This probably is not a devaluation. It's a devaluation when the product or service is priced the same, and costs the same to provide, and the amount of currency required to buy that identically priced/costed item goes up.
The average ticket price has increased. The average underlying cost has skyrocketed. Yet, until November 1, the currency in miles required stays the same. If anything, the current product you can buy with miles may be undervalued, not devalued.
Now, one may make a case that the product is a single ticket, and not the price of the ticket. But considering how much folks here work to come up with a cents-per-mile value, I don't think this is a devaluation. Just an adjustment to current values.
Though I'd be interested in seeing an analysis of average ticket price vs. miles required on popular routes from, say, a year or two ago before oil began its dramatic rise, to the current level.
First, jet fuel does not comprise 100% of the expense of the flight. Employees don't work for free, etc.
You might want to read Scott McCartney's recent The Middle Seat column from June in the Wall Street Journal which showed that the fuel cost percentage of the average ticket price was 50% or higher. Four years ago, it was 10-20%. It was a very scary economics lesson -- prices have not risen nearly as rapidly as costs.
You are overstating the need for a current price increase for 2 reasons:
First, jet fuel does not comprise 100% of the expense of the flight. Employees don't work for free, etc.
Second, I heard on the news that AS hedged half of its fuel for 2008 at $70 a barrel. If this is anywhere near correct a 100% increase in fares over last year is not yet justified.
You're absolutely correct on both points and Seattlenerd provided some good information regarding the relationship of oil to the cost structure. I was primarily trying point out that expecting not to see a change in strategy or redemption costs since oil has fallen 15% in the past few weeks is asinine.
I was primarily trying point out that expecting not to see a change in strategy or redemption costs since oil has fallen 15% in the past few weeks is asinine.
Are you giving us another Freudian slip or a flip-flop? The post to which you were responding earlier was about expectations for a change in costs dependent upon oil prices (falling).
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This game is not as much fun as it used to be: 2008/2009 Frequent Flyer Program Fleecing Award goes to Delta Airlines
Are you giving us another Freudian slip or a flip-flop? The post to which you were responding earlier was about expectations for a change in costs dependent upon oil prices (falling).
I don't care what the heck your expectations are, but if you look at a meaningful time period, oil prices haven't fallen.
This about seals the deal with me and Alaska. It was a good ride while it lasted, but they've shown me that they could care less about it's core consumers.
It all started when they cut the SNA-OAK route, which I flew about 20 times a year with my wife. Throw in several trips to SEA and many trips on AA that I put into Mileage Plan. I could have easily been PLT on AA, but chose to remain loyal to Alaska. What did they offer me as a MVP GOLD....a whopping $50. They cited competition....only Southwest flies that route. They cited oil, OK that one works. Then they expand services under this "west most" bull-crap to places like Santa Rosa, Yuma, etc.
They were an airline that valued it's customers.....now they could care less.
While we are all complaining about the mileage changes to MP, AS announced 5% of its work force is being layed off. Horizon is laying off 13% of it's workforce. I'm sure those employees that are losing their jobs are sympathizing with everyone here about the degredation of MP. My neighbors son is a pilot for Horizon. I wonder if he has a job today.
Programs: AA (EXP/1MM), AS (MVP), UA, SPG (Gold), HHonors (Gold), Fairmont PC (Plat)
Posts: 723
Quote:
Originally Posted by JPat
I have only used it a few times myself but it is a joyful moment when the miles show up in the account. My primary worry is that the lack of miles on these discounted fares opens the door to eliminating miles on all discounted fares. Such as the companion fare on the Visa card...
The Delta Amex companion fare only allows one traveler to earn miles. When someone is trying to keep status up for two people it is incrementally more difficult to keep within the travel budget and achieve status for the both of us.
I agree that AS FFP awards have been significantly better than other airlines but over the years this program has worked very well for us flying out of SEA. (Yes, we both long for the days when it only took 5K award miles to grab a seat in F.) As much as I hate to see the 20k level go the way of the blacksmith I can't really begrudge them the change. Especially in light of an earlier post about a MVPG lunch wherin the possibility of having a different award level for trancontinental flights was bandied about.
Can you imagine the hue and cry that would have stirred up?
The AS50 was a blessing when I needed a last-minute trip to YVR. At $700 and up for those fares, the $250 discount is nice and being able to earn miles (and EQM) made it workable. Now I would probably try to cash in miles for a completely free trip.
__________________ Flights Since 1 Nov 2007 AA comp upg: 26/29 (2 irrop) AS comp upg: 8/11 UA upg: 0/0
Programs: AS MVPG - AA NW CO UA US. Marriott Silver
Posts: 786
Quote:
Originally Posted by GUWonder
Why would you think that? Didn't you give AS any business? Didn't you give AS's partners any business that resulted in miles being purchased from AS and placed in your account? If yes to either question, then award tickets are better characterized as "something for something" than "something for nothing" -- AS certainly got some revenue for those miles placed into AS members accounts that have (or have not) been redeemed for award tickets.
...most of those trips don't happen because they're going to earn me miles. They're trips that had to be taken for one reason or another. Its just a matter of how you approach it. I certainly don't see it as an entitlement which is why, I suppose, I just don't get the rage that seems to be here for some of the changes.
For those of you dumping MP and moving to Rapid Rewards, enjoy your free tickets to Kansas City, Tulsa, and Baltimore. I'll stick to Mileage Plus. It will take a little bit longer, but I'll wave as my flight to CDG, HKG or SYD passes the blue and brown bombers on the taxiway.
Bad Move....another one
