The old saying, “Change is the only constant” seems to have been invented to describe frequent flyer programs. While airlines like to refer to these changes as program “enhancements” the reality is that very few of their changes are beneficial to consumers. While I’m a dedicated AA flyer (Executive Platinum who has nearly requalified before mid-year) I’m disappointed to report that AA is following the path of program devaluation blazed by Delta and United. Here’s a quick summary of the upcoming changes, some of which were just announced. At the end I’ll talk strategy.
Upcoming changes to the AAdvantage program
Changes to how miles are earned
This had been announced previously, but it’s still painful. Currently travelers earn AA miles based on the distance of the flight taken (with some exceptions and bonuses for very short flights or paid premium cabin tickets). Effective August 1, we will earn AA flight miles based on the cost of the ticket (excluding taxes).
Like I said: painful. Even an Executive Platinum like me will get hosed on long flights that are even reasonably priced. As an example, a flight from Portland to Philadelphia currently yields me 4,812 base miles and 4,812 bonus miles (because of my elite status) for a total of 9,624 miles. In order to earn this same amount of miles after August 1, I’d need to purchase a fare of $875.
For non-elite members it’s even worse: the 4,812 miles you’d earn today on this roundtrip turn into just 1,500 on a $300 fare. Ouch.
New elite level: Platinum Pro
AA is adding a new elite level called “Platinum Pro” – a goofy name but in line with having four elite levels like Delta and United. This will be a gain for those who earn more 75K qualifying miles each year but don’t quite make it to Executive Platinum.
Spending requirements for elite status
Again AA is following the path set by Delta and United. Starting in 2017 (for the 2018 membership year) there will be minimum spending requirements to achieve and maintain elite status (unless you have lifetime status). Here’s a quick reference guide:
Gold: 25,000 qualifying miles and $3,000 in spending
Platinum: 50,000 qualifying miles and $6,000 in spending
Platinum Pro: 75,000 qualifying miles and $9,000 in spending
Executive Platinum: 100,000 qualifying miles and $12,000 in spending
I don’t care about this so much as long as it weeds out some lower spending Executive Platinums. They need to do something to thin out the ranks a bit and make it truly “elite” again.
Changes to upgrades
Finally, AA announced that there will be changes to “upgrade windows and prioritization,” namely:
- Upgrade priority will be based on a 12-month rolling EQD total, sorted by elite status level.
This means that if there are two Platinums tied for an upgrade, the winner will be the one who has spent more with AA during the previous 12 months. Fair enough.
- Executive Platinum and Concierge Key members will be able to use their complimentary upgrade benefits on award tickets in the 500-mile upgrade markets.
This is great for Exec Plats – upgrades on award tickets – woo!
Frequent flyer strategy moving forward
Considering this is coming just a few months after AA increased the mileage price of many award tickets – some drastically – the direction we’re headed is clear: slow, continual devaluation of loyalty programs. Thanks to industry consolidation (and therefore lack of real competition) and strong demand for flights, the big carriers think they can get away with making whatever changes they see fit. And for now they can, but eventually the pendulum will swing back – during the next recession when demand drops, most likely.
With AA making these changes there is just about nowhere left to turn among U.S. carriers, except the Alaska Airlines Mileage Plan, which retains a more traditional frequent flyer structure. But Alaska will also be undergoing significant change as it attempts to
digest integrate Virgin America, so it’s hard to predict how its program will fare.
The bottom line: We’re earning less miles and paying more for award tickets. This is the new normal for now, so stay sharp looking for ways to boost your mileage earning to compensate.