In the aftermath of the un-announced Alaska Airlines’ Emirates devaluation, Gary Leff posted: Your miles aren’t safe: Devaluations create the need for even more devaluations. While I don’t believe he’s wrong in his assertion normally, I will lay out an argument of why I don’t believe his assertion to be true in this case.
Background
In the past few years, we’ve seen the major US-based airlines’ frequent flyer programs devalue. Delta devalued their award chart, and eventually just went ahead and removed it. United followed suit and devalued their award chart. Then American released their much feared award chart changes. On average, premium cabin awards increased by 33-50%, in many cases, more. Finally, Alaska increased the cost of Emirates awards (but left all other award charts untouched–thankfully!).
Devaluations Beget Devaluations
The above order is in chronological order. Some may argue that Alaska really doesn’t belong, however I will argue quite the opposite. To that point, I’ll be focusing particularly on awards from the US to the Middle East. Every award will be looking at US to UAE.
Delta Airlines – Leveraging Wandering Aramean’s attempt at rebuilding the Delta SkyMiles chart, aptly called: “How many SkyMiles” the rates for business class are somewhere between 70,000 and 190,000 SkyMiles. There is no first class chart (perhaps because many of the core SkyMiles partners don’t fly First Class? Or maybe Delta is scared to venture into the 7 figure SkyMiles awards).
United Airlines – United breaks down their award chart based on United metal and Partner metal. Given United’s recent cutting of the DC-Dubai route, I’m going to make the assertion that you’ll need to fly on partner metal to get to Dubai. Given that assumption, you’re looking at 80,000 in business class, or 140,000 in first class.
American Airlines – American, thankfully, does not have two prices, depending on which metal you will be flying. This is good, considering American Airlines does not fly to the Middle East on their own metal. That said, their awards are, 70,000 in business class, and 115,000 in first class.
Alaska Airlines – Alaska, as I mentioned earlier, only devalued their Emirates redemption, so we’ll only focus on that here. To fly from the US to the UAE, it now costs 82,500 in business class, and 150,000 in first class.
Lets summarize that data, shall we:
As they say, a picture says a thousand words.
Analysis
After Alaska Airlines’ changes, business class is in parity. First class is a bit high, but, by my opinion, so is United. Ironic, that American, which probably has access to the best or at least second best first class products to the Middle East, requires the fewest miles for that impressive first class product. Overall though, I’d say that the above chart illustrates that Alaska was attempting to move from the lower end, to perhaps the higher end, but still is in parity.
The Elephant in the Room – Alaska Airlines Routing Rules
It is fair to say that the true value of the Alaska Airlines award on Emirates wasn’t to the Middle East. Rather it is to Asia, Europe, or Africa. While that is not the focus of this post, I’ll go ahead and say this – United is cheaper than Alaska’s new awards (by 50,000-60,000), despite United’s rather lax routing rules. American’s routing rules mean that the only way you get to Asia is if you fly direct, or pay for two awards, so not terribly relevant to the discussion. I never know what the answer is with Delta, so I’ll defer to you all, as I’m sure you, the reader, have more experience with Delta awards than I do.
Conclusion
I started this post off, making the assertion that in the case of Alaska Airlines’ devaluation of its Emirates awards, will not beget further devaluations. This is a risky assertion, given that an airline could prove me wrong with a few taps on the keyboard (or formerly, a few strokes of the pen). But I believe based on the evidence I’ve laid out, Alaska Airlines is merely moving into parity with the other airlines. Are some awards still better than others? Absolutely. I would argue that United and Alaska, while higher in cost, are better, because of their more lax routing rules. American, while lower in mileage cost, is less lax in their routing rules. Based on the new mileage costs, is there a clear winner? I would say, it depends, primarily, on where you want to go.
What do you think? Is Alaska the last to devalue in the previous string, or are they the first in a new string of devaluations?
Interesting post, but a couple of things.
1. My argument about devaluations leading to more devaluations wasn’t “monkey see, monkey do” one program does it then the next does too [although for the most part that seems to be true, indeed American clearly looked at other airline charts in building their post-March 22 chart].
2. I actually wrote the post before the Alaska devaluation of Emirates awards, my argument wasn’t about Alaska’s change.
3. You mention that Dubai necessarily means a partner award via United MileagePlus but that’s not actually correct. While you will fly on a partner to get there, as long as the longest segment of the trip there is on United metal it should price as a United award. And that’s still doable!
Cheers,
Gary
@Gary – Thanks for your comment!
1. I read your post as devaluations lead to more devaluations perhaps not a “monkey see, monkey do” approach (which I do imply in this post), but as you state, there is a cost to these programs. If United devalues and American doesn’t, that in theory makes United more cost efficient than American (from a program standpoint), leaving American at a disadvantage.
2. I amended my post just slightly, given this comment. I know you don’t specifically talk about Alaska’s change, but you’ll have to admit, the timing was, apt.
3. I did some spot checks last night, and again today with fresher eyes, and didn’t see any awards price out that way. This could be due to it not looking like United is releasing a whole lot of space on their metal. In fact, just looking to Frankfurt, I don’t see much space at all.
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