE/J, 50/75K and then 25/35). AC is free to 'cull the herd' as you say, but I find it irrational to suggest that priority lines being too long as a good reason to reduce your client population.
     
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  25. slalom

    slalom Silver Member

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    I think that differentiated service is a good idea. As an "early recognition" 75K, I completely understand when an SE gets priority access to upgrades, standby seats, whatever, ahead of me and find it annoying when the priority line is all light blue 35K tags ahead of me (whether right or wrong, that's what I feel).

    Also easy for me to suggest as I believe I'll make SE next year so would be the beneficiary of differentiated service.
     
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