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Sometimes I can’t catch a break – I take two days out to do something other than watching what the various loyalty programs, airlines and hotel chains are doing and then Marriott goes and buys Starwood and American Airlines announces an enormous award chart devaluation. That last one was the worst because the announcement came while I was at 34,000ft somewhere over Europe (and without WiFi access) and I only saw the news when I landed back at Heathrow (very late at night). Airlines really don’t consider miles & points bloggers when they release their news! 🙂
Anyway, numerous other miles & points blogs seem to have already gone over the overall changes to the AAdvantage program but I thought I’d take a look at how the award chart devaluation will specifically affect European members of the AAdvantage program – it isn’t pretty.
There are two types of award chart that American Airlines uses; one for travel on American Airlines aircraft and the other is for travel on partner airlines. Both sets of award charts have taken a hammering.
The changes to the American Airlines award charts will be effective for bookings on or after 22 March 2016.
For the purposes of this exercise I’m going to concentrate on the MilesSAAver Awards as those are the ones that most people look to book – the post would become way too cumbersome if I was to try to discuss the AAnytime awards as well.
Awards For Travel On American Airlines
Economy Class Awards (click to enlarge):
While it’s true to say that, most of the time, economy class awards have not been the best use of American Airlines AAdvantage miles, there were occasions when good value could be had. Not any more.
The biggest hit comes from the fact that Off-Peak Awards (for travel to/from Europe between 15 October and 15 May) are no longer going to be available for travel to anywhere other than the contiguous 48 US states. And nowhere is that hit more obvious than for travel to Hawaii.
Using the old off-peak MilesSAAver awards, 40,000 AAdvantage miles for a round trip ticket from Europe to Hawaii could be great value for money when ticket prices are in excess of $1,400 (as they often are) and I’ve made use of this award on a number of occasions myself.
Add to that the fact that the cheapest economy class round trip awards now cost 80,000 AAdvantage Miles (a 100% increase) and we’re left with a situation in which economy class awards between Europe and Hawaii are more or less pointless (no pun intended).
The loss of the off-peak awards to other locations is bad too but it’s with the awards to Hawaii that the hit is worst.
As far as the regular Economy Class MilesSAAver awards go, the increase to Hawaii is once again the stand out devaluation, but the small increases to economy awards to other locations aren’t too bad. But, then again, they’re still almost always going to be poor value.
Business Class Awards
Business Class awards were never eligible for off-peak MilesSAAver awards so that’s one thing those in charge of the AAdvantage program couldn’t devalue. However that didn’t stop them from taking a bash at the rest of the Business Class awards on offer.
The 15% increase in Business Class awards to the contiguous 48 U.S states is probably as low an increase as we could have hoped for – if you’re looking for a bright spot in this series of devaluations this may be it.
Because American Airlines uses a region-based award chart it has always meant that you could find trips of vastly differing distances that cost the same number of AAdvantage miles (e.g. LHR-LAX-LHR vs LHR-JFK-LHR)…. but now American has gone one further:
Suddenly it costs more AAdvantage miles to fly from Europe to Toronto than it does to fly from Europe to Los Angeles despite the fact that Toronto is a lot closer than LA. For anyone struggling with the logic of American’s old award charts this one is going to be hard to understand 🙂
Once again it’s the Europe-Hawaii route that sees the biggest hit with an incredible 40% increase in the number of AAdvantage miles needed for a Business Class award.
First Class Awards
Ironically while it’s the First Class awards which have seen the biggest increases in miles required, they are also the awards that probably matter the least.
American Airlines is slowly doing away with its international First Class cabins as it introduces new Boeing 787 Dreamliners without First Class and as it removes First Class from its refurbished 777-200 aircraft. The only aircraft that will keep international First Class are the 777-300s flying ultra-premium routes like LHR-JFK and LHR-LAX.
Besides all of that, the bigger question would have to be why anyone would choose to spend miles on American Airlines First Class when there are so many better options out there.
Awards For Travel On Partner Airlines
Economy Class Awards (click to enlarge)
The changes to the Economy Class award chart on partner airlines is where the most variance is to be seen:
On the one hand American Airlines have once again done away with off-peak awards on travel to anywhere but the 48 contiguous states (awards to Hawaii are again hit hardest) but they’ve given a little bit back by reducing the numbers of miles needed for travel to Central America and South America Region 1.
The changes are still very much weighted towards the negative and how American Airlines can justify a 33% increase in the number of miles needed to fly to Hawaii or the South Pacific (which for most people means Australia) is beyond me.
On the whole, Economy Class awards on partner airlines have always been even worse value than Economy Class awards on American’s own aircraft – mostly due to the surcharges that partners like British Airways add to award tickets. These changes to the award chart do nothing but exacerbate that fact.
Business Class Awards
This is where the real damage has been done and it’s here where we find most of the great value awards devalued to a very significant degree.
The first thing to note is that the 15% increase in Business Class awards to the 48 contiguous US states is the least damaging of the changes – it just mirrors the increase in miles needed to fly on American Airlines’ own aircraft. It’s unwelcome news but by no means the worst news to come out in this devaluation.
American have continued their assault on award redemptions to Hawaii by implementing a 40% increase in the number of miles needed for a Business Class ticket but, in the case of partner awards, this doesn’t make much difference as most people would be flying to Hawaii on American Airlines and not a partner airline anyway.
The award changes that will hurt the most will be:
41.7% increase in the number of miles needed to fly to the Middle East/Indian subcontinent
In the past, passengers could book round trip Business Class travel, between Europe and destinations like the Maldives and the UAE for just 60,000 miles – and that would be flying in one of the most celebrated Business Class cabins around – with Etihad. Now the cost for the same trip has rocketed up to 85,000 AAdvantage Miles.
41.7% increase in the number of miles needed to fly to the South Pacific
Just as Qatar Airways expands its offering to Australia, American Airlines inflates the number of miles you need to get from Europe to Australia with any degree of comfort. A round trip Business Class redemption increases from 120,000 AAdvantage miles to an eye-watering 170,000 miles.
42.9% increase in the number of miles needed to fly to Asia
From an AAdvantage member’s point of view, Cathay Pacific is one of American Airlines’ most valued partners because of the great Business and First Class cabins they offer. Seeing a round trip Business Class redemption increase from 105,000 AAdvantage miles to 150,000 AAdvantage miles really hurts!
First Class Awards
The damage done to First Class awards on partner airlines mirrors that done to the Business Class awards discussed above.
All the increases in the miles needed for First Class awards are pretty horrendous..it’s just some are more horrendous than others.
The increase in the miles needed for flights to the US isn’t that much of a blow because most of those awards would be on British Airways. I can think of any number of better uses for miles other than BA First Class (especially if you add in the horrendous surcharges).
On the other hand:
The 56.3% increase in miles needed for a First Class redemption between Europe and the Middle East/Indian Subcontinent is a hammer blow to anyone wanting to book Etihad’s First Class cabin and, at 230,000 AAdvantage miles for a round trip First Class award to Australia on Qatar Airways, that award just became a whole lot harder to achieve.
Other Changes
As you will have noticed, American Airlines divides the world into regions for the purposes of its award chart and American Airlines hasn’t just changed the number of miles needed to travel between various regions, they’ve also made a few subtle changes to which countries appear in which regions:
Venezuela moves from South America Region 1 to South America Region 2
Net effect (compared to what would have happened had the region change not occurred):
- Economy Class awards cost 10,000 miles more
- Business Class awards cost 20,000 miles more
- First Class awards cost 20,000 miles more
These increases are on top of the increases as a result of the devaluation in the AAdvantage award chart.
Bolivia moves out of South America Region 2 to South America Region 1
Net effect:
- Economy Class awards cost 10,000 miles less
- Business Class awards cost 20,000 miles less
- First Class awards cost 20,000 miles less
Manaus (Brazil) is separated out of the rest of Brazil (in South America Region 2) and moves to South America Region 1.
Net effect:
- Economy Class awards cost 10,000 miles less
- Business Class awards cost 20,000 miles less
- First Class awards cost 20,000 miles less
Guam moves from Asia Region 2 to South Pacific
Net effect:
- Economy Class awards cost 25,000 miles more
- Business Class awards cost 10,000 miles more
- First Class awards cost 25,000 miles more
Sri Lanka moves from Asia Region 2 to Middle East/Indian Subcontinent
- Economy Class awards cost 15,000 miles less
- Business Class awards cost 32,500 miles less
- First Class awards cost 27,500 miles less
On the whole the region changes appear to benefit travelers more than they hurt them…although you’re not likely to take much solace from that if you were planning on using AAdvantage Miles for a ticket to Guam or Venezuela.
Overall
I could have used any number of words to describe just how bad these devaluations are but most of them would have been in very poor taste considering the truly horrific news we’ve seen coming out of France in the past week – that really puts things in perspective.
Still, these devaluations are very, very bad indeed and there’s no amount of sugar coating that American Airlines can do to mask just how badly they’ve crippled the AAdvantage program.
To bring a little bit of balance to the argument, I should point out that AAdvantage Miles are still a lot more useful than Avios as you still need a lot fewer of them to book awards….but then Avios ceased to be any use for long-haul awards after they suffered their own devaluation earlier this year.
These devaluations in the American Airlines award charts need to be taken in context alongside the other changes to the AAdvantage program that have been announced – and that just makes them even worse (and you thought that wasn’t possible!). I’ll be putting together a separate post on just how much harder it will be for European flyers to earn AAdvantage miles starting from late 2016 and that will really show just how bad these devaluations are (Update: American Airlines AAdvantage Changes – Effect on Redeemable Miles)
When you put together the astronomic increases in the number of miles needed for awards (40%+ increase in a lot of cases) and the fact that American Airlines AAdvantage miles are going to be a lot harder to earn going forward, you get a picture of an AAdvantage program that really isn’t that rewarding anymore.
And that begs the question: Is it time to forget loyalty programs altogether and just focus on price and product alone? I think a lot of people will probably answer “yes” to that question and that will end up being bad news for American Airlines in the long run.
In my opinion they’ve just killed the goose that laid the golden egg.
