Update: It appears that this was all a huge glitch/misunderstanding. Here’s an official statement from American:
Last night, in a routine effort to better align American to industry standards with other global carriers, American began collecting carrier-imposed surcharges on tickets for travel on other carrier’s metal. This change was intended for revenue tickets only, but the surcharge was erroneously added to AAdvantage award redemptions on other airlines as well. Except in the cases of British Airways and Iberia (where American currently collects these surcharges), no carrier-imposed surcharges will be applied when redeeming AAdvantage miles for award travel on other carriers. Any customers who encountered this fee in error will be fully refunded.
Overnight I posted about American’s brand new policy of imposing fuel surcharges on award tickets. I live and breathe miles and points, and as ridiculous as it may sound, I can’t even begin to describe how numb I felt when the agent read me the memo about the new policy last night. Yes, admittedly I perhaps have some vested interest in miles being “lucrative” given what I do, but more than that this hobby really is one of my greatest passions, and it kills me to see it change.
Naturally I pulled an all nighter, calling about every five minutes to try and price different awards, to see what was really going on. I emailed a contact at American asking for an official statement, and hope to have an update from them shortly.
Anyway, I really can’t even begin to rationalize how this change could have occurred for a variety of reasons, including:
American has an amazing track record the past couple of years
Maybe I’m naive, but something tells me that American doesn’t realize what they’re doing here, and that a mid-level bean counter made the decision.
I believe this because American has proven over the past couple of years that they’re the legacy airline with the most integrity. The former head of AAdvantage, Maya Leibman, and current head of AAdvantage, Suzanne Rubin, have both proven to be really strong, customer-focused leaders. So I just have a hard time imagining that without any advance notice — let alone an announcement — they’d make a change this severe. This type of a change with no advance notice literally destroys all the goodwill the airline has worked so hard to build up with their frequent flyers over the past couple of years. And maybe this is just what happens when you start to trust an airline, and believe they’ll make rational, fair changes with advance notice…
Frequent flyer program changes don’t usually happen during mergers
If history is any indicator, airlines typically don’t make major changes to their frequent flyer programs during mergers. Usually those only occur once the programs are combined. This is not only because they have bigger fish to fry, but also because they don’t want to piss off members when negative changes may just be reversed under a new program.
Changes especially shouldn’t happen when the DOJ is trying to block a merger…
This, in particular, is the reason I don’t think a higher-up, rational person had anything to do with these changes. The DOJ is trying to block the American/US Airways merger because they think if the merger occurs there won’t be enough competition and consumers will essentially be the victims. Adding fuel surcharges to what are supposed to be “free(ish)” tickets probably won’t sit well with the DOJ, and I can’t help but think it’ll further hurt their chances at the merger being approved. And all of this is right after American announced record monthly profits for the month of July.
Frequent flyer program changes don’t just impact the airlines…
Yes, foreign carriers do mostly impose fuel surcharges, but the really unique thing about US airlines is that half of their business nowadays seems to be running their co-branded credit card business. So I have to imagine they don’t have the sole discretion to make decisions like this overnight, especially decisions that massively alter the value of the millions of dollars worth of miles that they’ve sold to Citi.
And to be clear, these fuel surcharges aren’t going to their partner carriers. I mean, indirectly they could be in that they’ll be used to compensate their partner airlines for award seats American uses, but Qantas isn’t coming to American overnight here and saying “hey, we want the extra $700 fuel surcharges for the coach award ticket you booked on us between Los Angeles and Sydney.”
While I’m usually a huge fan of American’s Twitter team and social media, the way the current situation is being handled is pretty horrible. American’s Twitter team is simply repeating “We’re collecting other carrier imposed charges effective today. Some carriers may have exemptions.” And when people ask which carriers this applies to, they have responded with “We’re unable to provide a list via Twitter. Please call 800-882-8880 for more info.” Now, in fairness they were probably totally blindsided by this, so they’re literally having to make the most of the information they have, which is… nothing.
That’s why I don’t think it makes sense to start a “campaign” against this just yet. Let’s wait for an official announcement and then we’ll share how we feel.
Who knows, perhaps these fuel surcharges will just apply to Malaysia Airlines for now, and the memo was written in a much broader way to give them more leeway long term.
To put this into terms that even Honey Boo Boo can understand, yesterday American was Hannah Montana, today American is Miley Cyrus at the VMAs.