The Question for 2004: Should You Take Your Loyalty Elsewhere?

This was the year when the other shoe dropped on elite status programs, as most of you are only too aware. There were lots of changes made — in several cases airlines made it much harder to earn an elite card — and more changes could come in 2004.

The upshot is that you should start dealing with your elite status program the way you do your mutual fund portfolio: Once a year ask yourself if it’s giving you an adequate return on investment and compare it to the programs of competing carriers that serve the destinations you frequent.

If played carefully, having an elite card can still be an invaluable tool for both business and leisure travelers. Here’s a concise (and opinionated) overview of the various elite status programs that should help you answer the question... Should I take my loyalty elsewhere?

Air Canada: While the airline does offer elites some free domestic and international upgrades (some valid with lower fares, and some not), when you run out, you’re quickly back to paying full-fare with few other options. It’s hard to like a program that doesn’t allow you to upgrade with miles, isn’t liberal about offering miles for purchase, and doesn’t offer a domestic upgrade-purchase program for elites. Flying to the States, American and United’s elite upgrade program work better. Reconsider membership if you’re an infrequent or discount flyer.

America West: The best reason to throw in with this airline is that it routinely runs fare sales in First Class, for both US and Mexico travel — and often lower fares when there’s no specific sale. The big drawback to America West is that its route network is limited to the lower 48. That makes it more suited to residents of the airline’s hub cities, such as Las Vegas and Phoenix, who only fly domestically. Business travelers, flying on short-notice and/or without a Saturday-night stay, might also find some appeal with the self-proclaimed low-cost carrier, with its new transcontinental (New York & Boston to San Francisco & Los Angeles) service. Where domestic mileage upgrades were a plus at only 10,000 miles one-way, they have now increased to 15K. Award travel with partner British Airways, once a bargain, is no longer the case as BA’s Biz and First Class awards have skyrocketed (now in line with BA’s own new program).

[aside headline="The Golden Parachute" alignment="alignright" width="half" headline_size="default"]

Considering switching loyalty programs, but finding the thought of starting all over in a new program daunting?

Here’s the solution: Play the Match Game! Now’s the time to leverage your 2003 elite card into a new program for 2004 — by getting another carrier(s) to match your status for 2004, based on your 2003 credentials.

For details, see the website article originally published in First Class Flyer Aug. 1997 archived here: https://www.firstclassflyer.com/article.asp?aid=116

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American: If you’re an elite member, stay put. This is a solid program and it hasn’t had any major changes. American still allows you to upgrade with the lowest fares. Granted, it charges for the privilege ($40 per 500 miles), but that’s not necessarily a bad thing because that keeps more of the hoi polloi from trying to break into First Class. On international flights, the Executive Platinum Program offers eight free international upgrades annually, valid with any fare. Travelers on leisure fares earn full credit toward elite status — one of the biggest differentiators between elite programs these days. American has United beat in that mileage-upgrades are valid with ANY published fare — how can you not love that? The carrier’s extensive route network and the opportunities it provides (like the Gold or Platinum Challenge — see Golden Parachute at right) to get members to elite status quickly are also big pluses. With mileage purchase, gifting, and transfer options, you can see why I give this program a thumbs up.

Continental: Seriously consider bailing out as the OnePass program is deteriorating. The elite-mileage threshold stays the same for 2004 for travelers booking online. If you can’t book online, lower fares will earn only half the miles toward elite. (How would you like to be a biz traveler who has to book travel through a specific agency?) The fact that Continental is starting to charge a fee in conjunction with mileage-upgrades is disturbing. (Members traveling to or from Hawaii who purchase an H or K fare must pay a $200 nonrefundable service fee, in addition to the miles, in order to upgrade.) Among international mileage upgrade programs the carrier’s is the worst. What’s best about the changes for elites is bad news for non-elites: They can no longer use miles to upgrade on the lowest fares. Unless you live in Houston, Continental’s hub, you might reconsider: United and American would love your business.

Delta: If you’re a business traveler who has to go on a moment’s notice — meaning you pay full-fare, stand pat. Delta’s program is tailormade for you, with free upgrades flowing. If you’re a business traveler who has to find discount tickets or a leisure traveler, look for an alternative. It will take you a zillion miles to earn elite status, and should you manage it, the upgrade window for discount fares is so narrow that the chances are almost nil of getting upgraded. If you live in Atlanta though, you have to love the presence of AirTran because it has made Delta cut fares. You can fly to 40+ cities on Delta for under $600 in First Class — with no advance purchase or minimum stay! Just the other day I picked up a Delta flight SFO-Atlanta round-trip at $550, serviced by a B-763, fitted with Delta’s international Biz Elite seats (60 inches of legroom for an almost 4 and 1/2 hour domestic flight). If you’re flying routes on which AirTran competes, there’s no better place to be. (I’d be willing to forsake an elite program altogether to live in Atlanta.)

Northwest: Stay put, but keep an eye out. The program has only changed slightly for 2004 — namely the increase in domestic mileage upgrades to 15,000 miles each way — now the industry norm. Northwest didn’t give in to pressure from its partners, Delta and Continental, to slash benefits for the average traveler, but it might only be a matter of time before it does. It remains a good program domestically with many discounted First Class fares — for travel to Hawaii too. Also, the airline was and is the trailblazer with heavily discounted leisure Business Class fares to Europe (and occasionally Asia); and it is the only domestic carrier upgrading its international Biz Class seat product.

United: You’re going to benefit from United’s bankruptcy because it is going out of its way to keep every customer it has. So you’re safe for a while. Plus the Star Alliance continues to grow, meaning you have lots of options to earn miles and elite credit. More redemption options too. This program is especially good for those who only have bottom-tier elite status (25,000 flight miles annually) because it allows elite upgrades 48 hours prior to departure (most other programs are at 24 hours or less). That’s a boon when you’re flying on short notice. There’s no reason for United elites to jump ship, yet.

US Airways: Watch your back. The carrier tried to change its program last year in an attempt to go the way of Delta, by making elite a program for big spenders. It faced so much resistance from customers that it backed down. Its partnership with United and its fragile financial condition will probably make the carrier stay put for the time being. Unlike the Delta-Continental-Northwest alliance, the United partnership gives US Airways elites reciprocal upgrade privileges. Add the flexibility of upgrading domestically with low-cost domestic mileage upgrades at 10,000 miles each way with the lowest fares (the lowest of any domestic carrier), and you have the makings of a decent program.

For the occasional traveler to Europe, the program is terrific. While upgrades to Europe go for 30,000 miles each way with the lowest fares (the highest of any domestic carrier), the program more than makes up for that with its 10,000-mile upgrades valid with B and Y fares. Why? In many cases, a US Airways B fare is under $1,000 (compare with Delta’s upgradeable fares at $1,500+, requiring 50K miles), which is a great deal considering the round-trip upgrade is only 20K miles! Business travelers have a liberal domestic-upgrade window. Moreover, the top-tier program, the Chairman’s Club, is one of the best as it allows you to upgrade seven days prior to departure with the lowest fares (the norm is three to four at the higher levels).

How to Play the Alliances

Rule number one: Pledge allegiance to one of the three major alliances, Star (United & friends), Oneworld (American & friends), or the new DL-CO-NW. Splitting your travel between them just limits your chances of gaining elite status.

Rule two: Choose your alliance on the basis of which one specific airline loyalty program will do the most for you. For premium cabin travelers, an alliance is only as good as the primary carrier you came in on, as that program determines your perks and how you qualify.

Rule three: Do the domestic-international two-step. International carriers are increasingly seeking domestic partners that can feed their routes, and vice versa. You should use the same logic and go for elite status on a domestic carrier aligned with an international airline most suited to you. That way, all of your travel will pour into the same elite trough.

One Last Thought

Whether you switch elite programs or not, you might want to book some of your award travel for 2004 now as a hedge against any mileage-award increases.

Also consider buying the maximum miles you can through your mileage-purchase program before the end of the year, as most have annual limits. (You can buy another fistful in January.)

Here’s just a few awards that will increase as of Jan. 1, 2004:

• Northwest domestic upgrades: From 10,000 to 15,000 miles
• America West upgrades: From 10,000 to 15,000 miles
• Alaska domestic upgrades: From 5,000 to 10,000 miles

Consult your program’s website or program guide for the latest changes.