Air Canada and partners (TD, CIBC and Visa) reached a deal with Aimia to buy Aeroplan for $450M cash and $1.9B in liabilities. Between the break-up and the recent announcement of buying out Aeroplan, millions of members have been in a tizzy, wondering about future of their account balances. So, what should Aeroplan members expect going forward?
First things first – Air Canada’s current agreement with Aimia for Aeroplan remains in place until June 29, 2020. Until then, business as usual – members can earn and burn under current conditions.
For members that have account balances past June 29th, 2020, Air Canada has confirmed that the miles won’t expire, they will follow them into the new loyalty program, Aeroplan 2.0, if you will. What we don’t know is if the value of miles in Aeroplan account will be the same in Air Canada’s new loyalty program.
Air Canada (and partners) have taken on $1.9B in unused miles with this deal, one way to shave some of the cost is to strategically devalue the points in the new loyalty program. Even slight tweaks to the redemption charts can yield large savings for Air Canada. I do expect some form of devaluation of Aeroplan miles going past June 2020.
Rumours and Gossip
A reliable source has confirmed that the new loyalty program will get rid of the pesky fuel surcharges that Aeroplan has been notorious for. The new program will align itself better with its US partners and competitors.
If true, this alone should make members do a victory dance – no scam charges on award redemption would be a perfect foil to any award chart devaluation. And that they want to align themselves better with US competition suggests that future award charts would be similar to that of United (star alliance partner).
Given that Air Canada partnered with TD, CIBC and Visa in the buyout, Amex’s future with Aeroplan looks bleak. Amex offers the best credit card bonuses in Canada and unfortunately, I do not see them with the new loyalty program. Since Air Canada’s new loyalty program does not have to compete with Aeroplan for members, credit card bonuses may continue to be average, at best.
Last but not least, if the buyout goes through as expected, the recent partnerships Aeroplan announced (with Porter, Air Transat and Flair) will most definitely fall through as Air Canada would prefer to align itself with Star Alliance partners only.
Under the new program, there will be devaluation to some degree, and members should still try and use their account balances before June 2020. If rumours about no fuel surcharges are true, that would be HUGE improvement and should make any potential devaluations easy to gulp down. This saga is far from over.