United MileagePlus Award Chart Devaluation

Oh man, oh man, oh man. I love weekends, but I hate waking up Friday mornings. Why? Because all the bad news in the airline and hotel industry seems to be announced overnight on Thursdays.

Well, United has just announced a massive devaluation to their MileagePlus award chart, and I don’t think it’s unreasonable to say that it’s unprecedented. I actually think it’s the airline equivalent of the Hilton HHonors devaluation we saw earlier this year.

United MileagePlus award chart changes kick in for tickets issued on or after February 1, 2014. That means you have until January 31, 2014, to issue award tickets at the old rates.

You can compare the old and new charts here:

Not only are they greatly increasing the number of miles needed in many markets, but they’re also separating out award charts — now there’s a different award chart for travel on United vs. travel on their Star Alliance partners. This represents a pretty big change, since up until now award costs have been the same regardless of whether you’re flying United or one of their partners.

Changes to United’s saver/standard award chart

The changes to the United saver/standard award chart aren’t horrible. Basically in many cases they’re just matching the highest rates charged by other major US airlines. In many markets rates stay the same, and mostly we’re seeing increases of 2,500 to 7,500 MileagePlus miles one-way.

The biggest increase we’re seeing on the award chart for travel on United is for first class travel between the US and Middle East, where they’re going from charging 75,000 miles to charging 90,000 miles. That’s basically matching American’s redemption rates in the market.

If this were the extent of the changes I’d consider them reasonable.

Changes to Star Alliance award chart

This is really the worst part of the changes, especially for those that like to redeem miles for first class travel on Star Alliance partners.

The increase in mileage required for travel on Star Alliance partners roundtrip is as follows (I bolded the ones I consider to be especially bad):

  • US mainland to Alaska: 10,000 miles economy, 10,000 miles business, 10,000 miles first
  • US to Southern South America: 10,000 miles business, 5,000 miles first
  • US to Europe: 40,000 miles business, 85,000 miles first
  • US to Middle East: 5,000 miles economy, 40,000 miles business, 130,000 miles first
  • US to Central Asia/India: 5,000 miles economy, 40,000 miles business, 120,000 miles first
  • US to Japan: 5,000 miles economy, 30,000 miles business, 85,000 miles first
  • US to South Asia: 15,000 miles economy, 40,000 miles business, 100,000 miles first
  • US to North Asia: 5,000 miles economy, 40,000 miles business, 100,000 miles first
  • US to Oceania: 30,000 miles business, 70,000 miles first
  • US to Australia/NZ: 25,000 miles business, 100,000 miles first

Okay, so on second thought they’re almost all really, really bad.

Some first class redemption rates have increased by almost 100%, which is the highest I think I’ve ever seen. Going from 150,000 miles roundtrip to 280,000 miles roundtrip? Wow!

But the real problem with increasing the number of miles needed for a Star Alliance redemption so drastically is that it’s not like you have a choice as to whether to fly United or other airlines in many markets. For example, say you want to fly to Dusseldorf. If you book United from Chicago to Frankfurt roundtrip in first class, it would run you 160,000 miles under the new United chart, while if you wanted to include the tag flights from Frankfurt to Dusseldorf (which makes it a Star Alliance award) you’d suddenly pay 220,000 miles.

The whole benefit of an alliance is that that they take you places that “your” airline can’t take you, and by creating a separate award chart for travel on Star Alliance carriers, they’re massively jacking up the cost of reaching all the destinations they don’t serve on their own.

Overall implications of the devaluation

On one hand I’m really not surprised by the devaluation. I wrote a post less than two weeks ago predicting a devaluation was imminent. In the past year hotels hugely devalued their award charts, while now it’s the airlines’ turns, given record profits and load factors.

Ultimately these changes reinforce what we already know about miles. First of all, they’re not a currency you should ever “invest” in long term. They’re extremely valuable and lucrative, but it’s best to have an “earn and burn” mentality. The quicker you can cycle through them, the better. Also, while these changes suck, in absolute terms our “buying power” with miles really isn’t decreasing. It’s so much easier to earn miles now than even five years ago. This hobby is always about staying ahead of the curve, and we’ve been ahead of the curve with the old award chart for a while. Now it’s time to get ahead of the curve on the new chart.

Now the questions is when American and US Airways will match. Delta has already announced a devaluation for international premium cabin travel as of June 1, 2014 (kudos to them at least for giving tons of advance notice).

The question now is whether American and US Airways will match — I shared my thoughts on that in this post.

Anyway, it’s a sad day for the mileage world…

Comments

  1. jim says

    start a Twitter campaign. Include United and chase in every tweet with the hashtag #unitedunfriendly. Spread it everywhere and overwhelm their Twitter accounts

    jeff.smisek@united.com needs to hear from everyone

    twitter/united facebook united airlines

  2. Dale says

    And many people said with Chase Ultimate Rewards, that we were a United devaluation away from bringing that program back down to earth… Maybe not in the same category as AMEX MR losing United, but it closes the gap big time between the two…

  3. Eric FD says

    Lucky, I wonder if we can use this trick to avoid the partner high rates…

    if we say fly on an itinerary mostly in United business/first, with only a short segment on another carrier… would we would be charged the United award rate or Partner award rate if we purposely book downgrade ourselves to economy on the partner segment?!?!

    For example, IAD-FRA-VIE…. with IAD-FRA on United Business/First, and FRA-VIE on Lufthansa — but we purposely downgraded to economy on LH segments. would we then get charged the United or Partner award rate? should be United because only United is business.

    United should definitely clarify this. and it would lower my heart spasms right now over this.

  4. Kai says

    Seems to me that most of the devaluations affect routings to/from N. America? Didn’t notice anything for intra-Asia.

  5. Bgriff says

    I had been considering getting into the Chase UR world and would now say I can safely forget about that for the time being. I would imagine for most Star partner bookings the various Star MR partners now offer much better options (even the ones with what-previously-seemed-to-be-ludicrously-high-redemption-rates in some markets, like SQ), even if there are fuel surcharges in some cases.

  6. beltway says

    ALso, I think there’s a typo for US-Middle East. F increase is 130K, not 120K. (It looks like it’s this jump you’re referring to after the bullet list when you mention a RT increase from 150K to 280K.)

  7. Justin says

    Well now I’m really between a rock and a hard place … Amex has no more referral mall and Chase just, effectively, lost their #1 transfer partner.

    Having a hard time trying to decide where to direct my spend… I guess SPG is safe for now?

  8. beachfan says

    Hi Lucky;

    If I recall correctly, you had a post on the best use for miles on United (or favorite use). If so, could you link to that post.

  9. rick b says

    Do you not think First class is at least 3x better than coach? If you do, then this is still a good value. It costs 10x more to buy a first class seat, instead you spend only 3x the miles which are easy to mint.

  10. Kris says

    @Eric FD
    what clarification is there to need? You are charged based on the highest cabin of service booked, that’s how it’s been for as long as I can remember.

  11. Derek says

    This was just a matter of time because they showed so many partners available online. So anybody could find the space on united.com so they drastically increased the number of redemptions on partners by making them available so simply to everyone including those not in the know.

    I bet if you compare US and UA redemption rates on partners, they are starkly different though they have the same availability to the same flights in the same cabins (we know some isolated blocking issues on US side).

  12. rick b says

    @Derek +1

    I’m all for educating and enabling the public, but it needed to stay obscure, on FT and awards need to be hard to find. Those who are worthy of the knowledge will find it.

  13. Jeremy says

    I’ve already started to slow my manufactured spending down over the last month or two with a balance of nearly 2 million miles/points…this will probably be the change that forces me to stop doing as much manufactured spend and probably say goodbye to UA until inevitably AA/US follow. Sigh…

  14. RA says

    In your example you state 170K for first class on united to europe. The chart seems to be 80k each way for saver so 160K?

  15. Eric FD says

    Kris- But this is new system. Highest cabin now depends whether United metal or partner. Higher cabin would be United, but it is a Star booking with a partner segment. But it is not a partner business cabin- it’s just economy. Hence whether such a mixed cabin itinerary with UA biz can be priced as United award rate.

  16. eponymous coward says

    @ Kai:

    Nope, Intra-Asia is whacked on partners, badly. Intra-South Asia in C is 50K UA r/t, 60K partners, from 35K now. Other intra-Asia awards are similar.

    And to think it was 30K on CO in 2011…

  17. says

    @ Eric FD — Unfortunately you’d still be charged the higher rate. You’re charged for the rate of the most expensive cabin you’re flying, and if there’s any travel on partner airlines then you will be charged based on the partner award chart.

  18. Slider34 says

    Hey it’s 2500 miles less to get from Australia to Hawaii now!

    I was just getting started gathering United Miles. BOO!!!

  19. Tom says

    Okay…. this is the price for the elimination of Starnet blocking. A lot of folks and a lot of bloggers gushed about its elimination when Continental took over United. Well give me Starnet blocking back thanks and take away the two charts.
    Pretty much like everything since this merger took place, this is a very greedy grab on United’s part. They seem to be so desperate to cut costs to make up for their mediocre overall performance. This latest cut leaves an even worse aftertaste than the nasty new complimentary liquors in the United Clubs.

  20. Nick says

    @Lucky, can you book an itinerary before February 1st and then, once it’s ticketed, change the dates of the itinerary around (and incur the change fee) in perpetuity without having to buy up to the new mileage requirement?

  21. Shafik says

    This is a shut up response to all bloggers that keep bragging about flying Star Alliance first class when they can barely afford a coach ticket. It is clear that airlines want first class people on their first class cabins and not point and miles hoarders that get into their first class cabins and start taking pictures of even a paper napkin. That is what all airlines will do and they are only protecting real first class customers that pay $15k+ for that seat and do not want to share the cabin with people that do not belong there.

  22. mileswhore says

    Jim: you hit the nail right on the head!

    What I am seeing so far is a bunch of blogs explaining how we just got screwed. How about flipping the tables and use the POWER of the voice in letting our feelings as customers known? How about some of the bloggers reaching out to the NY Times and other publications so their investigative reporters can see how draconian this is? This isn’t a devaluation, this is a slaughter.

    Think these:

    jeff.smisek@united.com

    Twitter.com/United

  23. Sean M. says

    I’m actually pleased with this chart change. My usual *A award (Central Asia to Central/South Africa) has reduced from 40k in Y/60k in J to 30k in Y/55k in J. Great stuff!

  24. Seth says

    I’m not trying to defend United, and I know I’ll be flamed for making this observation, but lets look at this another way. Delta recently announced massive devaluations on the earning side of their program for partner flights. United has just announced a devaluation on the redemption side of their program for partner flights. Its bad, yes, but at least when you are flying AC/LH/SQ et. al. you are still earning 100% RDM/PQM. Awards have always been a way to fill empty seats in exchange for a marginal realization of revenue. With loads at 85%+, it only makes sense that awards would get more expensive as there’s more demand for each seat. But I, for one, would much rather earn 100% and burn at higher rates (knowing that a seat will be available with UA and partners) than earn at 20-50% (and no EQMs in some cases) and take a gamble on when/if a seat is available and how expensive a seat may be when it comes time to redeem my miles.

  25. eds says

    Ok, lets face it. Someone did some analysis and figured out that too many people were signing up for two/three credit cards, and then redeeming very expensive F tickets on their partners.

    This is the nature of arbitrage, you find hole, you exploit it until it closes, and then you move on to next hole that you find.

    The people who really have a right to be angry are those who earn miles the old fashioned way – through flying.

  26. RA says

    With all of the changes (50% bonus for gold and %75 for platinum instead of 100%, increase in UA club fees, increase in miles need for partner award, spend requirements for status, decrease in elite upgrades), I see no reason anymore to stay with one airline. It makes it easier to fly based on cost per ticket rather than loyalty.

  27. Paul says

    Lucky,

    I have a March 2014 booking in J on star allianc partners. I was hoping to change to F in the 14 day window to F to try out lufthansa.

    Since I booked the ticket originally before 2/1/14, will my rate still be the old chart?

  28. Paul Tudor says

    @mileswhore: I guess you are too late. Real first class customers already made a complaint to airlines saying they pay $10k for a first class seat just to seat next to a credit card points collector that will be bugging him the entire flight by taking pictures of everything. Those are the real customers that matter to airlines. Not credit card customers. You are complaining about huge increase in first and business class awards. How about seeing that coach awards did not increase that much?

  29. Kirby A says

    It sucks watching all the programs devalue knowing that I can’t really take advantage of my miles for the next two years… They’re just sitting there losing value and I can’t do anything about it!

  30. Eric FD says

    Lucky- thx, except we are now marching into new territory with this new award system. I think if there is any wiggle room or ambiguity– we could perhaps push MP to clarify and rule on it. It’s just really unfavorable and downright unfair to travel to any city not served by United anymore, even if we fly on United 95% of the total distance. United has a big network but barely flies to 5% of the airports in the world. I just don’t think UA thought about this discrimination against people who live in cities not served by UA– and it’s not a cost problem if it’s only the last mile segment on a partner in economy since costs on a mixed ticket is always prorated by distance+cabin flown– it’s standard industry practice.

  31. LK says

    Definitely a game changer.
    I will spend less time on this crazy hobby and find something else to arbitrage.

  32. Paul Hurtson says

    Funny that nobody mentioned that the coach awards did not increase much. People are complaining that business and first class awards went way up. Didn’t you understand the message hat UA and Star Alliance partners are sending here? They DO NOT want credit card collectors flying in their premium cabin. They are tired of seeing pictures of their napkins, soaps, socks, etc… on blogs. People that pay for those seats probably complained so they sent the message. Got it?

  33. Dax says

    Can’t wait to see the next round of card links touting the amazing flexibility of a program that is in the process of being gutted.

    Southwest Rapid Rewards – Revenue based, no tricks

    Executive Club – Long haul disaster, no connections

    Korean Skypass – Still stuck in the Stone Age

    Marriott Rewards – Nine categories of Mediocre

    Priority Club – Holiday Innocuous at Hotel Incontinent

    Mileage Plus – Currently being gutted as we speak

    Hyatt – Myatt be the next one on the list

    Guest Rewards – Better have a go before they’re defunded

  34. Mikey says

    looks like I lucked out, I just booked san/hkt first and business classes for 2 in sept 2014, ( just before reading this)

  35. Steelsnow says

    I agree with what eds said… This is the nature of arbitrage (or the ‘deal’). People ‘find the hole’ (or sale, or opportunity), they buy, take advantage and/or use it while it is available (or until it sells out or disappears), and then the ones used to looking move on to next opportunity they can find.

  36. says

    Lucky, do you think United will allow changes to tickets booked prior to 2/1 to be made at old award levels? I am thinking of booking a bunch of awards and than playing around with dates and routings later on. Or do you think once you reticket, it will be made at new levels?

  37. Eric M says

    Paul (Post #43),

    I am in the same boat as you as I have reservation mid Feb.. I too am wondering how that will work out trying to get LH F.

  38. Bgriff says

    Lucky, in addition to the post ideas raised by Justin and beachfan above, it would be good to have a primer on good ways to redeem miles via other Star carriers (especially MR partner Star carriers), where there are and aren’t fuel surcharges, etc. — though I suppose that one can wait until closer to Feb 1, once the UA door is fully closed.

  39. Larry D says

    I’m intrigued on the separate Award Chart for United vs. Partners. Miles and More limits (and in most cases prohibits) first class redemptions on their airlines. United changing baggage policy for Star Alliance Gold (now 1 bag) and Silver (now zero bags), and Air Canada space not being equally available among partners? (See MileValue’s post on Oct 22). Sounds like there’s a lot of issues at Star Alliance.

  40. Greg says

    I think Eric is right here. The partner award chart explicitly says “This chart also applies to Business/First Awards for itineraries that include travel on both United and at least one partner when at least one flight segment on a partner is in Business or First.”.

    Therefore, if no partner segment is business or first, then United’s own award chart should apply.

  41. Eric FD says

    Thanks Greg for checking — where did you get this quoted excerpt from? would be good if we sought and got official confirmation from United representatives about this issue.

    it is wholly unfair to charge partner biz/F if we fly IAD-FRA on United Global F and economy LH on intra-europe shorthaul.

  42. Dax says

    Star Alliance has always been at the forefront of the global alliance experiment. It’s becoming increasingly revenue focused. In due time the ability to book points based awards throughout the alliance will become a distant afterthought.

  43. Rob says

    Is it time for you to say your last goodbyes to the LH FCT?

    LH F becomes unreasonable with MileagePlus
    Aeroplan and M&M have high miles and cash outlays
    Can’t book LH F with dividend miles

    So how are you getting into that lounge?

    ANA? That’s going to set you back at least 100K MR points (more if you’re itinerary doesn’t start on the east coast and/or doesn’t end in FRA) and a lot of $$$

    What else is there?

  44. Raymond says

    Also notice that the Standard award now is more than 2X of the Saver Award rate.

    e.g. NA -> North Asia is 80K one way Saver vs 190K Standard

  45. Jerod says

    All joking aside, does anyone else think it strange that UA commits to a massive devaluation that brings bad press almost the very moment a tragic shooting at LAX occurs? Would anyone be able to determine which was reported first? Did UA want to knock down their aviation news a slot down from the headlines? Thoughts and prayers to everyone at LAX. Hope everyone is safe.

  46. says

    @ Jerod — For what it’s worth the change was announced overnight while the shooting happened just a couple of hours ago, so definitely not related.

  47. Eric FD says

    Rob- i think LH First is still possible on limited basis with Lifemiles. however, because Lifemiles doesnt allow mixed class awards, and LH First is only marketed on long haul routes (intra europe’s highest is ‘I’ biz inventory), that means Lifemiles only works for long haul itineraries with only ‘O’ class, and no mixing with other short flights.

  48. says

    @ Rasputin — Whoops, looks like I was a bit off on the South Asia first class price — fixed that now. Did I mess up any others?

  49. Larry D says

    I’m intrigued on the separate Award Chart for United vs. Partners. Miles and More limits (and in most cases prohibits) first class redemptions on their airlines. United changing baggage policy for Star Alliance Gold (now 1 bag) and Silver (now zero bags), and Air Canada space not being equally available among partners? (See MileValue’s post on Oct 22). Sounds like there’s a lot of issues at Star Alliance.

  50. Nun says

    I don’t understand why bloggers keep doing the airline’s work for them. Stop documenting where one program offers a deal that is too good compared to other programs. Stop writing that “X airline must be about to devalue Y award, because it’s just so good.”

    Companies are ALWAYS looking for fat to trim, and you’re just speeding up the process for them.

  51. Brandon says

    The separate partner award prices don’t bother me too much, seeing that United and partner award redemptions have the same price on all economy awards. However, it does make me fear that they’ll make partner awards cost more on economy the next time UA changes their award chart.

  52. says

    Re delta “(kudos to them at least for giving tons of advance notice).”

    That isn’t actually right — Delta implemented the changes with no notice whatsoever, they applied them to travel that began in June 2014.

  53. Boraxo says

    This doesn’t even belong in the same league as Hilton. Hilton essentially doubled the price on its best hotels. UA went up 15% at most on its own flights. Which will still get you to 4 continents and many great locations. The value of UA miles is not so far off the competition, which is why you don’t see bloggers telling people to move their accounts to LH, DL, etc. In fact DL is far worse because their saver chart is just a lie. Compare Hilton, where every competitor offers a better value, and some are 50% less.

    Hilton basically gutted the entire program except for those low value properties that almost nobody wants to use points to stay at. UA basically gutted its high value *A awards but still offers alternatives and did not gut its own program. That’s a huge difference.

  54. Ed says

    Small point of pedantry if you really wanted to go to Dusseldorf via Frankfurt you could get there by train faster than the bus to the remote stand and taxi to the end of the runway would take.

  55. concorde02 says

    the gaps between F and J award in most markets have always been small.. now it is bigger than the gap between J and Y.

  56. says

    2 questions this brings to mind…

    Doesn’t this screw the Star Alliance partners by driving many more United people to use points on those airlines?

    Was this done with the knowledge or blessing or resistance of those partners?

  57. says

    @ Dan — My guess is that there’s very little (or probably no) communication between airlines prior to award chart devaluations.

    In this case it should have the opposite impact — fewer people will be redeeming miles for travel on partner airlines given the higher redemption costs.

  58. Tom says

    Hey Lucky – Have the stopover/open jaw rules changed on rt awards? Having one of each is one of my favorite parts of the old chart.

  59. aw says

    isnt the worst change not the miles reqd amount,but stopovers only being allowed on
    non open jaw return tkts?

  60. Don says

    They also seem to have (mostly) closed the trick that allowed for Oceania->Australia OW trips for 25k, now 40k. Most locations in Oceania are close by to NZ/Australia, but Guam usually routes GUM-KIX/NRT-SIN/BKK-AKL/SYD/MEL, meaning 25k for a 4hr hop on a 738 and two long-haul Singapore Airlines flights in business. Still a decent deal at 40k though considering.

  61. Jacob says

    @Lucky: I think to south Asia is actually +120,000 roundtrip for F.

    Since it’s currently 70k in F one way, and would be 130k after January.

  62. DJ says

    rather than improving themselves (to approach the level of their partners so people will fly their premium cabins) they force us to accept their products – the “new normal” way of life. you know where it’s from, get used to it.

  63. DJ says

    @Paul
    “They DO NOT want credit card collectors flying in their premium cabin. They are tired of seeing pictures of their napkins, soaps, socks, etc… on blogs. People that pay for those seats probably complained so they sent the message. Got it?”

    Never thot about this before, but can be a valid point. since UA’s own is not so bad, so the complains must come from their partner airlines.

  64. E says

    Do you have a logistical suggestion changing a pre-deval one way ticket into a roundtrip for an account with 0 miles? Don’t really want to transfer the UA miles via UR until the old miles rate can be confirmed..

  65. says

    @ E — You can always call to make the change, and once the agent quotes you the price you can transfer the miles, since it should be instant.

Trackbacks

  1. […] If you haven’t heard, United miles are devaluing after January 31, 2014. You still have a chance to use your United miles before the devaluation date to book an award up to January 2015. Here is a summary of the United miles devaluation. In the bold are the major increases for Star Alliance partners (roundtrip prices) that Lucky writes: […]

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