FlyerTalk Forums - View Single Post - Update: Aimia accepts Air Canada, TD, CIBC & Visa revised $450-million Aeroplan bid

Aug 22, 2018, 6:29 pm

#557

tecate55

Join Date: Apr 2016

Posts: 297

Quote:

Originally Posted by MasterGeek

Air Canada's initial offer to buy Aeroplan included terms that would waive contractual obligations (until 2020) they agreed to when Aeroplan was spun off.

So I'd say brace for devaluations of Aeroplan miles as soon as the deal completes. Air Canada will devalue Aeroplan miles as soon as they can (ie: 2020). Air Canada is known for being stingy/greedy and seeking to offer the minimum possible in terms of value and compensation to consumers often at the cost of negatively affecting customer recovery/satisfaction/loyalty. They are far from being like Alaska Airlines.

My predictions:

AC will remove the whole 8% of every route, every month, guarantee for Aeroplan. AC wants to optimize for paid seats. Points redemptions on otherwise unfilled seats is basically free for them, unless you were otherwise going to pay cash for the ticket. Good luck using Aeroplan points (at fixed mileage redemptions) on popular/profitable routes in the near future. They can do this silently, and very profitably. Initially, AC will play with the numbers manually (change 8% to 2%), then set it dynamically. Aeroplan will become more of a game with continuously changing availability.
Mild devaluation of points - 10-20%. e.g. 25k-->30k for redemptions.
Aeroplan promos on new routes. Because new routes take time to get full loads, AC can directly appeal to Aeroplan members.
Reservations taken over by AC call centre staff.
Cancellation of the deals with Porter, Flair and Transat. My guess is that they weren't true agreements at all, just to create pressure. Aeroplan probably drafted a contract that says "We'll sell you Aeroplan miles for $0.0000001 starting 2020. Either party can break this agreement for $x million break-fee with 30 days notice, without any damages. Here's the only press release you're allowed to publish".
1. Flair "CEO" : "Hey Aeroplan, I'd like that free money, but I only brought a bucket and mop. Can I borrow your pen?"
2. Transat CEO: "I'd like that free money. My pen had a part that was 0.00005" too short and all the ink leaked out, can I borrow your pen?"
3. Porter CEO: "I'd like that free money, where do I spill my pilsner?"
Levelling the playing field with competitors and scamcharges. Either Lower AC scamcharges, or new charges for non-AC bookings. AC would be dumb to payout to other airlines what it could keep for itself.
No idea if TD/CIBC will do anything different other than cement their current state. No clue what's in it for Visa, other than stopping Mastercard from getting in the Aeroplan game.

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