United adds revenue requirements to elite qualification starting in 2014

Earlier this year Delta announced that they’d be adding a revenue component to qualifying for SkyMiles status, whereby you basically had to spend an average of 10 cents per mile to qualify for status ($2,500 for Silver, $5,000 for Gold, $7,500 for Platinum, and $12,500 for Diamond), in addition to the traditional miles needed. That being said, spending $25,000 per year on a co-branded Delta American Express card waived the revenue requirement, even for the upper tiers.

Well, it appears as if United likes the idea, as they’ll be introducing a very similar revenue requirement for 2014 elite status requalification.

The thresholds are the same at an average of 10 cents per mile, and only the following spend is eligible towards the minimum spend requirements:

  • Base fare and carrier-imposed surcharges
  • Flights flown by United, United Express, or Copa Airlines
  • Flights operated by a Star Alliance or a MileagePlus partner airline and issued on a United ticket (ticket number starting with 016)
  • Economy Plus purchases

Like Delta, you can waive the revenue requirement by spending $25,000 on a United Chase co-branded credit card, though only for Premier Silver, Premier Gold, and Premier Platinum — there’s no waiver for Premier 1K. That being said, those with addresses on their MileagePlus accounts outside of the US are exempt from this change (which just seems to be making it too easy?).

Truth be told I think we all saw this coming eventually, though I know I didn’t see it coming this fast. When Delta introduced the revenue requirement I didn’t actually think it would immediately lead to American or United following. After all, Delta kind of seems to operate in their own little world. But I guess it did, as United’s policy is almost identical, and I’m sure American won’t be far behind. While it could be that American follows with a similar announcement in a week, I’m leaning towards them just having a similar policy when they introduce a new mileage program for the combined carrier.

Do I like changes like this? Of course not. But I do see why the airlines make them. This game is getting tougher! Or more accurately, they don’t want there to be a “game.”

Will this change impact your elite status qualification, and when do you think American will follow?

Comments

  1. My prediction: newAA will make status gualification based on EQP, not EQM. 😉

    This basically does what UA and DL will do, with very little change to their existing system. “Hey, want to be an EXP on cheap fares? Fly 200,000 miles of them!”

  2. I’d actually prefer an alternative, revenue-only qualification. So maybe if you spend $15k you qualify for 1K without the miles.

  3. How will they attach the PDQ to the passenger? For example, if my company pays $8K for a business class ticket for me to fly will that count as “my spending”? I don’t fly UA but still do not understand how Delta will attach my company spending for me to fly to my Delta account.

  4. Not really surprising. I wonder if there are significant numbers of members at each tier level who wouldn’t have met the spend requirement. If you are pure mile runner, maybe, but if do any material amount of work travel or inflexible-date travel, chances are that you are spending close to the required amounts.

    I do hope that the website will include a tool to monitor progress on the dollar requirement.

    To the extent that this hits people who are mainly milerunners, it is kind of a hit at the Flyertalk & Milepoint communities, but maybe from UA’s perspective they don’t mind culling the folks skilled at hacking the travel programs

    If I were AA, I would not immediately match this. Sit back, hope the merger goes smoothly (or let the glitches pass), maybe attract some switchers, then impose the dollar requirements in 2015 or 2016

  5. @Santastico it’s credited the same way that miles earned are by the passenger flying not the passenger buying. So if you earn the Medallion Qualifying Miles in your account you’ll also earn the spend.

  6. Does that mean lot of mileage runners for the program?

    After the PQD, upgrades for 1K should be much easier?

  7. @Santastico: Easy. For any flight credited to your frequent flier account, the eligible revenue from that flight will apply to the dollar total. They don’t care who the money came from (it’s all green to them), just what your net value to them is.

  8. All I can say is manufactured spend is getting more and more important. Thankfully, Delta is allowing the revenue credit card spend exception on top tier status. My goodness, did I just say something nice about Delta?

  9. I’ve sometimes hit Gold status without spending $5K (and without mileage runs! I’ve never done one in my life). So this change will be a pain in the butt for this particular over-entitled elite. Also, this change reduces my flexibility in two ways:

    1) If I want to hit the spending threshold, I have to buy tickets from United and can’t buy them from partners. But UA’s code-share flights on other carriers’ metal are often far more expensive than just buying the tickets from the other carrier.

    2) If, instead of buying tickets, I decide to spend $25K on a UA Chase card, then I can buy the tickets however I like – but then I can’t switch most of my spending to the Chase Sapphire Preferred card, which I love because of the numerous options for using the points.

  10. The part I don’t like but understand is the fact that *A tickets that are not UA issued don’t count towards the minimum spend. That makes it a pain in the butt to book some flights that are *A but don’t involve the US at all. I just did a quick search for a BKK – KUL rt and hey, united.com returns nothing and asks me to call them. If I call, I don’t exactly anticipate them being able to sell me a 016 ticket for that flight, most likely operated by TG.

  11. United the Credit Card Company strikes again. This is worse than Delta though as there is no waiver for 1k.

    Oh well, now the question is when does the “new” American join the crowd.

  12. Check out the FAQs for this caveat:
    For 2014, the Premier qualifying dollars (PQD) requirement is waived for existing Presidential Plus Cardmembers for Premier Silver, Premier Gold, and Premier Platinum qualification. There is no PQD waiver for Premier 1K qualification. For 2014, we will continue to waive the four segment minimum for Presidential Plus and MileagePlus Club Card Cardmembers as long as their card account is open and not in default at the time of qualification.

    I have the Presidential Plus card (thankfully) – however, I don’t think it’s available for new applicants

  13. By the way, this will also eliminate any chance that my kid will get status. This year she’s Silver because of a 20,000 mile trip on a *A carrier that could not have been purchased through UA, plus a UA transcon or two. Total UA spend was well under $1,000, and of course she’s a minor, so no credit card (and even if she had one, no kid of mine is ever going to spend $25K!).

  14. I think this is a good thing. Recognizes what, at the end of the day, is important to the airline which is revenue. All of the gaming and people reaping benefits without spending $$ and at times trumping those who are paid is not a good thing for a long term sustainable business model.

  15. Revenue requirements are completely sensible and I’m surprised it took the network carriers this long to implement them.

    The one provision I quibble with is the requirement that flights must be on UA or ticket must be issued by UA. This devalues UA’s partnership with its Alliance partners, especially those carriers that operate joint ventures with UA. What happened to “metal neutrality”?

  16. Thank god that Europeans can still be 1K without spending 10000$, after all we don’t have the credit card to manufacture spend.

  17. Dang, I am 1k primarily through tons of longhaul business class SQ flights. So, my questions is, will my current 1k status (I already qualified for 2013) still carry me through to 2015?

  18. The Presidential Plus card is no longer available.

    I have the feeling that the UA-issued ticket requirement is because UA can track that spending, while it is hard for them to track spending on other plates. And UA makes at least some money when it markets another carrier’s flight. So if it is ticketed on another carrier it still counts toward the mileage requirement but not the revenue requirement.

  19. What would happen if instead of using Delta or United program you switch to Air France or Singapore for example. Let’s say you keep flying Delta but add your miles to AF program and get to their top elite status based on mileage and not spending. Wouldn’t you have the same benefits when flying Delta using your elite level from AF instead of being a Diamond elite with Delta?

  20. I’m guessing at some pt American lets you buy elite status like they do at US Air. Probably north of $4000 plus they significantly reduce the number of systemwide upgrades. Doug Parker loves easy revenue.

  21. I mean that’s really the crux of it right? “Airlines don’t want there to be a game”. Of course not – this is a rational and expected response over time as more people become savy travelers and try to game the system. When loyalty programs started out it was based on a theory of the value of loyalty and retaining customers – they didn’t have to be as concerned about being more stringent on program efficiency because there wasn’t a community of people who valued status like many on FlyerTalk now do who have found ways to cheaply attain it. As more people got more savy and got more value out with less revenue to the airlines they naturally make it harder to extract as much value from the programs without putting more in.

    For members that are currently valuable to the airline this won’t be a problematic change (other than psychologically). I was just calculating the cost of some of my work tickets and my flights are regularly 46-56 cents per mile or more and I don’t book mileage runs so my personal travel averages 8-20 cents per mile so I imagine it’s less of an issue than people think.

    Certainly though it will cull some of the super-savvy 1K’s who spend very little to attain the status, but this makes complete sense from a business perspective. Who cares if you lose the loyalty of a 1K who managed to spend $5,000-7,000 to get status. They’re not very valuable to your bottom line.

  22. @ Santastico — You could certainly credit to other airlines, though their elite benefits aren’t nearly as rewarding (for example, no systemwide upgrades, no unlimited domestic upgrades, not mileage bonuses that are as big, etc.). Foreign programs just can’t typically compete with US programs, unfortunately.

  23. @Trajan81

    i Know, but i’m happy because as an 1k living in Europe i don’t have a spending requirement to mantain my status

  24. I fully expect the *new* AA to adopt this, but I would guess they’ll wait until they have a merged FF program. That could mean that the merged program launches in January 2015, and they announce in advance that qualification during 2014 will have a revenue component… or they wait until the merged program launches in 2015 (so 2016 would be the first year where qualification would have a revenue component)

  25. @Santastico: No. For instance, UA’s own elites get space-available upgrades on domestic flights. *A elites do not.

  26. @ isaac r. — Don’t disagree, but if you’re living outside the US how much better can you really do than 10 cents per mile anyway?

  27. @ Voice of reason — Agree with Carl, I think probably at least part of the reason for requiring United ticket stock is that they’d otherwise have a really hard time tracking revenue.

  28. I think those who assert that UA is imposing the revenue requirement to prevent people from “gaming the system” (by mileage runs and the like) are missing the point. There aren’t that many mileage fanatics out there, and I doubt they cost airlines much.

    No, this move is intended to change the behavior of the vast number of people like me, who reach lower-level elite status without spending much money simply by buying lower-priced fares. UA wants us to buy more expensive fares, plain and simple.

  29. @ Charles — I’m not actually convinced upgrades will get “much” easier as a result of this. Yes, it’ll eliminate some mileage runners, but I’d be willing to bet that a vast majority of elite members spend the minimum thresholds anyway given how high fares are nowadays.

  30. @lucky – Agree if you fly Delta mainly domestic. However, if you fly mainly international the AF program does not look bad since you only need 70K miles to reach Platinum level (equivalent to Delta Diamond that you need 125K miles) and you get 100% elite bonus.

  31. Yeah, I was bummed since I mostly fly SQ but I checked and in 4 legs I’m already at 8200 on UA for this year. So I suspect for a business traveler like me it will not affect 1k qualification, assuming I do one Asia or Europe trip on United (I’m in Houston so convenience isn’t an issue).

  32. Most of my flights are long hauls to either the Middle East or Asia which aren’t really that expensive on a cpm basis so I can rack up 100k miles on 5-6k spend. That’s where its going to hurt…let alone the has to be on a 016 paper.

  33. @lucky

    I just have bought all the tickets for this year and my spending , all in UA metal for 100,150 miles it’s just 5500$ , for 2 trips from Europe to Vegas, 1 to Alaska, 2 to Chicago, 1 to New York, 1 to Orlando and 1 to SFO and just 1 of those trips was a mileage run.

    From BCN i can find a lot of cheap travel to USA every few months.

  34. Will dollars spent to buy extra PQMs at the time of check-in count towards the PQD requirement? I’ve often spent the extra $0.07/mi at check-in to ensure that I’ll have enough PQMs to maintain my elite status?

  35. @ Neal — Based on the above it doesn’t seem like that spend would qualify towards the minimum requirement.

  36. @Santastico, I already credit my Delta flights to AF because they make earning elite status easier for me. They give you Silver status for only 15 segments (as opposed to 30 for US carriers) and Gold status for 30 segments (as opposed to 60). I got AF Gold status for this year from the limited time status match offer, and I have (surprisingly) received several Medallion upgrades on Delta. For someone who flies primarily on the East Coast and usually has to connect, I can keep Gold status for only 7-8 round trips per year.

  37. ok, I have so many questions now

    1. How do we know that it’s a UNited ticket when we are buying from OTA? They don’t show that until you book it…

    2. If I switch my address to NON-US address, how does that affect me? I have a chase card but I can cancel that right away

    3. Can anyone tell me a good FFP on Star Alliance to switch? Two things I liked about United:
    a. I like the bonus miles for elites from United, which is rare for other airlines because they usually give extra miles for their own flights and UA gives bonus for LH, NH, AC, US etc
    b. Their extensive and clear award redemption chart. A pretty good rate as well compared to other airlines.

    I fly mixed business and economy but mostly on partners not united because united sucks.

    Maybe Avianca? Turkish?

  38. I hope AA brings this. We need something like SQ has for PPS 25K SG spent.

    AA $20-25K =EXP LOVE IT!

  39. guess i will change my address to my wife’s house that she keeps in Thailand. I have a hard time believing it is that simple.

    And for those thinking this will make upgrades easier, it is only a matter of time before free upgrades go away, either through reduced capacity or copays of some sort. Oh well, it was good while it lasted, well at least until the next recession.

  40. As a Presidential Plus cardholder, I’ll be very curious to see how they treat us and our FEQM after 2014.

  41. Are the 6 SWU’s gonna be 10K PQD requirement as well?? How about additional 2 SWU’s every 50K PQM beyond 100K PQM??

  42. Was sitting on the fence about status matching from AS MVP Gold to UA Gold this summer. With this being the last PDQ-free qualification year, it makes even more sense to do it now, unless i’m missing something?

  43. @ Ray — Well the SWUs are given for reaching 1K status (as of now, at least), so however you earn that (whether it’s with the spend requirement or with a foreign address) should be fine.

  44. @ DBest — Assuming you’ll be doing a fair bit of flying on them then yes, I’d say that’s a smart move.

  45. This will have no impact on me at all. These revenue thresholds are not difficult to obtain at all.

  46. If you’re already 1k, you’re already spending >$0.10 / mile whenever you want to buy a W-fare to use a GPU. So in order to get the most benefit of your status, they kind of force you already to meet their spend requirements.

    The problem is, when your upgrade doesn’t clear, you just wasted a bunch of money for no reason. This is why the AA system of any fare GPUs, prioritizing for fare class, is better. You don’t feel bad if your upgrade doesn’t clear.

  47. I don’t see AA’s generous SWU policy lasting much longer, maybe through 2015 if i was to guess.

    As far as the W fares on UA, i only book a W fare if the R space is available anyway. But would not be surprised if UA makes this harder as well and goes to the Y/B/M model of Delta for these.

  48. @Carl – Sometimes travel plans are not so flexible to book R available flights, and you have to roll the dice.

  49. It seems that there are quite a few of us that have foreign address (be it legit or some “friends”). I’m wondering if I change my UA MP address to my Europe one but still have the Chase UA cards, will that cause a problem? Will the cards override the foreign address or just the cards wont credit any miles to the UA account? How does that work with on Delta’s side? (seems that others “moved” to foreign address there)
    And what about cards like the sapphire?

  50. @snic: “No, this move is intended to change the behavior of the vast number of people like me, who reach lower-level elite status without spending much money simply by buying lower-priced fares. UA wants us to buy more expensive fares, plain and simple.”

    I agree absolutely. I doubt they are wasting a lot of mental effort thinking about how to screw mileage runners.

  51. @ Jason — Well the policy isn’t in place with Delta yet either, so it’s anyone’s guess how this plays out. The way they phrase this seems very open ended to me, so I’d give it a try and see what happens.

  52. I’m 1K and also EXP and I like the revenue qualification idea. This will eliminate some mileage runners. However I just calculated how much I spent this year so far, a little over $7K for 96K miles on United. So even for regular travelers like me it can be hard to qualify, and I can say goodbye to flights on SQ, TK and LX 🙁 But 1K can become a rewarding status for real loyal UA customers again.

  53. @lucky – I’ll see how it goes cause later this year I will change my address (and maybe by then we will have some more info. It wouldn’t be as harsh as 1K was waived with the card spend) I’m already at 750K+ lifetime on UA and after this year’s summer MR ‘fest I will be close to 840K by Jan 2014. If next year the cards collide with the MP address verification, then I’ll just have to do the missing 160K lifetime in a year, clear the 10K min spend, earn a bunch of GPUs and RPUs, cancel the Chase UA cards and start off 2015 with lifetime UA gold with the 1K and then no min spend to worry about 🙂
    I can just look at it as a excuse to do one hell of a MR year at a very low CPM at the worse case scenario.

  54. I normally make 1K on about 50% leisure, 25% “unmanaged” business travel, and 25% MRs. I usually book in advance at the lower fare buckets. This change won’t cause me to intentionally book higher fares. Instead, it will incent me to STOP giving incremental revenue to UA, even if their fares are higher than the competition’s (which they often are).

    This is a horrible outcome for UA if they push away formerly-loyal pax who used to pay more than necessary for the sake of remaining loyal. It also creates very troublesome incentives for those spending other people’s money.

    People like me fill seats that would otherwise go out empty. HVFs are at the heart of PRASM. If both groups decide that “the game” is no longer worth it and move to individual-transactional decisions, how does UA win exactly?

  55. The fact that this doesn’t apply to members with addresses outside of the USA is a loophole wide enough to fly an A380 through. I imagine UA will see a fair few of its mileage runners mysteriously move abroad.

  56. Don’t understand why people just pay to obtain status. I mean if your company pays for all your trips and you are missing a few miles, I guess it is OK, but to pay out of your own pocket does not make sense to me. My opinion.

  57. One thing I don’t understand and it is th same with Delta is why they have different tiers for spend to reach each status(makes sense) yet the credit card spend is the same for silver as it is platinum.

  58. If you use an e-cert for travel, does that count as a payment method, or a reduction in fare?

  59. really seems like they want to please those who fly domestic and spend the increasingly high domestic fares for business travel. In a way, the current miles criteria is a a bit lopsided since international travel, especially to asia has a lot of competition and number of miles you accrue per dollar spent is way more than what you’ll ever get for domestic only travel.

  60. This will either push away mileage runners, or embolden them. Some of us mileage run at < 3CPM fares mainly for *RDM*, and as such, status requirements don't affect us except for the RDM multiplier after 2014.

    But if you mileage-run 200,000-300,000 miles, at 3.3 CPM you can still hit 1K.. by paying $10k for 600,000 RDM! This just tightens up the cost calculations, and really makes it necessary to get < 3 CPM fares.

    This year I'm splitting my 200k of flying across US and UA to get 1K + Chairman, but if AA follows suit I might just double-down on UA and mileage run the hell out of them – primarily for RDM.

  61. @Ben Hughes That’s some serious mileage running, the casual mileage runner does a cheap trip or two to round off their account. The number who aspire to do that kind of mileage is tiny.

  62. Living in So Cal, I can get a mailbox in Mexico.

    Game on United.

    I will definitely be closing by United Mileage Plus card in 2014.

  63. @Josh:
    When I changed my US address to one of my other legit residences, Delta required proof by means of, but not limited to:

    1. Government issued ID with new address (drivers license, learner’s permit, country/state-issued photo ID card)
    2. Utility bill in customer’s name showing new address, dated within the past 60 days
    3. Deed, mortgage, monthly mortgage statement or residential rental/lease agreement showing proof of ownership at new address, with customer’s name and signature. Lease must be dated within the past year.
    4. Bank statement with customer’s name and address dated within the past 60 days (may block out sensitive information)
    5. Payroll statement with customer’s name and address dated within the past 60 days (may block out sensitive information)
    6. Postal Service change of address confirmation form
    7. Current automobile or life insurance bill, or homeowners or renter insurance bill (cards or policies are not accepted)
    8. Copy of school records/transcript from a school in which the applicant is currently enrolled, issued by an accredited school
    9. Postmarked mail with forwarding address label (must display the customer’s full name)
    10. Receipt for personal property taxes or real estate taxes paid within the last year
    11. Letter from member’s employer, on official company letterhead, detailing member’s current address. Letter must be signed by employee’s supervisor with supervisor’s full contact information

    FWIW: The idea of simply renting a PO Box somewhere across the border doesn’t seem to fly that easily 🙂

  64. @nomad WOW. I’ve changed my country of residence with American Airlines, United, British Airways, Virgin Atlantic, Iberia, Qantas, ANA, SAS, Hyatt, Hilton, Starwood, Hertz and Avis, and wasn’t asked for any proof from any of them. (The move was legitimate, btw!) Either Delta is a crazy exception, or your patterns flagged something in their system.

    That being said, I won’t be surprised if United implements some kind of verification under their new Mileage Plus rules. Alternatively, the first time someone gets caught, has their account canceled and loses all their miles and status, I suspect people will think twice… 😉

  65. @Josh:
    No pattern whatsoever – completely legit with plenty to proof authentic foreign address.
    Mind you, this is Delta and it’s required for every country-of-residence change since the announcement of the new Skymiles program

Leave a Reply

Your email address will not be published. Required fields are marked *