As part of the merger with American, US Airways Dividend Miles changed the way they sell miles. Previously they would offer a 100% bonus on purchased miles more often than not. It was an easy way to pick up US Airways miles for ~1.88 cents each.
Buying US Airways miles was a great way to book Qatar Airways business class
In late October, US Airways unveiled their first Buy Miles promotion under the new scheme, which expired yesterday, November 12, 2014. The best you could do was pick up miles for ~2.3 cents each, so that wasn’t all that exciting, especially in comparison to what we were used to.
American and US Airways Buy Miles promo through November 30, 2014
Well, US Airways is testing the waters with their new pricing scheme quickly, as both American and US Airways have released a new Buy Miles promotion, valid through November 30, 2014:
The first thing that US Airways did is lower the “base” cost per purchased mile. Previously US Airways charged 3.5 cents per mile (before any bonuses and tax), while now US Airways is charging 2.95 cents per mile, which puts them in line with American AAdvantage.
Through this promotion, both American and US Airways are offering tiered bonuses on the purchase of miles, as follows:
10,000-19,000 miles = 3,000 more bonus miles
20,000-29,000 miles = 6,000 more bonus miles
30,000-39,000 miles = 10,000 more bonus miles
40,000-49,000 miles = 15,000 more bonus miles
50,000-59,000 miles = 20,000 more bonus miles
60,000-69,000 miles = 30,000 more bonus miles
70,000-79,000 miles = 35,000 more bonus miles
80,000 miles = 45,000 more bonus miles
Dividend Miles promo
If you max out the bonus you can purchase a total of 125,000 miles for $2,572 including taxes and fees.
Dividend Miles Buy Miles cost
AAdvantage Buy Miles cost
That’s ~2.06 cents per mile, which is much better than the offering during the last promotion, though also not as good as ~1.88 cents per mile.
Interestingly, despite all this aligning, American still limits the number of miles you can purchase per calendar year to 80,000 (before any bonuses), while US Airways has no limit on how many miles you can purchase per calendar year.
For both airlines, accounts less than 12 days old aren’t eligible to purchase miles. Also, both airlines process mileage purchases through points.com, so buying miles wouldn’t count as airfare for the purposes of credit card spend.
Which are better: American or US Airways miles?
AAdvantage and Dividend Miles will continue to be run separately through the second quarter of next year, at which point the programs will be combined. So even though the promotions are basically identical, the programs are still very different. Each program has different award chart “sweet spots.” AAdvantage allows one way awards for half the cost of a roundtrip and has more generous change policies, while US Airways has more generous routing rules.
Here’s a post I wrote a while back comparing the value of miles in both programs, for what it’s worth. I don’t think there’s one currency that’s more valuable across the board — it all depends on your specific needs.
Should you buy miles?
~2.06 cents per mile isn’t a rate at which I’d speculatively purchase miles. But with a specific use in mind, it certainly could be worthwhile. For example, through US Airways Dividend Miles, 120,000 miles is enough for Cathay Pacific first class roundtrip ticket between the US and Hong Kong, so for ~$2,500 out of pocket that’s still a heck of a deal.
Both American and US Airways let you hold award tickets even without enough miles in your account (for five and three days, respectively), so that can be a great way to lock in the award you want before having to pull the trigger on purchasing miles.
It’s clear the “new” AAdvantage is still trying to find the sweet spot for selling miles. Selling miles has been big (and profitable) business for Dividend Miles, so I think they’re still trying to find the balance between generating revenue from it without devaluing the currency. And I think the fact that they’re offering back-to-back promotions mid-month, and decreasing the cost per mile in the process, tells us a lot about the response to the increased cost in purchased miles.