Is This American’s Most Offensive Award Pricing Ever?

Over the past few years we’ve seen a countless number of airline award chart devaluation across various programs. Those of us who try to maximize our miles & points always try to redeem at the saver award level whenever possible, though the reality is that a vast majority of people aren’t good at redeeming miles, and many awards are redeemed at the non-saver level.

While the cost of saver awards has gone up significantly, there has been an even more drastic increase in the cost of standard awards. It used to be that most airlines offered last seat availability on standard awards for roughly double the cost of saver awards. All things considered that’s a pretty solid deal, given how much airlines could sometimes otherwise sell those seats for.

But over the years we’ve seen the cost of standard awards go up and up and up and up. Not only do many airlines not offer last seat availability on standard awards anymore, but in some cases the award costs are just insane. For example, could you imagine redeeming 375,000 AAdvantage miles for a one-way business class ticket from Los Angeles to Sydney? Ouch!

While that’s about as many miles as American will charge for a one-way business class award, it’s not the most offensive award cost, in my opinion. Reader Jeff emailed me to share the absurd award prices that American is trying to charge between San Francisco and Los Angeles on the Sunday after Thanksgiving.

Paid tickets start at $133 one-way, and go all the way up to $297, which is the cost of a refundable ticket that day. Meanwhile first class tickets cost between $233 and $397, which is the cost of a refundable ticket.

Are you ready to see how many miles American wants to charge for those flights? I hope you’re sitting down.

That $133 one-way ticket would cost you 75,000 AAdvantage miles. When you factor in that you still have to pay $5.60 in taxes, that means you’re redeeming 75,000 AAdvantage miles for a $127 ticket, getting you ~0.17 cents per mile. Usually I’d hope to get at least 1.5 cents of value per mile, but here you’re getting about a tenth of that.

If you want to snag that $233 first class seat, that would set you back 100,000 AAdvantage miles. I guess in comparison it’s almost a bargain.

I get this is a peak travel period, and I get that American could probably otherwise sell those seats. However, there has to be a balance between trying to provide members with value through AAdvantage and minimizing costs. This is especially true given how many members would love to redeem their miles to see family over the holidays. You know they’d have a positive impression of the program if their miles helped them make that happen.

As much as we rag on Delta SkyMiles, at least those miles could be redeem for one cent each towards the cost of a ticket, meaning you’d be paying a fraction of what American is charging.

Even if you don’t want to redeem your Delta miles for one cent each towards these tickets, the SkyMiles award costs for that date are 22,500 miles in economy and 27,500 miles in first class.

Bottom line

While I’m not a fan of it, I get why airlines have kept increasing the limit on how much standard awards can cost. However, there’s a difference between an airline charging a ton of miles when a ticket would otherwise cost thousands of dollars, and when an airline is charging a ton of miles for a ticket that would be quite inexpensive.

Not only is American’s saver level award availability on their own flights limited, but their standard award pricing is downright punitive and illogical in some cases.

Can anyone find a worse use of AAdvantage miles than this?

Comments

  1. Is this perhaps a bug unless AA started some new dynamic pricing ala DL and not tell anyone.
    I’m guessing this is a bug since according to the AA award chart AAnytime Awards, even at the highest level (I’m not sure what makes something L1 vs L2) is 30K:

    https://www.aa.com/i18n/aadvantage-program/miles/redeem/award-travel/flight-award-chart.jsp
    Contiguous 48 U.S. states TO:
    Main Cabin
    To: MileSAAver
    Off Peak MileSAAver AAnytime Level 1 AAnytime Level 2
    Contiguous 48 U.S. states – Not available 12,500 20,000 30,000

  2. hmm looks like my previous comment got removed, perhaps because it had a link?

    Anyways I’ll try again sans link, The award chart for AAnytime awards from US48-US48 tops out at 30K miles o/w (go to AAs website for the chart) there are 2 AAnytime levels 1 and 2 and 2 is 30K so this might be a bug. That said, I’d add this post reminded me that I should really book my tday flights home — thanks!.

  3. You are so right. Add insult to injury — even Exec Platinum and Concierge Key status gets you no additional inventory. Compare to United with plentiful Y/C/F saver and standard awards on most routes with plenty of options. What’s up?

  4. Can’t wait until the next industry down cycle when management teams are compelled to find ways to explain why customers “no longer seem to show loyalty” after neutering their rewards programs.

  5. youre missing the point. they dont want you to use points. they want the cash, and for you to hold the points because they know they will devalue them away down the line. Its just a way to fulfill a marketing slogan ‘seats always available’

  6. (2) We went 25 years + without a devaluation. Now that they know they can get away with anything, we will see devaluation annually as we have been seeing, &/or outrageous dynamic pricing. Eventually as the airlines get the liability off the books, the the FF programs will shrink greatly in impact or disappear completely.

  7. AA has destroyed the value of their program. This is exactly why my dad (formerly a Concierge Key with AA, and Executive Platinum for about 9 years straight), on my advice, now flies UA instead – even after moving from a UA hub to one where both UA and AA have hubs. The revenue lost to AA just from him is close to $100K.

  8. @Evan Actually I think airlines would be THRILLED if someone used points on SFO-LAX, even more so at the rates above. It moves a crapton of miles off their books and does so at very little cost compared to say an F award to HKG on CX which is about the same price as the AAnytime F award SFO-LAX above.

  9. @Ryan, the award chart generally does top out as you suggest, but AA has this on that page:

    “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.”

    Details, details, details….it might be more than a full time job to keep up with just the policies of one airline.

  10. The message of this post is certainly on point, but there is at least one implication that I think we all need to at least recognize. I am not defending the point that award costs have been on the rise. However, the award chart and dollars for tickets are monetized or priced very differently.

    The 75K level for Anytime US48 awards is effective on any route at that “price.” Using it on a short haul flight or rather a flight that otherwise is cheap in dollars would be unwise. SFO-LAX, OKC-DFW

    The same 75K award will get you on an otherwise higher priced (in dollars) route. It applies to SFO-BOS, or SEA-EYW.

    The award pricing is set for that day at “that” award level. It matters not how many legs or the distance, or the market “dollar” value. On days that the price is 20K, that too applies to all routes within the US48. My point? Know the rules and use them to your advantage. Pay dollars when it makes sense. Use miles when that makes sense. The use of the Anytime awards often make the most sense on same day travel, or on any otherwise costly ticket. Using a 75K award on an otherwise $100 ticket is unfounded or unjust on the face, but the real stupidity would be the consumer who chose wrongly.

  11. @Jeff Shilling ha right you are…that is a bit sneaky so they haven’t gone full Delta but have given themselves the option of pulling a Delta when it suits them!

  12. When planes are full and profits are huge, airlines have little incentive to reward loyalty. This will not last forever. Its like in the Game of Thrones. Winter is coming. And I think it will be sooner than later. We are already seeing softness is many sectors. GDP growth is shrinking, uncertainty is growing.

    While most of the flights I have been on have been completely full this year, I was surprised to get an upgrade on a BNA to JFK flight on AA midweek this month. The reason? There were only 17 passengers on the plane. Granted, Sunday after Thanksgiving is probably the worse day EVER to fly on revenue or on points.

  13. Yeah its nuts , so dont use your pts, its rather simple. No airline ever promised that there would always be Saver space available

    I can just see all the bloggers going nuts if AA simply didnt offer any awards at all. Guess they cant win no matter what they do

    Its rather simple either dont fly AA or use a Barclays or Citi AA CC, so that you wont have AA miles that cant be used

    I find that with the Hotels as well, where they want a bucket of pts for a free night or < $100.

    that said there are folks out there that charge millions a year to their CCs be it their own business or they have a company position where they can use their own CC, and they cant sell the miles/points since if they get busted it will cost them too much. So whatever they can save $$ wise they see as a benefit and the programs know this

  14. Shameful. It’s been years since I was able to redeem at saver level for a domestic flight. I’m burning my AA miles on partner awards, as there own medal outside of the rare occasion is a horrible redemption.

  15. That award chart to Sydney looks like bliss to this Delta Hostage

    Cheapest I can find LAX to SYD is 400k miles

  16. ‘Now we have a special offer for you. If you sign up for the disAAdvantage card inflight today, upon approval, you will receive 60,000 miles !!! That’s enough, enuf, eh, almost enough for a one-way economy ticket from LA to SF.’

  17. I’ve just given up on renewing Exec Platinum this year. I’m diamond on Delta, AA just isn’t doing anything to keep me. It’s unfortunate the glory days of AAdvatage seem to be over.

  18. @Ryan Sort of/not really. Its self-evident – obviously they know that few or none will be dumb enough to do redeem in this example. If they wanted more redemptions, then of course they’d price them more attractively.

    Of course they’d be happiest if no one ever redeemed anything, right? Zero cost! In effect we’re heading that way, and why not? They can decide to wipe the books of the liability by scheme of expiration or devaluation if they want in the future. The T&C on these programs are clear – they aren’t savings accounts, the airlines can do whatever they want at any time without consumer recourse.

    You say you’d take them to court, you want this regulated? Then eventually we will all be paying income taxes on the value of the redemptions. The game would be crushed under the weight of the tax burden.

    Unless the economy really goes bad – and I certainly don’t want that, even to spite my least favorite airline – IMO FF programs will be “sunsetted” once the value to airlines is mostly eroded. It’s closer than you think.

  19. @Daniel. I am with you. Surprised that cash prices are so low on that day four weeks out.

    Ben, while I agree with you generally that the value of redeeming AA miles on AA metal is low, I think this example loses sight of the bigger picture. The real issue is that the Sunday after Thanksgiving is one of busiest–if not the busiest–travel day of the year, and that is one of the dates AA charges extra miles. I would bet that every domestic route is 75,000, regardless of what the price of a paid ticket is. Now we can disagree on the merits of that, but personally, I think I would prefer AA redemptions not be linked to the cash price of a ticket. Put another way, I bet few of us were going to redeem miles for SFO-LAX anyways; however, if the price of an award ticket were generally correlated with the price of a revenue ticket, we would probably be much more deeply offended.

  20. Meanwhile I just last week redeemed 7500 miles for a trip from BWI to JFK 2 days before the flight that was pricing out at $448. I was also able to book a 2 round trip reward seats in business class from JFK to Zurich in the height of Ski season in Feb 2018 for a total of 105K. (115 plus 10k back).

    Guess I should consider myself lucky.

  21. I think what Hilton or Air Asia are doing is better in comparison: when “saver” awards are not available, they move to a revenue based redemption with a fixed point value – that’s still better than this..
    I know revenue base redemption is a four letter word, but at least you don’t get this kin of ridiculous pricing…

  22. It’s outrageous but I remember blackout dates and so I view this as an updated version of that old ploy. Back in the 80’s and 90’s the airlines had more blackout dates than award dates and popular routes were virtually never available. Redemptions have come full circle.

  23. Do you honestly think someone with hundreds of thousands of miles would even consider not spending a hundred or two hundred dollars instead? Similarly for the SYD example. Yes it may be rediculous to post such high amounts of miles but in reality would anyone even opt for such a redemption?

  24. On some airlines these dates would be blacked out for awards. That being said we all rag on legacy US Air but at least with US Air you could find and use 60k for roundtrips to europe in business. AA saver award space is a joke and is ruining the company for many loyal customers.

  25. IMO, theyre tryinng to incentivise people to book cash tickets during this period on this sector. Just a wild guess, nothing to back it up.

  26. Agree with other comments here, they should simply black out that date rather than insult their customers with those prices. Maybe “AAnytime” can be “anytime…with exceptions.”

  27. I checked Delta award travel for my kids on the Sunday after Thanksgiving and the award tickets were also coming in under 1 cent per mile.

  28. Well the game only last so long. ✈️

    Looking at these LAX-SYD amounts, I guess I should be happy with my ‘backup’ reservation DCA-LAX-SYD in Business for #RTW17 at 195,000 AA miles. I say backup because my preferred routing is on Korean in 1st JFK-ICN-SYD for just 110,000 (actually 90k cause I transferred in from SPG ) My positioning DCA-JFK on AA in 1st for $156. If it doesn’t look like Korea will get blown up before Nov. 10, I’ll cancel the AA backup for $150.

    BTW #RTW17 continues SYD-AUH in Apartment 4K for 90,000 AA miles (100,000-10,000 for CC rebate) then 1st AUH-IAD for 120k Etihad miles (no AA reward availability).

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