It’s true. American Airlines is following Delta and United down the dark path toward dynamic pricing of award flights. This was already rumored and expected by most back in April, but now essentially confirmed by American Airlines.
Given that I’m mostly at peace with Delta’s pricing (although nothing ever turns out to be a truly exceptional deal), the news about AA elicited little more than a sigh of frustration. C’est la vie. When United made their change, we knew the U.S.’s largest carrier would follow suit.
But then something else hit me that we could likely lose that would make this a very sour deal.
What will happen to reduced mileage awards?
This hit me like a ton of bricks. I’ve really liked being able to use the American Airlines reduced mileage awards as a Citi and Barclay cardholder at different times. On a total of four one-way tickets, this has saved us 15,000 miles. I’m sure many others who fly AA more often have saved much more.
The awards have also allowed us to choose more convenient airports at times. Santa Rosa airport, a small (but steadily growing) option north of San Francisco, generally has higher fares than other nearby options. But it makes the American Airlines reduced mileage award list regularly, while San Francisco International does not. Some regional airports that would otherwise be extremely expensive to fly into are great options when they are on the reduced mileage award chart.
However, the whole reduced mileage chart is based on their being SAAver award availability. If American Airlines goes the route of removing their chart entirely and eliminates the “SAAver” terminology, what will happen to these awards? There are a few reasonably foreseeable outcomes:
Percentage discount off of the award price
Currently, the reduced mileage award option lets you save 7,500 miles off a standard domestic round-trip SAAver award. You can book a one-way, in which case you would save 3,750 miles, which brings the cost to 8,750 miles each way. This is generally an excellent deal, and it is possible that American would just apply this to
But there is one hiccup: what if Denver to Los Angeles is pricing out at 6,000 miles one-way? Would American be willing to let this seat go for a mere 2,250 miles one-way? I think not. The amount of the discount could be changed, but this wouldn’t solve the problem of offering super cheap awards when you apply it to a fare that only costs 5,000 miles.
More likely, American would roll out a percentage discount, possibly keeping the 30% discount that the reduced mileage awards currently offer. This seems the most reasonable solution to the problem.
Do away with the awards entirely
This would hurt, but I wouldn’t be surprised to see this happen. The issue with this option is that it impacts the value of their co-branded credit cards, as this is a published benefit. For anyone who uses these awards often, losing them would hurt. It would certainly impact my decision to hang onto a co-branded credit card, as saving a substantial number of miles on these awards every year is completely worth the $95 annual fee.
Keep them. Somehow.
I mean, it’s certainly possible that American could move away from an official award chart while simultaneously keeping these awards for their co-branded cardholders. It just might become difficult to navigate, as you’d have to confirm that you are looking at MileSAAver space and you would need to check and see that the non-discounted fare isn’t actually a better deal.
It remains to be seen if and how American Airlines will change their reduced mileage awards. If nothing changes and they keep the current price, I’ll be ecstatic. But if they change the system, which is likely, I cannot imagine that the value will be as excellent as it is now. The pricing is based on MileSAAver awards, and if the MileSAAver distinction disappears, something has to change.
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