We now have a picture of what the 2016 AAdvantage program is going to look like. Not ironically, it looks a lot like the programs of Delta and United, but not exactly like them. American’s managers were right to focus on getting US Airways and American onto the same reservations system before making any big frequent flier changes. Now, that the October 17 computer merger is behind them, they’re out with the new 2016 AAdvantage program.
This Happened More Quickly Than I Expected
I am not going to review the particulars of changes to the program or award charts as that has been done across the blogosphere since American’s press release yesterday, and in reality, for weeks prior. In all honesty, I half expected that the AAdvantage program as we know it might have remained in place through 2016, just based on getting the IT work done to support what they now propose. Instead, they’re moving forward with changes to elite qualifying miles for the new program year, and will award redeemable miles based on ticket spend later in 2016. In short, they’ve been working on what was introduced yesterday for more than a few weeks.
It’s Not All Bad
While moving to a revenue-based program is likely bad for a majority of members’ redeemable miles earning, it’s not all bad. Speaking about my own travels, which tend to be short-haul domestic, I am earning more miles under SkyMiles 2015 overall, than I was before. If I spent more of my time on longer haul flights, I doubt I’d be as cheerful. I expect a similar trend for my American flights. Further, American maintained something that I value greatly – its elite upgrade program.
The fallacy of “unlimited complimentary upgrades” leads to unlimited demand for a very limited product. It is not unusual at all for a Delta upgrade list to stretch to 60 or 70 names in premium markets. While American grants complimentary upgrades to its Executive Platinums, Platinums and Golds must “pay” for their upgrades with 500 mile upgrades that are either earned or purchased. Incidentally, I don’t find the new $40 price point for each purchased 500 miler to be that daunting. The result of such a system is that lower tier elites only request upgrades that matter to them, making the possibility of actually getting an upgrade for those members more likely. My upgrade success rate as an AAdvantage Gold member speaks to this.
Elimination of elite qualifying points is not an issue for me. I’ve only ever qualified by miles or segments anyway, and my Gold status is by virtue of AA’s million-miler program. If you are one who buys a lot of more expensive fares, you may find the new EQM structure advantageous.
Some far smarter than me have speculated that this will lead to a swelling of elite ranks. Personally, I think the jury is out on that unless the percentage of American’s customers buy full fare and even discount first/business tickets is larger than I believe it to be. Best (or worst) of all, there’s no minimum revenue requirement elite status. We’ll see how it goes.
The World Won’t End
The purists in (I can’t believe I’m about to say this) “the hobby” are going to be hurt by this change. That said, those same purists are likely earning the majority of their miles through methods other than flying. Alaska Mileage Plan is an option. If I lived on the west coast, Alaska would be my primary airline. However, I believe it’s wishful thinking to think that Mileage Plan accrual on AA flights won’t be negatively impacted by this. Further, Mileage Plan in its current form might live on for a year or three, but their competitive situation with Delta in Seattle will eventually arrive at some kind of equilibrium.
I’ve been through the internal discussion with myself about Mileage Plan and Delta a few times, and I might even think about it for American flights too. In the end, the answer always boils down to where I spend most of my time and that is on Delta and American airplanes so that is where I credit my flying. Although I know a case can be made for Mileage Plan depending on your travel patterns and ticket buying habits. If you’re flying on someone else’s dime, tend to buy last minute fares, and fly more short hauls than long hauls, you may find a move to a revenue-based AAdvantage program to be beneficial. It all depends on your specific travel profile.
-MJ, November 18, 2015