Air Canada’s Aeroplan makes huge changes, both good and bad

Aeroplan, the spun off frequent flyer program of Air Canada, announced some massive changes today, which will kick in on January 1, 2014. Now I’m not much of an Air Canada flyer, so what concerns me most personally is the value I can get out of transferring Membership Rewards points to them for award redemptions. Up until two years ago Aeroplan had hands down the single best frequent flyer program for award redemptions. They didn’t impose fuel surcharges for travel on partner airlines and had almost artificially low redemption rates. It was amazing. Then in 2011 they massively increased the number of miles required for certain awards and began adding fuel surcharges to a majority of their partner airlines.

Now they’re back with some more changes, though at least they’re giving over six months of advance notice.

The good news on the award redemption front

What’s great news is that Aeroplan will start charging 50% of the roundtrip cost for one-way award travel. Currently they charge 67% of the roundtrip cost, so that’s really exciting. But…

The bad news on the award redemption front

They’re also increasing the number of miles required for certain award redemptions in first and business class… by a LOT.

Aeroplan_Award_Increases

Business and first class class between North America and Asia, the Middle East, Africa, Australia, and New Zealand, go up by 25,000-40,000 miles roundtrip.

And this is on top of their already increased award rates. To put this into perspective, two years ago first class between the US and Asia “zone 1” cost 120,000 miles. Now it’ll cost 210,000 miles. That’s an increase of 75% in the number of miles required, and that doesn’t even factor in that they’ve started to impose fuel surcharges on partner redemptions, so you’re potentially paying an extra $500-800 roundtrip for an award ticket in addition to the extra miles.

On the plus side, there’s still one decent value left on their chart, which is travel between the US and Europe “zone 1” for 90,000 miles in business class. I think that’s about the only deal worth redeeming for on their chart anymore, at least if you’re transferring points from American Express Membership Rewards.

On the whole I’d say the award chart changes are quite negative, though I do like the ability to redeem for one-ways at half the cost of a roundtrip.

No more seven year mileage expiration policy

Miles no longer expire after seven years. While you’ve long needed activity in your account at least once per year to prevent your miles from expiring, they expired after seven years regardless of activity. That’s not the case anymore — now you just need activity once per year and your miles will never expire.

Introduction of Distinction program

Aeroplan is creating a “frequent buyer” program of sorts, in that they’re awarding benefits to those that accrue 25,000, 50,000, or 100,000 (non elite-qualifying) miles in a calendar year. The benefits are as follows:

Aeroplan_Distinctions

Anyway, on the whole I think these are negative changes, though I really do like the ability to redeem for one-ways at half the cost of a roundtrip. 45,000 miles for a one-way business class award between the US and Europe is pretty tough to beat.

(Tip of the hat to Gary)

Comments

  1. My read early early this morning was that one-way awards would be 50% roundtrip for Air Canada metal.

    But the website is currently down for the changes so I cannot verify my initial read.

    Did you take the announcement to mean one-ways would be possible on Star Alliance partners at 50% of roundtrip?

  2. Would “accrued” miles for the purposes of the Distinction program include miles transferred from Amex?

  3. So what reason is there for a UA flyer to deposit miles in Aeroplan instead of UA?

    Overall the elimination of the 7 year rule is great news but too little too late. I have some miles (DL) that are 20 years old so i would never consider any program that has a hard expiration date.

  4. Just reached my accrual goal to book a mini RTW with Aeroplan. Guess I better get those miles burned before these changes kick in.

  5. @ Jim – I was wondering the same thing, but we’re talking about Aeroplan here 🙂 Strictly speaking, you’re not really accruing miles, you’re transferring them. While I won’t get my hopes up, my fingers are crossed. If not, I may have to shift my business spending to my CIBC Visa.

  6. @Boraxo

    just the fact that you have skypesos that are 20 yo is a proof how useless they really are…
    😉

  7. I thought it was bad (well it is with the higher redemption values) but you can still do a RTW for 125K in J and 175K in F (if you can find it) plus YQ scam charges.

  8. @ Gary — My read is the same as Jonathan’s — believe Star Alliance qualifies as well.

  9. @ Jim — Unfortunately miles earned through conversions (like Membership Rewards) are specifically excluded.

  10. @ Boraxo — They do still have a fairly low elite qualifying tier for Star Gold, though I wouldn’t be crediting miles to them.

  11. When AirCanada/Aeroplan announced the “seven year rule” in 2006, they “grandfathered” all miles earned by year end 2006 as if they had been earned in 2006. So anything earned before Dec 31, 2006 has been scheduled to disappear (if not used) on Jan 1, 2014.
    Does the elimination of the seven year rule take effect today or in January 2014, along with the new tables.
    Said another way, will all miles earned by Dec 31, 2006 that have not been used, disappear at the end of 2013 and then they start the “no seven year rule” or are they eliminating the seven year rule today so as to avoid a lot of angry members who “forgot” that the pre 2007 points will expire at the end of 2013?

  12. I have never flown on Air Canada or used their frequent flyer program. Would be nice if all one ways were 50% of the round trip price on partner airlines tho. Will wait and see what you guys find out.

  13. @ Rob — Best I can tell they’re reversing the policy before it could even go into play.

  14. Another huge related announcement for Canadians (I understand it’s not as relevant to your blog readers in general) is the potential switch of Aeroplan’s co-branded Visa from CIBC to TD Bank. CIBC has been there since the beginning and their Aerogold Visa is one of the most popular cards in Canada (undeservedly, in my opinion…). This would be like United telling Chase they’re going with Citi unless Chase matches the deal.

  15. Ben,

    I agree with you that the only award worth redeeming for is N America – Europe zone 1 in J.
    Yet, to assess whether or not I can avoid YQ scam charges by only flying UA and LX, I did a mock booking on ua.com and ap.com.
    On ua.com I found on several dates several UA-only flights that did not show up on ap.com
    I guess the latter site is trying to steer me toward AC and LH flights and resulting fuel surcharges(…)
    Do you know if I call AP’s call center, whether I can feed the agent UA-only flights?
    If not, I’m going to dump my AP miles.
    Thanks. Mach’s gut,
    Jeffrey

  16. @ Jeffrey — If you call they should be able to see the flights as well, assuming it was saver award space.

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