American AAdvantage Announces Long Feared Changes

Today, Tuesday 17 November, at around 2pm Eastern, American AAdvantage dealt an official blow to mile and point enthusiasts that earn their miles via flying. American also dealt a major blow to AAdvantage members that used those hard earned miles for premium cabin awards. Some of these changes had been rumored for weeks, but now they are fact. The news is not all bad, but, it mostly is.

Elite Status Changes

American is moving away from Elite Qualifying Points (EQPs). This isn’t unforeseen, in fact, EQPs probably made things more confusing. The new structure for Elite Qualifying Miles, however, rolls in the value of EQPs, that is, greater credit for more expensive airfares, here’s the breakdown:

• 3 EQMs/mile – Full-fare First or Business
• 2 EQMs/mile – Discount First or Business
• 1.5 EQMs/mile – Full-fare Main Cabin
• 1 EQM/mile – Discount Main Cabin

This maintain’s American’s focus on premium cabin flyers, and is consistent with the various promotions they ran this year. Of course, a strategy such as the one I used this year, pursuing Executive Platinum Status via Elite Qualifying Points, is still a very valid approach (I made my 100k EQPs back in July by the way, for anyone curious). American does note that the amount of EQMs earned on partner airlines will change, I highlight “will” because the current link still reflect Elite Qualifying Points.

Elite qualifying thresholds for miles remain unchanged, segments get harder. I don’t get this part, I tend to fly long haul international. I couldn’t imagine flying 120 segments to get Executive Platinum status, for example. It seems like a really painful way to do it, perhaps American should have gone the other way, just as a small consolation prize, like: “you’ve endured 90 segments of our domestic regional service, here, have a cookie and a stiff drink.” Just sayin’

Upgrades

Executive Platinum members minted by December 31, 2015 will get 8 Systemwide Upgrades (SWU). That same status only gets you half as many upgrades in 2016 – but there’s a (100,000 EQM) carrot – you can still earn up to 8 SWUs! Not sure that I’d be biting for that, but I suspect that SWUs will become more useful as fewer remain in the system.

Award Miles

Here’s the first punch of a combination. In the “Second half of 2016” (so perhaps 1 July? Not clear), American will move to revenue based earning. Here’s the damage:

• 5 miles/U.S. dollar – AAdvantage member
• 7 miles/U.S. dollar – Gold
• 8 miles/U.S. dollar – Platinum
• 11 miles/U.S. dollar – Executive Platinum

Gary has written about how I am not my fare, and what the breakeven spend to earn the same miles are. I won’t rehash this. However, the part I’m still trying to decide is, I’ve got a flight booked for 20% of the required EQMs to requalify in 2016. Do I go the rest of the 80% of the way in the beginning of the year, maximizing the miles earned? Well, that was my initial strategy, before the other half of that one-two-punch came.

Award Redemption Changes

These changes go into effect for bookings on or after March 22, 2016. In other words, if you have miles, book sooner than later, and you can book beyond March 22nd. The greatest value proposition for many of us mile and point enthusiasts, is when you can book an award on miles. For me, I particularly enjoy flying in the pointy end of the plane, the proverbial left turn, if you will. There’s nothing more satisfying, than settling into a first class seat for a long journey, knowing that all that manufactured spending and reselling made that seat possible. But that’s just me. Take a look at the changes and see whether you’re heavily impacted:

You’ll note, the changes for economy class awards are little to none. In fact, you can fly that 14 hour flight to the Middle East in economy for 5,000 fewer miles! How kind. There are even some token lower mileage costs to fly Business Class from the US to the Caribbean, Mexico, and Central America. Of course, it gets even worse when you look at long-haul travel. The First Class award chart is entirely painful. Some of it borders on “eye-popping.” Of course American didn’t go as far as United in some cases, for example, American only increased First Class to the Middle East to 115k (just under 1/3rd more), whereas United charges 140k for partner First Class to the Middle East.

Also, plan to pay more for 3 cabin flights in the US or Canada, 7,500 miles more for the premium cabin. I’m not sure I get that part. But I assume this is targeted squarely at American’s A321T Premium Service from JFK to LAX and SFO. Perhaps there will be other areas that will be hurt, but they probably are more the exception, rather than the rule.

Wrapping Up

Overall, I feel like I could live with the elite status changes, even earning award miles that way. The challenge I run into is the redemptions, I suppose most will feel this way. Of course, there are many ways to earn more miles via manufactured spending, reselling, and credit card sign-up bonuses. It is not as easy as it once was, it takes work, it takes reading through forums, but it can be done. My graver concern however, is the fate of the last remaining bastions of earning one mile for a mile flown. Alaska Airlines for example, is a very powerful program from a redemption standpoint, and they treat their members well, at least that’s what I hear from anyone who has status. For me, its time to look at some of the travel I’ve been meaning to plan, because I suspect that award space is going to get tighter and tighter as we get closer to 22 March.