AAdvantage announces award chart changes for March 2016 onward – Australia gets off a bit lightly, other regions cop it

Overnight American Airlines announced a range of program changes to AAdvantage, and published their new award charts for redemptions for bookings from March 22nd, 2016. They also announced new AAdvantage mile earn rates based on fare revenue. The cost in miles of travel to and from most regions increases by at least 30% in Business Class. Some of the key routes for Australians and New Zealanders aren’t changed too much, while other routes increase dramatically. Given AAdvantage’s aggressive selling of miles of late, you may be impacted to varying degrees if you’re sitting on an AAdvantage balance (like me). Many US bloggers are going a bit nuts (with some justification) over the changes, although most people who had kept informed on the goings on in the loyalty world knew this was coming. Complaining about it now seems like having a bit of a whinge over the inevitable, to be honest – however some changes are maybe more dramatic than you’d hope for. Personally, I’m pleased that the Asia Business Class redemption pricing out of Australia is relatively unchanged. This is a key target route for redemptions for many. Heading further afield to Europe or the US and the cost changes are much more marked. I won’t cover the mileage earn side of the changes as that’s only relevant for a small slice of Australian frequent flyers, and those changes are discussed in a far more informed manner on many other US-based sites.

What are the most relevant changes for Australian travellers?

There are now two sets of award charts for AAdvantage redemptions

1. One for bookings made up until March 22nd, for travel on American, or travel on partner airlines
2. Another for bookings made after March 22nd, for travel on American, or travel on partner airlines

American’s charts are zone-based, and priced by originating region (where you start your flight). To keep things as simple and relevant as possible, I’ll only look at the changes for Australia to/from other regions, and for the partner award chart. You can click through to see the full changes in the two sets of award charts above if you have a specific change you want to look at outside of these. I’ve reworked the numbers to look at the changes between the old and new charts for flights from Australia, below. All costs in the following tables are for one way flights.

Destination Region	Economy (current)	Economy (2016)	Business (current)	Business (2016)	First (current)	First (2016)
Contiguous 48 U.S. states ^	37500	40000	62500	80000	72500	110000
Canada and Alaska^	37500	42500	62500	82500	72500	112500
Hawaii^	37500	37500	62500	65000	72500	90000
Caribbean^	37500	45000	62500	82500	72500	112500
Mexico^	37500	45000	62500	82500	72500	112500
Central America^	40000	45000	65000	82500	75000	112500
South America Region 1^	40000	45000	65000	82500	75000	112500
South America Region 2^	37500	45000	50000	82500	75000	112500
Europe	45000	60000	60000	85000	80000	115000
Middle East / Indian Subcontinent	30000	42500	45000	80000	60000	100000
Africa^	37500	42500	50000	80000	75000	100000
Asia Region 1	30000	30000	45000	40000	60000	60000
Asia Region 2	25000	30000	35000	40000	45000	50000
South Pacific	20000	15000	30000	30000	42500	–
Fiji (internal)	7500	5000	12500	10000	–	–
Australia (domestic)	10000	10000	17500	20000	–	–
New Zealand (domestic)	10000	removed	17500	removed	–	–
Australia – New Zealand	10000	15000	17500	25000	–	–

Digging into Business Class, here’s the difference along with the % change:

Destination Region	Business (current)	Business (2016)	Difference	% Change
Contiguous 48 U.S. states ^	62500	80000	17500	28%
Canada and Alaska^	62500	82500	20000	32%
Hawaii^	62500	65000	2500	4%
Caribbean^	62500	82500	20000	32%
Mexico^	62500	82500	20000	32%
Central America^	65000	82500	17500	27%
South America Region 1^	65000	82500	17500	27%
South America Region 2^	50000	82500	32500	65%
Europe	60000	85000	25000	42%
Middle East / Indian Subcontinent	45000	80000	35000	78%
Africa^	50000	80000	30000	60%
Asia Region 1	45000	40000	-5000	-11%
Asia Region 2	35000	40000	5000	14%
South Pacific	30000	30000	0	0
Fiji (internal)	12500	10000	-2500	-20%
Australia (domestic)	17500	20000	2500	14%
New Zealand (domestic)	17500	removed
Australia – New Zealand	17500	25000	7500	43%

And the same for First Class:

Destination Region	First (current)	First (2016)	Difference	% Change
Contiguous 48 U.S. states ^	72500	110000	37500	52%
Canada and Alaska^	72500	112500	40000	55%
Hawaii^	72500	90000	17500	24%
Caribbean^	72500	112500	40000	55%
Mexico^	72500	112500	40000	55%
Central America^	75000	112500	37500	50%
South America Region 1^	75000	112500	37500	50%
South America Region 2^	75000	112500	37500	50%
Europe	80000	115000	35000	44%
Middle East / Indian Subcontinent	60000	100000	40000	67%
Africa^	75000	100000	25000	33%
Asia Region 1	60000	60000	0	0%
Asia Region 2	45000	50000	5000	11%

And then the relative change in miles cost between the old and the new pricing, for First & Business Class:

Destination Region	Business Class % Increase	First Class % Increase
Contiguous 48 U.S. states ^	28%	52%
Canada and Alaska^	32%	55%
Hawaii^	4%	24%
Caribbean^	32%	55%
Mexico^	32%	55%
Central America^	27%	50%
South America Region 1^	27%	50%
South America Region 2^	65%	50%
Europe	42%	44%
Middle East / Indian Subcontinent	78%	67%
Africa^	60%	33%
Asia Region 1	-11%	0%
Asia Region 2	14%	11%

The key changes for travel from Australia…

The good, or minimally affected:

• Australian domestic goes up from 17,500 miles to 20,000 miles in Business Class
• Australia to Asia Region 1 and Region 2 are normalised to the same price in Business Class – 40,000 miles, an increase of 5,000 miles for Asia Region 2 and a reduction of 5,000 miles to Asia Region 1
• Australia to Hawaii in Business Class increases by 2,500 miles only, not that it’s easy to find award space with Qantas
• There’s no change for Asia Zone 1 in First, and an increase of 5,000 miles for Asia Zone 2
• There’s no change to the South Pacific region, meaning flights to Fiji or The Pacific Islands more generally are left alone

The bad, for Business Class:

• Australia to NZ goes up from 17,500 to 25,000 miles. I can understand this for Perth – NZ flights, but for East Coast to NZ, this is bad.
• Australia – Middle East/India increases by over 75%
• Australia – Europe increases by over 40%
• Australia – USA, Canada, Carribbean, Mexico, Central America, South America Region 1, increase by around 50%

Most changes are generally much, much worse for First Class redemptions.

Finally, for Etihad redemption options to the US and Europe, which required combining costs between Australia and the Middle East, the changes look like this:

Old (current) prices –

• Australia – Middle East is 45,000 miles in Business, 60,000 miles in First
• Middle East – Europe is 30,000 in Business, 40,000 in First
• Middle East to USA – is 67,500 in Business, 90,000 in First
• Total cost for Australia to Europe with Etihad is 75,000 in Business, 100,000 in First
• Total cost for Australia to USA with Etihad is 112,500 in Business, 150,000 in First

New prices –

• Australia – Middle East will be 80,000 miles in Business, 100,000 miles in First
• Middle East – Europe will be 42,500 in Business, 62,500 in First
• Middle East to USA – will be 70,00 in Business, 115,000 in First
• Total cost for Australia to Europe with Etihad is now going to be 122,500 in Business, 162,500 in First
• Total cost for Australia to USA with Etihad is 150,000 in Business, 215,000 in First

These are some pretty massive increases – American must have seen the costs they were incurring on these routes with Etihad (the only partner that needs pricing between these zones to be combined), and adjusted pricing accordingly.

What should you do if you have an existing balance?

First – there’s no need to ‘PANIC’. The changes aren’t going live for bookings until late March. But I’d maybe say panic a little less strongly, as many members will immediately try and burn their stash of miles to get the most out of their balances before the changes hit. You should consider doing the same.

• If you definitely want to use your miles within Australia / NZ or to Asia, I’d say you probably don’t NEED to do anything right now. The increases are small, and if you’re dates aren’t firm, any change fees incurred (if you need to make a change) by booking hurriedly will eat up any saving in miles you’ll make by booking immediately.
• If you had a specific use and dates in mind for your miles beyond travel to/from Asia, get researching award space.
• If you thought you’d strongly like to use them for travel beyond Asia, firm up your dates, and start looking for award space.
• If you can’t find award space, draught in some professionals to help manage your search, or consider alternative uses for the miles.

Summing up

Another day, another change in the world of points and miles. There will, inevitably, be a few people with a significant points balance impacted by these changes who will need to get redeeming to avoid the largest price hikes. Generally for some of the major routes originating in Australia, the AAdvantage pricing changes could have been worse – at least the Asia Business Class and Domestic Australia options weren’t affected, and remain fairly good value. The price increases to the Middle East and Europe though are particularly acute.

Community Comments

1. Hi Keith,
   Thank you for your earlier email.
   Do you still see it as viable to purchase AA points at this stage if was planning to travel from Melbourne to LAX or Las Vagas to a conference in November of next year ?
   I am hoping to travel Business class and as previously mention I have 320000 QFF points in stock.
   I would appreciate your input
   Regards
   Ross

   Reply

   1. Hey Ross – how many people are you wanting to fly? If it’s just you you have enough QF points without needing AA. Otherwise you know your travel dates so could look at availability now, and don’t buy any miles until you know that you have the seats on hold.

      Reply

2. A brilliant article comparing these changes to United…
   http://www.milevalue.com/comparison-of-united-delta-and-american-airlines-2016-award-charts/?nabe=5869811131219968:0

   Reply

3. And my partner calls ME a Polyanna!!!
   South Pacific changes are savage, except for SE Asia, where there is plenty of competition.
   The email from AA says it is all about adjusting to “market forces”.
   What sort of market forces it doesn’t say: oligopoly= joint ventures.

   Reply

4. I don’t believe you’ve calculated the % increases correctly.
   For example, South Pacific to Europe in J goes up by 25000 from 60000 to 85000.
   This is a 42% increase in my books (85000 divided by 60000). Whereas in your calculation it is only 29%. I don’t call this getting off lightly. It is brutal, to say the least.

   The worst is the 45k to 80k devaluation to ME. It is a 78% increase (devaluation).

   Thanks, Victor

   Reply

   1. Thanks Victor. Teach me for being in a rush. I have updated the tables with the correct % changes, and updated my commentary a little. I’m too much of an pessimist maybe, I thought we were in for an absolute gutting. No changes for Asia and minimal for Australia to me was a better than expected outcome!

      Reply

      1. You’re either an extreme pessimist or optimist Keith! 🙂

         The whole award chart (except Asia 1) has been annihilated. Across the South Pacific chart, the average increases are 33% and 42% in J and F respectively. Nothing “light” about that!

      2. My thought process was that there would be no point making any changes that are just dabbling around the edges, or would be short term in nature. This new award chart will need to last them a couple of years at least I guess, and fix up all issues they currently want to resolve in one go. As a result I figured it was going to be sweeping and dramatic, otherwise why bother. One big large jolt of pain and then all the points people will settle down to the new normal.

         Making changes at under the 25-30% level (to me) would feel like not bothering too much for. Us getting away with the Asia and Australia pricing is a nice surprise. Maybe that colours my take on the whole thing, as a result it didn’t seem too bad. But I fully admit the changes above 50% are particularly harsh. I thought we might see more of those though.

5. RIP AA award chart, you were good value while you lasted (until March at least I guess). Given the way all these devaluations and the AUD are going, it’ll be cheaper to outright buy a J fare in the future 😛

   One can only hope Alaska doesn’t follow suit next year with their chart…

   Reply

6. To clarify does this mean tickets that are booked after march or any tickets booked from now on for travel after march?

   Reply

   1. For tickets booked after March 22. Current rates apply until then.

      Reply

7. With the rising cost of USD and increased award points required for redemption, from March next year, the cost of buying AA miles to redeem a simple AUS-EU trip will be over $5,000.

   Reply

Leave a Reply Cancel reply

Comment *

Name *

Email *

Website

Save my name, email, and website in this browser for the next time I comment.

Δ