Ugh: Delta SkyMiles Makes Another Partner Award Devaluation

Delta SkyMiles just really can’t help themselves, can they? Delta doesn’t publish award charts, so we usually only find out about devaluations through trial and error. For that matter there’s really never a way to know whether something is wrong with SkyMiles award pricing or not, because “the price is the price.”

In April Delta massively devalued SkyMiles redemptions, as they raised the cost of premium cabin award tickets on partner airlines. Rather than charging the same number of SkyMiles regardless of whether you’re redeeming on Delta or a partner airline, they created separate pricing when traveling on a partner airline.

For example, the cost of business class partner award tickets increased from 70,000 miles to 85,000 miles between the US and Europe, from 80,000 miles to 95,000 miles between the US and Asia, and from 95,000 miles to 115,000 miles between the US and Australia.

On top of all that, around the same time Delta introduced variable award pricing for travel on their transatlantic joint venture partner Virgin Atlantic. When booking close to departure (seemingly within 21 days of departure), the cost of many Virgin Atlantic awards increased significantly. For example, take the below Upper Class flight between Boston and London, for which Delta SkyMiles is charging 135,000 miles one-way. That’s an insane number of miles to charge for a saver level award ticket.

While Delta has always had variable pricing on their own flights, this was the first case of them introducing variable pricing on partner airlines.

As noted by Point Me to the Plane, it looks like that was only the beginning, as Delta SkyMiles has now introduced higher award costs when booking partner airline awards close to departure.

In searching for nonstop award availability between San Francisco and Shanghai on China Eastern, here’s what pricing looks like:


China Eastern 777 business class

As a reminder, the cost should always be 95,000 miles, but now close to departure they’re sometimes charging 125,000 miles. That’s an extra 30,000 miles one-way for booking close to departure.

It seems like this is being charged when booking between roughly five and 21 days before departure — the higher amount doesn’t seem to be charged when booking just a few days out, which is a bit odd.

The same is true between Taipei and San Francisco on China Airlines:


China Airlines 777 business class

And just to be clear, when you click through the higher pricing is indeed reflected, so this isn’t simply a calendar glitch.

Since there’s no transparency at SkyMiles, we don’t know if this will apply on all partner airlines under all circumstances, or what.

Unfortunately Delta SkyMiles continues to look at their program completely wrong. The program is being run as if it’s revenue management, which makes no sense. I understand for revenue tickets airlines often charge the most for last minute tickets, since people are also willing to pay the most. However, the opportunity cost to an airline making saver award seats available is unarguably the lowest last minute. There’s the least opportunity cost to sticking someone in a seat that would otherwise go empty, which is presumably the case if the airline makes award seats available within a couple of weeks of departure.

Oh SkyMiles…

Comments

  1. So between AlItalia’s Millemiglia going down (Transfer partner of Canadian AMEX), and Delta devaluing, do you have a preferred Skyteam points program?

    I fly Skyteam at most a couple of times a year (Eastern Canada is mostly Star Alliance world), so miles that don’t expire would be ideal.

  2. While 95,000 or 125,000 Skymiles is still too many, might it be that there is simply no saver level availability on the days that display 125,000?
    Quite frankly, for saver level that seems like a lot of availability less than 30 days out. Of course. almost any flight that requires 95,000 miles(saver level or not) one-way seems exorbitant.

  3. And at a time when China Eastern economy fares ex-USA are costing basically nothing! The number of markets available in Asia ex-USA at circa $450 r/t on China Eastern is mind-numbing.

    So why Delta why.

    PS I wouldn’t burn my Skymiles on C.E. biz class, that’s for sure

  4. Why does each calendar have low level availability on 9/4, which is earlier than the other two weeks? Doesn’t seem to make sense if they’re charging for close-in avail

  5. While I don’t like it, the plan makes sense. Award redemptions on last minute flights can be attractive alternatives to paying last minute air fares. It’s how I use a lot of miles. I assume Delta would rather steer the customer to buying the revenue ticket and away from the award redemption.

  6. But it is revenue management. Your argument that the airline should be most desperate to sell a ticket shortly before departure could just as well apply to cash bookings, too, right? The reason it doesn’t is because the airlines want to train people to book in advance so they can charge more to those who have an urgent need to travel at the last minute, usually business travelers.

    And there are lots of small business owners who will consider using miles to book travel instead of cash, so for those people, they were getting a deal on last-minute travel.

    You may not like this, but it makes perfect business sense to me.

  7. Hi Ben
    Frankly, as a European based reader, I always got the impression that you guys based in the U.S. can hoard on miles in a very too easy way.
    These changes are simply the reflection on balancing earn vs. spend

  8. @Bgriff,

    I completely understand what you’re getting at since you could easily just presume miles are a currency. However, I think Ben’s point is that seemingly few last-minute trips are booked with miles in the miles/points game. Those last-minute miles/points bookings are usually the result of someone having a flexible schedule, a lot of miles/points, and the desire to snatch seats that would otherwise be going out empty but are being given away at a discounted miles/points price. That being so, it makes little sense for close-in booking with miles/points to be outrageously expensive.

    I’d posit that last-minute trips are generally the result of urgent business dealings where a company is likely paying the fare. In that case it makes perfect sense to gouge customers because they *have* to be somewhere on short notice and are willing to pay. But miles/points users tend to plan their use of the miles/points currency so as to not waste them on silly award redemptions.

  9. I think it’s worth noting that there were other more positive changes too. I was searching for DCA-JFK and found them at 5500 each way, which seems way lower than my memory serves and lower than in travelisfree calculator. Also, routes for PWM-DCA were at 7k each so not sure if new or I’m just noticing these power domestic fares.

  10. Maclover +1 !!!
    I am still amazed how many creditcards an American can apply for and earn points and bonuses on.
    It is so d@mn easy to collect points living in the US. That is also why it is so d@mn easy for airlines to devaluate as most of you sit on tons of points. For us mere Europeans collecting points is done by actual flying.
    For me trying to get a ticket on points in C-class means flying one alliance multiple flights per year for a few years.

    So why do airlines devaluate their points? Because it is too easy to collect them!!

  11. To be fair, United charges a close-in booking fee if booked within 21 days of departure… though 30,000 miles is worth a lot more than the USD $75 United charges to non-elites. (And this pricing applies to elites as well…)

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