The Extra Mile

More Changes Ahead for Frequent Flyers

Q&A: Airlines to Discontinue Mileage Programs?

September 21, 2002 - The fine print governing members' participation in airline frequent flyer programs says it clearly: all program policies are subject to change.

That caveat has never been more germane than it is today as the travel industry struggles to regain its financial footing in the wake of terrorism and a faltering economy. The airlines are scrambling to pump up revenues and pare down costs, and they have identified their mileage programs as potential sources for both.

In June, Continental and Northwest increased by 25 percent the number of miles required for their cheapest award tickets, from 20,000 to 25,000 miles.

More recently, US Airways announced that miles earned for flights on nonrefundable tickets would not count toward earning elite status. That policy, which drew widespread condemnation, was subsequently rescinded, at least partly because no other carriers followed US Airways' lead.

And two weeks ago, United weighed in with its own customer-unfriendly frequent flyer program change. Beginning in October, Mileage Plus members will pay more for upgrades, whether they're purchased for cash or miles.

The cash price of four 500-mile upgrades will rise from $125 to $200 for elite members of United's frequent flyer program, and from $200 to $325 for non-elites. Using miles, eight 500-mile upgrades will cost 50,000 miles, an increase of 20,000 miles.

Recognizing that airlines have the legal right to modify their programs, consumers have no choice but to make the best of a bad situation. Especially over the next few months when more such announcements are likely, members should monitor their mileage programs extra-diligently for news of impending changes.

While the airlines usually make a good-faith effort to advise members of upcoming revisions, cost-cutting has led to widespread cutbacks in frequent flyer communications. So the most reliable source for breaking news is the airlines' websites.

And taking a lesson from the US Airways policy flip-flop, be vocal. Negative customer feedback undoubtedly contributed to US Airways' decision to reverse course and leave their frequent flyers alone. At least for the time being.

Readers: Miles on their Minds

Question from Nancy

I'm curious to know if you have heard any rumor that airlines will discontinue travel award programs to cut costs...?

Answer

This rumor surfaces periodically, apparently reflecting consumer anxiety rather than real-world events.

While I would never say "never," I will say that it's highly unlikely that the airlines will shut down their frequent flyer programs in the foreseeable future. Although there are indeed costs associated with operating mileage programs, the larger programs actually generate a profit for the airlines which own them. And they're terrifically potent vehicles for gaining and retaining customers' loyalty and business.