Originally Posted by
hyho61
Just wait another 2 years, UA will adjust the mileage earning for card holders by 1 mile less, once they get enough card holders.
Unlikely - they will never reach that threshold.
Originally Posted by
findark
I think by far the most significant impact is to slash UA's liability sheet for occasional travelers who signed up for UA MP but do not fly often enough to pay attention to a CC or really make it worth it. Mileage earning is going down 40% for this class (100% if flying BE), and with no expiration I think the carried liability is somewhat significant for UA, especially this probably represents a significant number of customers.
Heck, that's me now - I still fly UA once or twice a year when it makes sense for price and schedule, but it's not worth trying to get a UA CC for that kind of travel and I don't really count or care about my miles (I would fly UA on these routes even with no FFP). So UA slashes my earnings by 40% and I keep flying occasionally.
This is already accounted for - part of the liability calculation includes estimated "mileage breakage" to reduce the liability.
From the 10-K:
Estimate of miles not expected to be redeemed ("mileage breakage"). The Company's mileage breakage model is based on the assumption that the likelihood that an account will redeem its miles can be estimated based on a consideration of the account's historical behavior. The Company uses a statistical model to estimate the probability that an account will redeem its current miles balance and reviews its mileage breakage estimates annually. The Company's estimate of the expected mileage breakage requires management judgment. Changes to mileage breakage assumptions, or to program rules and program redemption opportunities, may result in material changes to the deferred revenue balance as well as recognized revenues from the program. We recognize mileage breakage proportionally as the remaining miles are redeemed.