Last week I reported on the sad state of affairs of unredeemed (and hard-to-redeem) frequent-flier miles. And just when you thought it might be getting tougher to redeem miles, a number of airlines announced it's about to get even tougher than that.
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Each airline managed to use language that made the announcements appear to be valuable “enhancements” to their programs — enhancements to their bottom lines, perhaps, but not for consumers.
Let's start with the US Air announcement. I received an e-mail from their frequent-flier program that began: “As part of our continuing efforts to provide valuable benefits to our frequent fliers, US Airways is making a change to our Dividend Miles program … ”
See if you can find the value here: Starting May 1, passengers who fly trips of under 500 miles will no longer receive a 500-mile minimum credit, just the number of miles flown. And it gets worse. US Air also is assessing a $50 “quick ticketing fee” for “members who redeem miles for award travel within 14 days of departure on usairways.com.” And for those who might still be stuck in a time warp and want to talk to an actual human being and redeem miles, the airline will continue to charge $75 for having that conversation.
But wait, Northwest also has some “valuable” news for frequent fliers as well. Having difficulty redeeming your hard-earned miles? No problem. The airline now offers an option for combining your miles with cash to get tickets.
The airline offered some basic fare rates for full, purchased tickets, and then announced a new mileage/cash combination option for using your miles, if you're prepared to pony up some money at the same time. Some examples:
Minneapolis/St. Paul — Honolulu
February 25 – March 03
$339.90 plus 35,000 miles
Mpls/St. Paul — Cancun
February 25 – March 03
$220.95 and 35,000 miles
Mpls/St. Paul — Paris
May 12 – 19
$513.18 and 50,000 miles
Mpls/St. Paul — Tokyo
May 12 – 19
$709.38 and 60,000 miles
Detroit — Taipei
April 19 – 26
$579.68 and 60,000 miles
Detroit — London
June 2 – 16
$649.40 and 50,000 miles
Detroit — Seattle
July 9 - 13
$241.00 and 25,000 miles
This is being promoted as a great way for frequent fliers to “redeem” their miles. Really? It's not even close to being an efficient or economical approach. Time to do some serious math.
I picked two of the Northwest examples. First, their Minneapolis-Paris trip between May 12-19th, 2008. The straight airfare quoted by the airline was $917.
I went online to kayak.com and found Northwest flights on those exact dates available for straight purchase not for $917, but $663! And it only gets worse. Under their mileage/cash offer, the airline wanted $709 plus 60,000 miles! Now it's getting absurd. Under this offer, in real dollars, the ticket itself was $46 more than a straight purchase on kayak.com and the airline still wants you to part with 60,000 miles.
Remember, if 54 percent of all miles are earned on the ground (using affinity credit cards, where you get one mile per dollar spent), using the Northwest mileage/cash formula meant I'd spend $709 plus more than $30,000 in credit card purchases for a ticket I could have simply bought for $663.
Here's the second example: Northwest is offering Detroit to Seattle between July 9 and 13th. Northwest quoted the straight purchased ticket rate at $755, but a combined purchased ticket/mileage redemption would be $241 plus 25,000 miles. I found the same ticket available for straight purchase on kayak.com for $417 on Northwest (and as low as $362 on Frontier!). So how is $241 plus 25,000 miles a great deal?
Let's not forget the inducement to join the Northwest program — as with virtually every other airline frequent-flier program — was if you got to 25,000 miles, you earned a “free” ticket. In this case, it was a coach ticket between Detroit and Seattle.
This isn't just fuzzy math and creative writing (using the words “value” and “enhancement”) by the airlines. It's bad math and insulting language.
And last, but definitely not least, this Northwest offer was issued approximately a week before an impending announcement of a proposed merger between Northwest and Delta, which could easily trigger a wave of mergers and consolidations, a shrinking of seat capacity and flights and the continued devaluation of your hard-earned miles. So get ready: These are probably just the first in a number of offensive and/or misleading “value” and “enhancement” press releases.
In my last column I encouraged you to do everything possible to start drawing down your mileage balances as quickly as possible. But incurring $50 fees and combining mileage with cash is not the way to go. Plan as far ahead as possible now, because it appears as if the airlines are going to be changing the redemption rules quickly — and often — and none of the rule and mileage level changes appears to be in your favor.
Peter Greenberg is TODAY’s Travel editor. His column appears weekly on TODAYshow.com. Visit his Web site at PeterGreenberg.com.
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