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American Express Airline Credits – Where Are We Now?
Over the past few years data points would crop up of gift card purchases not triggering the annual airline credit offered on a variety of American Express cards, only to quickly be reconfirmed as working. It would appear now that those days are over. Ranging from $100-250 annually, these credits have always been a great way to get a few extra bucks for travel. To me this was always a “when” as opposed to an “if,” – so with the gift card loophole closed, what options still exist for using these credits?
The intention of these credits has never been to be used to purchase airfare, yet there data points that suggest airfare under $100 from Southwest and Jet Blue has triggered the credit. It doesn’t seem like this is a 100% guarantee, but is an option worth exploring. Also, airfare from Delta purchased partially with Delta gift cards appears to trigger the credit. The thought here is that the coding of the purchase comes through slightly differently than a normal ticket and thus Amex picks it up as non-ticket spend.
More in line with the benefit design, the following items are reported to still be working:
- Baggage Fees
- Ticket Change and Cancellation Fees
- Phone Reservation Fees
- Seat Selection Fees
- On-board Food and Beverages
- Pet Fees
- Lounge Passes and Memberships
- Southwest’s “Early Bird” Check-In
- TSA Security Fees UP TO $5.60 (data points suggest award tickets with segment fees above $5.60 are not triggering)
- United On-board WiFi (other carriers’ wifi is billed from the provider, not the airline)
For some card members these changes could be the difference between keeping and dumping a card. This will vary from person to person, but to me, these credits were effectively as good as cash. Now, I find myself in a position of seeing how best to use these credits with a designated airline without changing habits too much. It is worth the time to look at how the credits can work for you and if the value still remains on these cards.
American Express to Stop Allowing Points Earning on 3rd Party Gift Cards?
Right now, file this one solidly in the “maybe” column. It has always been bad news to try and hit a sign-up bonus on an Amex card by buying gift cards as they have expressly forbidden this, but it has more or less been open season on regular purchases (Simon Malls excluded). The language below has been on several cards for over a year and has crept onto a few more in recent months :
“Eligible purchases are purchases for goods and services minus returns and other credits. Eligible purchases do NOT include fees or interest charges, balance transfers, cash advances, purchases of travelers checks, purchases or reloading of prepaid cards, purchases of gift cards, person-to-person payments, or purchases of other cash equivalents.“
Knowing this, how should you act? On the one end of the spectrum, this language has been around for a while and Amex hasn’t taken action across the board. My view is that this isn’t targeting the casual purchaser of gift cards, but the true manufactured spender. This language allows Amex to deny points and even trigger financial reviews and other account limiting maneuvers. Depending on how risk tolerant you are, you may decide to move gift card spending to another card or continue as is. For now, this is something to watch and it would also be prudent to take a peek at those statements and see if gift card purchases are still tracking for you.
American Airlines Updates – Award Bookings, Fees, Legal Disputes and More!
Some good news regarding AA awards – JAL award tickets can now be searched and booked on AA.com, becoming the 16th partner for AA currently bookable via the website. As of now only economy, business, and first class show up, with premium economy not being bookable.
On the flip side, AA flights are again showing up on Iberia Plus. This is great news as it opens up some sweet spots where using Avios (distance based chart) is typically more favorable than the AA zone based (soon to be dynamic) chart. Unlike British Airways Avios, which are charged per segment, Iberia Plus Avios can be used on connecting itineraries, increasing their value over their UK brother.
A couple months back Citi added 48 month language to some application links for American co-branded cards, while other remained at 24. It appears now that Citi has changed all of its applications for AA cards to 48 month restrictions. This may change one’s strategy going forward, so be sure to read the fine print on those applications.
AA has been fighting for months with its mechanics union and while there doesn’t seem to be an end in sight, American did recently win some additions to their restraining order against the union. The restraining order essentially relates to behavior from the union meant to delay flights for mechanical reasons. The courts stepped in and listed out what the union was allowed and not allowed to do in regards to AA’s requests. In short, this is a temporary win for AA customers hoping for limited mechanical delays on flights.
It appears that close-in booking fees will be disappearing from American’s award booking system in the near future. As with most award terms changes there is good and bad. The good news is pretty obvious – lower fees. The bad news is a bit hazier – American is shifting to a dynamic award chart, so while they may be dropping a $75 fee for booking within 21 days of departure, they could jack up the price of the ticket by 20k points in that time frame. This would not at all surprise me and would give award bookers fewer low cost options. While it isn’t set in stone, it certainly is a move away from transparency.
Air France’s Plans for a Post A380 World
Air France announced last month that they will be retiring all of their A380s by 2022. This comes as no surprise as the plane will be ending production in 2021 and with the advent of more efficient plane and engine designs, the behemoth has fewer and fewer profitable routes left. The A350 and 787s have opened up smaller cities for profitable direct routes, limiting the need for a major hub and spoke system. This is not unique to Air France, but they have been one of the few to succinctly lay our\t their plans for the next few years.
They are currently looking at both Airbus and Boeing to order as many as nine A330-900, A350-900 or 787-9 aircraft to replace the A380s. Air France is also replacing its A318s and A319s with the new A220-300. The airline is looking to streamline operations by both lowering fuel burn per seat and standardizing fleet products and configurations. Seeing as how the airline already has 787s in its fleet and about 30 A350s on order, it would seem the airline would go that route over new A330-900s (for the sake of standardization).
It is interesting insight into the future of air travel and a world without the super-jumbos transporting passengers. While I am sad to see the A380 (and 747) go, having flown in some of the newer generation aircraft I am happy to say they offer a higher level of comfort and do so with less negative environmental impact.
Minor Changes That Make Large Impacts
Several interesting tidbits caught my eye this past month look to elevate/differentiate brands in the world of travel. First, Dubai International Airport has opened a new lounge that is exclusively for children traveling as unaccompanied minors. As I read this, (and admittedly, I had never thought of it) I was shocked that it hadn’t been done before. It is such a great idea to provide a safe place that can entertain children on layovers and take some of the anxiety out of flying alone at such a young age.
While not nearly as meaningful of a change, it is still noteworthy that Delta is finishing up its fine tuning of changes to its international economy food and beverage service. They will soon start providing hot towels, beverages from a tray, premium appetizers, more choices, and other small touches such as post-meal chocolates. This doesn’t take the economy experience to a level on-par with business class (or even premium economy), but does elevate it to a point where as a passenger you will notice and appreciate the little bit of extra care. It will be interesting to see if and how other US carriers respond.
As of the end of July, IHG has fully eliminated miniature bath amenities at its properties around the world. According to the CEO, they currently place around 200 million units at their hotels each year. That is an incredible number and by stopping this practice they will be eliminating a lot of waste and fulfilling a portion of their company-wide green initiative. This of course means that we can expect to find bulk amenities going forward at IHG properties. A lot of folks don’t like that idea, but when the hotels take care to make sure that a) they are filled, b) they don’t have gunked up dispensers, and c) they are presented in a classy and clean way I am all for it.
United and CLEAR Announce Partnership
First, what is CLEAR? CLEAR is a service that saves time by allowing you to bypass the first step of the TSA process, the ID check. You scan your fingerprints and are immediately escorted past the TSA ID checker. At larger, busier airports this can save a lot of time, especially for a frequent traveler.
The service normally costs $179 each year, but for United MileagePlus members the pricing is as follows:
- Global Services and Premier 1K members will receive a CLEAR membership free of charge
- Premier Platinum, Gold, and Silver members, as well as most United credit card members, will receive a discounted membership rate of $109
- All other MileagePlus members can purchase membership for $119
Delta also has a partnership with CLEAR and the pricing seen here closely reflects that of Delta. Overall, this is a great development – especially for United elites at a busy hub airport.
Another Data Breach – This Time Capital One
I feel like we are all so numb to data breaches – at this point is there ANYONE that hasn’t had data affected? I guess the answer is yes if you have never had credit, don’t have a social security number, have never shopped at Wal-Mart, Target, Home Depot, Lowes, eBay, Adobe, Marriott, or don’t use Facebook, Yahoo….you get the point. The latest major breach hit Capital One to the tune of 100 million US customers and about 6 million Canadian customers. While data that was accessed varied by person, Capital One, like so many others is offering free credit monitoring. Updates on the situation can be found here: https://www.capitalone.com/facts2019/
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