I thought Velocity were ‘done’ with their latest round of award chart changes that went into effect on June 1st – but no, this latest change is very stealthy and a bit more lethal to your wallet.
For bookings made from 18th June, a new “Etihad Airways Reward Seat Carrier Charge” is being added for Etihad redemptions using Velocity points, set at $50 USD in Economy, $205 USD in Business and $300 USD in First Class.
This latest change from Velocity is essentially a stealth devaluation of Velocity Points for anyone who might have wanted to redeem them for Etihad flights, and is poor form from a frequent flyer program that otherwise has a lot of respect around these parts.
What are the changes?
They are fairly simple – the charges of:
- $50 USD in Economy
- $205 USD in Business
- $300 USD in First Class
are being added to any booking using your Velocity points for travel with Etihad
(except for itineraries departing from Manila).
Etihad were one of the casualties of the recent award chart changes, with all of their redempton pricing increasing.
The killer piece to this change is that the charge applies per flight sector, not per booking.
This means that return flight to Europe in Business Class, with a transit in Abu Dhabi, now costs an extra $410 USD each way. It would be worse in First Class too.
That’s an insane change from the current level were you’ll pay a relatively low amount of taxes and surcharges.
Velocity are reknowned for their excellent award pricing, both in points and additional fees imposed on award bookings. This charge really adds a nice layer of confusion to that perception, where some partner carriers continue have low pricing while Etihad doesn’t.
The page on the changes on the Velocity website is here. H/T to Australian Travel Points for the heads up.
I managed to squeeze in an Etihad A380 redemption using Velocity points from London to Sydney back in March (pictured above) and it was excellent – possibly the best two Business Class flights I’ve ever taken.
We’ll do a deeper comparison battle of the new Velocity pricing (for points and taxes) versus using Qantas Points to travel with Emirates on a range of routes to Europe and the US.
Not sure if you guys have published this elsewhere, but I noticed a new “Virgin Australia Carrier Charge” (footnote 7) listed here: https://www.velocityfrequentflyer.com/content/Redeem/Airlines/PointsTables/
Yep—thank you! Our take is here.
Yes this fee is ridiculous and bad for the program. BUT what about using air italia instead from abu dhabi? They are now partners in the VA program and apparently the redemption rates are the same as when flying on VA flights. Lucky we booked our zurich syd business class flight with EY earlier in year! Etihad is a great airline but would be interested in the air italia option to save serious cash to Europe using velocity points. Anyone booked on air italia using VA points yet?
I don’t know of anyone who has made a redemption yet, but we wrote up a full guide to Alitalia redemptions using Velocity Points here.
I made a booking last week with Virgin Business Class one way London to Brisbane. When I queried the massive $900 plus charge, I was told that this is what Etihad had demanded and Virgin could do nothing about it. As I didn’t want to return till after June next year I couldn’t make the booking till after the 7th July this year. I had already made a booking Bne to Lhr using Etihad points, from memory about $300.
I would also like information from someone about the 15% that Virgn often offers when exchanging points, this is a very cunning move as when you have your points added directly from your bank to your velocity frequent flyer points they never give you the 15%. Now want to stop the, doing this so I can save the points and only transfer when the 15% is offered.
Virgin Is getting less and less attractive especially as I have lost my silver status. Think I may have to revert to Qantas and Emirates again.
I am not a business traveller, but an almost 80 year old traveller counting every penny to see my children in the UK.
Hey Katherine – it’s a painful change for sure. Some further info on the 15% Velocity transfer bonus offer is in this guide, and yes, this is only a benefit for most of the ‘flexible points programs‘ which allow transfers to Velocity, and is a downside to the Velocity branded cards – which make life simpler, but you do miss out on offers like this.
Any suggestions on the best way to give them feedback? Was thinking to post to their facebook page…
That’s really disappointing from from Virgin. One of the benefits of Velocity over, say Qantas FF, was the relatively low taxes and fees when redeeming points for award bookings. To make a change that affectively adds over US$1,000 for a return business class redemption to Europe is extremely poor form.
I sent them an email to complain. Hopefully a lot of other people will too and it might cause them to rethink. This is a real slap in the face to customers, especially with all their bragging recently about what a great program it is on TV ads etc.
WTF is this in US$ too, when Velocity is an Australian program?
Etihad added a carrier fee of US100 per sector for their business redemption. Velocity has more than doubled this fee.
Such a terrible move from Virgin, first to de-value the points and then to follow it up with this additional charge. I have voiced my disappointment to VA but encourage everyone to do so also. VA have lost my loyalty with this move.
Looks like they also broke one of there T&C as this is now a standard charge for every Etihad reward booking
25.1 General
From time to time, We may charge fees to Members for all or any of the services which are the subject of our commitments to the Member. We will give at least 30 days written notice of the introduction of, or change to, any fees, and also post details on the Fee Schedule on the Velocity Website
I have used many millions of velocity points over the last few years to travel to Europe with etihad , to the us with virgin and around Australia I’m now rethinking to transfer pints to velocity Kris flyer is looking a lot more attractive
Quote article
“….Velocity are reknowned for their excellent award pricing…”
How the hell do you work that out?! Surely you don’t think that applies now (even if it ever did)?
Their award pricing in terms of points required is broadly similar to that of QF (= BAD!).
That on top of the fact that:
you can’t always access the award inventory visible on Etihad’s website for EK flights
you have limited access to SQ inventory, and no access to first class inventory (unless you transfer points over to SQ at a loss)
you can’t access Hawaiian business class inventory (which is easy to get via AAdvantage)
partner Air NZ rarely offers award peace (and who knows how long the Air NZ hook up is gonna last!)
Velocity is just simply not nearly as generous as it used to be for VA international premium reward space
Raking in excess “carrier charges” (where is the ACCC when airlines do this?) diminishes Velocity to the point where it is no longer a serious contender for loyalty.
At least on QF you can access extensive EK award inventory (often released a few days before the flight), if at peril of absurd “carrier charges”.
Some folk take the smart option and bypass Velocity and QF FF altogether and assign flights directly to alternate FF schemes such as AAdvantage.
I lost my faith in Velocity some time ago and was delighted to transfer a substantial points balance over to SQ the moment that became available.
OK, fair call, should have had a past tense and a caveat – was known for excellent pricing on Virgin Australia-operated flights.
The old table 1 (including Etihad) used to be pretty appealing, given how easy it is to pick up Velocity points from non-airline partners in Australia. But not so much now.
😉
This is not a good move by Virgin. Members are the backbone of their frequent flyer program and I am sure that the addition of such fees with no notice has resulted in significant customer dissatisfaction. Below are sections of Velocity’s T and C’s.
We do not have to give Members any other notice of changes, even if the changes affect or remove features of Velocity Frequent Flyer, Member Benefits and or Program Partners. However, We will try to give Members reasonable notice of changes which are materially detrimental to the membership as a whole, or if We introduce or change any fees in accordance with clause 25.1.
FEES AND CHARGES
25.1 General
From time to time, We may charge fees to Members for all or any of the services which are the subject of our commitments to the Member. We will give at least 30 days written notice of the introduction of, or change to, any fees, and also post details on the Fee Schedule on the Velocity Website.
As you can see the terms and conditions in 25.1 state that they will provide at least 30 days notice if there is a change to any fees and charges which had not been done in this case. Consumers will loose faith in the transparency of this Frequent Flyer Program if they make unannounced fee changes like this in the future without adhering to their published T and C’s. Someone should bring this up with mangement Keith!
Using Velocity points for Etihad redemptions was always poor value – given how easy it was to take advantage of Etihad redemptions via Etihad (with their multiple bonus on flights offers, and cheap point buy up), or AA cheap redemptions (where you can just buy the points during the multiple promotions).
This change doesn’t make it any better, but it wasn’t any good previously anyway.
Velocity points are for either transfering to Krisflyer or redeeming on VA services – anything else is pretty poor value.
Redemptions on EY using EY points for most of europe were more expensive than virgins rates
Virgin points were also very easy to amass recently without having to buy them, 110k amex 60k nab 75k anz black etc
Couldn’t disagree with that more.
I got Frankfurt to Perth for 110,000 velocity points a couple of moths ago, and about $75 in fees. Was amazing and availability was wide open; I booked it only a couple of weeks before the flight.
Transferring into Krisflyer is the waste because you lose 35% and the fees are massive for Singapore Airlines flights. Though with this change it will make it feasible to do that.
A big mistake by VA. As a long time Velocity Platinum we continuously accumulate points for Etihad business redemptions by directing our flight and credit card transactions to VA/Velocity. Will now reassess QF and will probably give VA the 2 finger salute. Hopefully enough people will voice their disapproval and force VA to re-think this decision.
I have been accumulation Velocity points specifically to try to fly EY Business to New York. It was originally 125K then up to 139K all of which were OK for us. Now the extra costs make it far less likely that we will use EY. The problem is that there are no alternatives for Syd-NY available to us I don’t think. Not happy.
Really hope they’ve thought this through properly. Adding over A$1,100 to a European return could be a deal breaker for the whole program. Sure there’s still SQ but Qantas points have multiple carriers to choose from…….
I totally agree. The more I think about this, the bigger a deal this change becomes for Velocity (at least to Europe or Middle East, and potentially East Coast US). The comparisons to Qantas redemptions for partners like Emirates and Cathay will make for interesting reading a little later this week.
Two people return First Class to Europe or the US, that adds up to well over A$3K. Not cool.
When Etihad guest program added carrier charge last year it was econ $us 50, Bus $100, first $150
Velocity economy is the same price but business /first is double Etihad guest charge could that be an error?
Also it’s not known yet if bookings made before 18-Jun that you date charge after will incur the extra fee.
I don’t think it’s an error, I think it’s just Velocity looking to increase revenue.
My research so far indicates that bookings made before the cut off date, but changed after, will incur the additional fee.
When I rang Velocity late yesterday to inquire about business class reward flight with EY I’d been needing to change dates but not till early July, I assumed what you are saying re charge is waivered for bookngs before 18-Jun, however they couldn’t tell me if that would be the case they currently had no info regarding bookngs already made. Told me to call back later this week and they might know by then. Man it bad enough they have added this charge on top of the EY point increase but the fact Bus/First is double what EY charge. You’d also think they would have made Economy $100 then to get more revenue from reward bookings they must get a lot of.
Do they run customer satisfaction surveys? I’d love to get my name on the list. This is the fourth time they’ve dropped the ball for me (I’ve had some poor face-to-face and online customer support).
I think I’ll probably be focussing on Qantas rewards in the future.
Must be don’t strains to the traditional for this to happen. Same points as Singapore but now a surcharge towards the price of an economy flight to Europe.
Krisflyer are the real winners from this choice. It’s practically impossible to book a reward seat in business on virgin unless you’re a points millionaire.
I am just wondering how the changes will affect the other way- using Etihad guest miles on VA flights. I can’t see any info on either website regarding changes but I assume there either is, or will be in future?
As far as I know there are no (publicly known about) changes to Etihad redemptions with Virgin Australia flights. That said I think this redemption option will grow in popularity as Etihad Guest becomes more prominent in the Australian market with flybuys, and it could cause it to be looked at.
This program really needs to think long and hard about how it treats its members. To reclassify flights on 1st June and then impose this days later? Not on…
That’s really annoying, I was planning on booking some Europe flights for next June/July on Etihad… guess it’ll be on Singapore now.