United Airlines Copy/Paste Model
Earlier today, United announced that effective immediately, MileagePlus award miles won’t ever expire. This copies Delta’s and JetBlue’s mileage programs. Copying is something United has been doing for years when it comes to Delta’s model.
The more important, next step, will be towards Dynamic Award Pricing (DAP). DAP is something that Delta has already implemented. Many Delta Skymile members joking refer to Delta’s Skymiles as Skypesos as a result.
All airline program PR’s claim that DAP is a good thing for customers as it allows more availability to all members. It more or less, levels the playing field in terms of availability. But at what cost? Given the skyrocketing costs of even short-haul domestic awards between major markets like Chicago and New York, the paid ticket price may be $600+ but the award price now has no limit. I’m not looking forward to the days of outrageously high mileage redemptions.
Here is one example of United’s current award pricing with cash pricing beneath. Both options are meh. The 12.5K plus $80 close-in ticketing fee (this fee disappears when DAP gets implemented in Nov) and the 32.5K plus $80 close-in fee aren’t too appealing. I’d lean towards the 12.5K option and lose 5 hours in the process to save 20K miles. It would still yield $0.0268 per mile which isn’t too bad for an extra 5 hours.
The obvious, impending step for United’s Copy/Paste Model is to implement the DAP system which they already announced earlier this year will happen in mid-November 2019.
Most points and miles enthusiasts love mileage award charts over DAP systems because there’s a greater chance of achieving excellent value for redeemed miles. Sadly, United is the next US legacy airline carrier to adopt DAP, which leaves just Alaska’s Mileage Plan as the only US legacy airline that still uses fixed award charts.
Perhaps this is why we saw a first-time-ever, huge 75,000 mile signup bonus for the Chase United Airlines Business card earlier this year? Or even 60K or 70K mile signup bonuses for the Chase United Explorer personal card this year, too?
Flooding the market with miles then removing the expiration date to those miles only devalues them further for those individuals that are loyal to the airlines – business travelers. It will be interesting to see what these road warriors decide to do in light of this change and impending mileage devaluation.
Outside of Delta, no other US carrier comes close to meeting customer expectations for service or appreciation. Alaska may be an exception for certain markets? But no such exception exists for American Airlines or United Airlines.
While removing the expiration date from MileagePlus members’ accounts is a good sign, the writing is already on the wall for the next step with DAP loooming in a few months. Most MileagePlus members, especially the ones based in the US, have no problem extending the life of their miles.
Hopefully United will adopt the flash sales Delta has already implemented when United goes DAP in November. United has already given a couple flash award sales this year so it could be a good sign.
Regrettably, these sales only apply to economy award seats. The days of getting out-sized value on US airlines using US-based mileage programs for aspirational business or first-class travel may be dwindling in the next few months.
Thankfully, we still have Alaska…for now.
