Originally Posted by
checkerboard
This is just $27 more than the co-pay for an upgrade using miles, which is to say, suggests a valuation of $27 for the 25,000 miles this would normally cost - if AA made space available using that instrument.
When the buy-ups are this low, it can be an interesting case of how the left and right hand don't talk. I wonder what AA's internal liability per mile is on their balance sheet. I have to imagine this $0.001 is getting close, if not below the value. Isn't it financially advantageous, then, for AA to clear the upgrade in these cases? One could create complex inventory arguments, but I would say the AAdvantage team could create a script to "purchase" the buy-up from the buy-up team when it makes sense and turn a small internal accounting profit. Same argument for SWUs. I'd guess internally SWUs are valued at roughly equivalent to the highest miles+points value. There should probably be some type of short circuit on C availability for these cases.