Official Clarification: Did American Actually Raise Award Rates Last Week?

Last Friday I posted about how American seemed to suddenly increase their “AAnytime” award costs on some routes, including between New York and Los Angeles/San Francisco. AAnytime awards are the higher award levels you can book when there’s not saver level award space available, and over the years the cost of these awards has gone up significantly.

American-Award-1

It used to be that these higher level awards cost twice as much as saver level awards, but that’s actually where we’ve seen the most award inflation. I can’t blame airlines for this, as these award seats are also potentially the most costly to them. That’s because people can use miles to book the last seat on a plane when it might otherwise be sold to a full fare customer (that’s much more costly than someone booking a saver award a year out, where airlines can optimize their revenue/inventory management as a result).

With that in mind, an American spokesperson was kind enough to reach out and clarify that American did in fact “shuffle/optimize” the existing award levels valid on flights between NY and LA/SF.

Here’s what the spokesperson had to say, in part:

We’ve had award levels higher than level 1 and 2 since we announced the new AAnytime program in April 2014.  This information is disclosed on our award chart – “There are select dates that require a higher number of miles (in addition to Level 1 and 2 awards).”

All these levels already existed and have been around since the summer of 2015.

During the course of the year, to better match demand, we also regularly shuffle/optimize the existing AAnytime levels that are valid on flights. Last Monday, this is exactly what was done with JFK-LAX and JFK-SFO — no new levels were added.

So here’s the problem. I fly American well over 100,000 miles per year and write about airlines/loyalty programs for a living. I’d like to think that AAdvantage is the single program I know the most about. Despite that, I can’t really make sense of this anymore. Perhaps that’s a clear answer as to whether or not the program is headed in a dynamic pricing direction or not.

To summarize the situation best I can, in April 2014, American greatly increased the cost of many standard awards. They went from having one standard award level (typically double the cost of a saver award), to having two published standard award levels.

American-Awards

American has had the disclaimer saying that a higher number of miles may be required for travel on select dates:

AAnytime award levels vary by date and region. There are select dates that require a higher number of miles (in addition to Level 1 and 2 awards). When you search for awards while booking, you’ll see the applicable award level.

However, in June 2015 American gave advance notice of increasing standard award costs for four of the busiest travel days of the year. Since American supposedly already had a higher award level that wasn’t published, I’m not sure what purpose the notice of increased prices for four days of the year served, exactly.

But now I guess I understand the motivation behind that. They increased standard award prices for four days to establish the new higher levels, and now can say that charging those prices many days of the year doesn’t represent a new award cost, but rather represents them “shifting/optimizing” the existing levels.

American-A321-First-Class-02

Well, I think it’s now official: the AAdvantage program has become too complicated for me to fully understand.

Comments

  1. American is the worst. They don’t even offer Zika waivers unless you are the person pregnant. Please write about this terrible policy. They don’t care about our public health.

  2. Ironically I booked a NY/SFO flight this week for late November. When I called to get on the wait list with my SWU the EP agent kinda laughed. She basically said good luck getting the upgrade because they are having no problems selling especially the business class seats. Flew the route last week and there was only 1 upgrade so she is spot on.

  3. Ughhh so basically it sounds like AA is moving more towards the Delta model. Why even have an award chart then? (Clearly Delta doesn’t think one is necessary anymore!)

  4. I had been watching ORD-OGG and the standard O/W award was 90k on the day i was looking for. When i looked this week it was 125k. Was the highest standard US48 – Hawaii always 125k or did they increase that too?

    ORD-OGG on Nov 11th has the first standard award from 67.5k to 125k (though the 125k has the phx-ogg segment as business). Maybe thats an issue on that day.

  5. being based out of PHL often makes me jealous of the NYC folks in terms of the variety of airlines and airplanes at their disposal, BUT i’ve noticed that AAnytime pricing to/from PHL often beats NYC. just booked a PHL-SFO one-way for 20k only 13 hours before take-off. Cash price was $792. Pretty solid value. And came with MCE seating on-the-house whereas otherwise, as a non-elite, i’d have to pay $75 for it….so…AAnytime awards are still “worth it” sometimes.

  6. An entirely revenue-based redemption scheme will instantly kill off any aspirational awards. This is the only reason why I nearly never travel on WN VX B6 unless they’re dirt cheap.

    I don’t fault AA for charging more miles for peak-demand flights (this is the “full miles” version, not the saver), but a revenue-based scheme will also kill the chance for an airline to clear distressed inventory, particularly in the premium cabin.

    e.g. if a J cabin is only at 50% at T-24, including all those waitlisted for upgrades, more likely than not the airline won’t fill the rest of it with 24 hours to go on an average day.

  7. @henry LAX – now with AA’s revenue-based earning, how much are you going to earn flying AA? I’ll keep earning my miles through credit cards and my flights are now all on (a) best non-stop convenience and timing and (b) price.

  8. @AnonCHI – my primary airline isn’t AA, but since all airlines other than AS is revenue-earning, that’s basically moot already. AA still retains value by allow reasonably priced J awards on quality partners like CX JL EY QF etc. Take that away and I’ll treat them the same way I treat B6.

    The issue with AS is that they don’t allow mixing partners in awards, so you’re really restricted when you need more creative routing solutions to circumvent saver space inventory issues.

  9. This is why I dont do this,ie its too complicated Id rather read Ben’s posts on which FC/BC fares are cheap and FYI American becoming a terrible carrier

  10. Ben, it’s time for you to stop being the AA fanboy. I understand they have to do what they have to do. You have to do what you have to do. If that means being a free agent, you do it. They’re not showing the love for you being loyal.

    I was an EXP for 11 years. I gave up on them. I decided to shoot for oneworld Emerald with another airline. I couldn’t be happier with the decision.

    The premium fares these days on US domestic flights are fairly reasonable, thanks to B6 and others. If I want to fly in the pointy end of the plane, I’ll buy it if it’s reasonable enough. Why hope for an upgrade? Those days of free upgrades for EXP are coming to end.

  11. The relevant issue is different prices for different flights on the same day. They didn’t used to manage AAnytime pricing by flight. One day has one AAnytime price.

  12. But this doesn’t answer the question as to why there is a difference standard award pricing for the same city pair, but different flights, on the same day.

  13. Tony, which OW airline did you switch to? I’m also looking to do the same thing in the coming year.

  14. UAL is the clear winner here. Standardized pricing, a good group of partners, an improved business class product on their own metal (eventually), and a new CEO that clearly wants to make things better. Even with the upcoming routing changes, they still allow stopovers and they provided more than adequate notice that a change was coming. They have my trust and my loyalty.

  15. @Francois I switched to CX. It’s not easy, but you can find ways to make it easier to get Emerald. Their unpublished benefits are what stand apart from the other oneworld airlines.

  16. I used to get a “free” (award still charges taxes…) every 4 or maybe 5 paid trips to Montevideo/Bs As. Now I need at least to buy (full pay) at least 8 trips to obtain enough miles for “reward” flight.
    Anf fuel is cheap but tickets cost more, and planes are full. !

  17. Isn’t this how US Airways was ran? I wouldn’t be surprised if AA dumped one way award redemptions.

  18. I’d suspect that Doug Parker had just farmed out Advantage to Delta except that Advantage is significantly worse than SkyPesos now.

    From DC I just drive up to PHL to get anything decent.

  19. @Gary Leff
    Agree that is the relevant issue. Is it all that surprising that the premium flights on a given date would require more miles since the premium flights generally cost more dollars than the normal ones. Maybe I’m missing something here. I’m just grateful to be able to get access to a premium award flight even if it cost more miles. Most of the time, only the flights with horrible routing and times are offered.

    Overall, I agree that the program is getting weaker by the day. Everyone I know are exploring other options. AA needs to stop the bleeding…..

  20. “Well, I think it’s now official: the AAdvantage program has become too complicated for me to fully understand.”

    Simple. Eloquent. And sadly true.
    One question: Is it worth status challenging to another airline before going free agent? And if so, which one?

  21. The devaluation of American status and miles is the last straw for me. Earning 27% less miles than I was receiving for coast to coast travel means American will lose all my business. I rarely get upgraded as Platinum and the benefits have just decreased to the point where its time to find another supplier.

  22. I’m currently on a Delta–yes, Delta!–status challenge from AA Plat. For me the biggest drawback on Delta is the lack of free E+ at booking, meaning paying extra up front for Comfort seats or else risking a middle seat, never a good idea. But after 3 Delta segments (plus 2 Air France/Hop!) I’m pleased enough with the overall experience to plan on meeting the challenge requirements. I did not feel this way after a United challenge.

    Traveling on an economy budget, so far I’ve found the quality of Delta’s equipment, food, lounges, and employee attitude all a significant improvement over AA. The few years of ExP were fun, but I’m no longer flying 100k miles/year. AAdvantage’s most recent changes destroyed any remaining inventive to put up with their second-rate product.

    (granted, I have yet to see how Delta handles irrops, but AFAIK none of the big 3 gets high marks in that department)

  23. AA just greatly raised the paid price for business class in the JFK/LAX/SFO flights as well (following Jet Blue perhaps?)

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