What happens if A3 goes bankrupt?

Old Jun 13, 12, 6:57 am
  #46  
 
Join Date: Mar 2002
Location: DUB - Ireland
Programs: EI-GCE, BD-G, BA-G, A3*G, TK*G, FB-G, HH-G, Hyatt-Dia
Posts: 8,526
Originally Posted by Shareholder View Post
(I now expect the Mod to tell me I have been banned from FT for trying to clarify the record -- and thus being off topic -- but I suppose I can bear a second banning during more than 10-years of postings.)
You can expect what you like. You might be disappointed, though. When you break the ToS or ignore a warning you'll get your intervention, till then you'll have to contain your disappointment. The in-line warning above revolves around everyone playing nicely.

Now, let's steer away from discussing (potential?) Moderator Actions on the board, or the ToS may kick in, after all, eh?

GoldCircle
A3 forum Mod
GoldCircle is offline  
Old Jun 13, 12, 7:06 am
  #47  
FlyerTalk Evangelist
 
Join Date: May 2011
Location: MMX (CPH)
Programs: QR PC Platinum, AY+ Platinum, A3*G, Eurobonus silver (!), Nordic Choice Platinum, Liberokerho GOLD
Posts: 10,838
Originally Posted by Shareholder View Post
...

Similarly, A3 has a low threshold because the majority of its members who actually live in Greece or the region, fly ultra-short flights within the country, and thus should be able to achieve a parity of STARGold status with less mileage than those in programs of airlines operating in countries where the average flight segment was well over 500 miles.
...
So each program's thresholds are designed with the particular nature of the country's frequent travellers and the benefits the airline program wishes to bestow.
...
Yes, A3 program is naturally designed with this in mind. You will earn 200-600 miles for a domestic Y flight, 800 in J. For A3's international flights, the max earnings are 2000 in J.
From this point of view Gold requires 100 segments in deep discount domestic econ, or 10 segments international J. Quite on par with other programs.
The difficulty first presented itself when A3 joined *A, where earnings are much higher. They could inflate their own thresholds and earnings to the *A level, but then they devalue the accumulated points for existing members.

Adding a minimum required miles/segments on A3 metal is a much better solution, and if they need to limit the number of members who never fly A3 I am sure they will add that in a flash.

I am not sure they need that, though? Has it been estabilshed that the membership airline pays for lounge access? I am under the impression that the operating carrier pays for lounges.
intuition is online now  
Old Jun 13, 12, 8:10 am
  #48  
 
Join Date: Oct 2010
Location: SEA
Programs: AS 75K, TK ELPL (*G), BA Gold (OWE), DL GM (ST E+), Hyatt Globalist, Hilton Diamond
Posts: 7,441
Originally Posted by intuition View Post
I am not sure they need that, though? Has it been estabilshed that the membership airline pays for lounge access?
Yes, I have it in writing from the manager of Miles and Bonus.

However, I'm inclined to think that the revenue from the miles credited to Miles and Bonus pay for the lounge access and more.
PVDtoDEL is offline  
Old Jun 13, 12, 8:40 am
  #49  
 
Join Date: Jun 2004
Location: SXB
Programs: Flying Beurk Silver, BA Gold, BD Gold rememberer, A-club Platinum, Hilton Gold
Posts: 2,472
Originally Posted by PVDtoDEL View Post
However, I'm inclined to think that the revenue from the miles credited to Miles and Bonus pay for the lounge access and more.
That has been BD's rationale for years. It could be even more true for A3 as they give less miles for booking classes where lounge access isn't included, lessening the cost of booking award seats.
Richelieu is offline  
Old Jun 13, 12, 9:48 am
  #50  
A FlyerTalk Posting Legend
 
Join Date: Sep 2009
Location: Minneapolis: DL DM charter 2.3MM
Programs: A3*Gold, SPG Plat, HyattDiamond, MarriottPP, LHW exAccess, ICI, Raffles Amb, NW PE MM, TWA Gold MM
Posts: 86,963
Originally Posted by PVDtoDEL View Post
Yes, I have it in writing from the manager of Miles and Bonus.

However, I'm inclined to think that the revenue from the miles credited to Miles and Bonus pay for the lounge access and more.
If the status airline pays for lounge use, then it could be important to enter lounges with just the boarding pass when flying international J/C for example, so that the operating carrier pays when flying premium classes. OTOH, LH would be a special case as having *Gold gets you into a different and better lounge than the one you can use due to having a business class ticket, so that you would always what to show the *Gold card to enter the SEN lounge.
MSPeconomist is offline  
Old Jun 13, 12, 6:30 pm
  #51  
 
Join Date: Aug 2010
Location: YYZ/YUL/YOW
Programs: TK*G/E+ SPG (G)
Posts: 2,932
Originally Posted by Shareholder View Post
Just to clarify with actual facts: AC's 35K for STARGold came about for very logical and specific reasons based on the Canadian market but was actually consistent with threshold levels set by the majority of other STAR carriers (as is its shift to 50K for next year). When the threshold was set, AC (and its competitor CP) both only gave 50% status mileage for domestic discounted economy travel. Since the majority of its members earned their status from domestic travel, it was acknowledged that 35K would be a fair number to offset the differential between granting 100% versus 50% for these flights.

Similarly, A3 has a low threshold because the majority of its members who actually live in Greece or the region, fly ultra-short flights within the country, and thus should be able to achieve a parity of STARGold status with less mileage than those in programs of airlines operating in countries where the average flight segment was well over 500 miles.

In LH's case, it uses the 35K threshold for STARSilver instead of Gold because its program is biased towards the high dollars spending corporate fliers who travel internationally in LH's premium classes. This also explains the generosity of mileage credit for C and F fares (200% and 300% respectively).

So each program's thresholds are designed with the particular nature of the country's frequent travellers and the benefits the airline program wishes to bestow. AC decided it didn't want to be a patsy any longer for bottom feeding STARGold aspirants and thus instituted a minimum flights/mileage on AC metal requirement. One hopes A3 sees the wisdom of paring down its STARGold ranks (and thus costs) by similarly instituting a requirement to actually fly A3 for a good percentage of the required mileage. It's a pretty good airline BTW, though most of you would never know it because you've never flown it.

(I now expect the Mod to tell me I have been banned from FT for trying to clarify the record -- and thus being off topic -- but I suppose I can bear a second banning during more than 10-years of postings.)
None of this addresses your initial posts about it being a 'scam' or 'starscam' or whatever you called it.

AC changed its 'program' because AE was spun off. AE was raking in the money, while AC got nothing from their legions of non-AC flying Elites. I suspect AC got PO'ed by the fact that AE was milking money by selling partner miles while it was only able to claim a fraction of that (probably just the amount relating to lounge access by AE members which, presumably, was footed by AC and reimbursed by AE). AE's success and profitability bode well for A3, since A3 owns its program and will reap the money AC lost out on. After all, I (and others) believe that AC instituted YQ on other airlines' rewards in order to generate revenue for itself by leveling the play field (ie instituting the same YQ fees on other airlines, which were attracting a lot of potential AC reward traffic by not charging YQ). This way, people travelling on rewards will be relatively indifferent to whether its on LH or AC. And I think we can agree that, at the very least, the YQ portion on AC rewards is a significant revenue generator for AC. That is all related to AC's decision to spin off AE into a separate company. A3 owns Miles and Bonus. It will reap all the profits/losses of the program, unlike AC which gets a fraction of mileage revenue.

The comparison, therefore, is invalid.

As to the issue of an apology - it is being addressed in the appropriate thread in the appropriate AC forum. Prove me wrong there and I will apologize both here and there.
yulred is offline  
Old Jun 13, 12, 7:19 pm
  #52  
 
Join Date: May 2008
Location: Northern Italian Lakes
Programs: BA, *A, Hertz Goldstar, Mucci wannabee, Waitrose, safari Oleg
Posts: 1,545
Originally Posted by KLouis View Post
I really don't understand why this particular forum invites opinions that are, mildly put, offending!
+ 1 ^
h15t0r1an is offline  
Old Jun 14, 12, 7:06 am
  #53  
 
Join Date: Mar 2002
Location: DUB - Ireland
Programs: EI-GCE, BD-G, BA-G, A3*G, TK*G, FB-G, HH-G, Hyatt-Dia
Posts: 8,526
Ok, it stops now.

No further discussion of scams, not scams, Aeroplan history, AC-forum-snide-comments or anything else that does not narrowly revolved around A3's financial health. No riding comments to on-topic posts, either.

This is not the forum for posters egos. It is the forum for discussion of A3.

Clear?

I've rarely if ever had to deal with external spats in the bmi forum and I have no intention of allowing this sort of tiresome stuff to get a foothold here.

/Move along now, nothing to see here.../

GoldCircle
A3 Forum Mod
GoldCircle is offline  
Old Jun 14, 12, 7:42 am
  #54  
 
Join Date: Jun 2004
Location: SXB
Programs: Flying Beurk Silver, BA Gold, BD Gold rememberer, A-club Platinum, Hilton Gold
Posts: 2,472
There is a point that's worth noting with AC, though, which sheds light on A3's situation. Aeroplan is making money. It was known, but difficult to prove, that BD's approach was financially sound. With AE as a separate and not-bankrupt company, we have the demonstration that FFP can be a profit center, even when paying for lounge access once in a while. This may explain why A3 isn't rushing to implement more stringent requirement to make a profit center less successful. There's obviously some kind of balance to be found, like BMI did.
Richelieu is offline  
Old Jun 17, 12, 7:52 am
  #55  
 
Join Date: Feb 2011
Programs: BAEC, A3 Blue (*A Silver), HHonors Gold
Posts: 55
Originally Posted by Richelieu View Post
There is a point that's worth noting with AC, though, which sheds light on A3's situation. Aeroplan is making money. It was known, but difficult to prove, that BD's approach was financially sound. With AE as a separate and not-bankrupt company, we have the demonstration that FFP can be a profit center, even when paying for lounge access once in a while. This may explain why A3 isn't rushing to implement more stringent requirement to make a profit center less successful. There's obviously some kind of balance to be found, like BMI did.
Posts in the AC forum make it sound like it's AC, not AE that's paying for lounge access every time E and SE pax swipe their cards. Ergo, the new AC metal requirements.

Of course, that could be completely wrong—it could be that FTers know nothing about the secret wheeling-dealings of Canada's longest running frequent-flyer sc... heme. It's mostly speculation, I'm sure.

Though OZ does have basically the same requirements as A3, just on a two-year schedule, so it's not unprecedented. I'm sure that BD, OZ and A3 all thought this out more than FTers often give them credit for—even if the number of people working full-time on the FFP in the company is less than the number doing it full-time on FT.
Philosofaux is offline  
Old Jun 19, 12, 4:54 am
  #56  
 
Join Date: Oct 2010
Location: SEA
Programs: AS 75K, TK ELPL (*G), BA Gold (OWE), DL GM (ST E+), Hyatt Globalist, Hilton Diamond
Posts: 7,441
Originally Posted by Philosofaux View Post

The biggest single risk to its operations is if Greece were to leave the Eurozone.
Well, the election result makes me hope that we won't have to worry about this as much any more...

Last edited by PVDtoDEL; Jun 19, 12 at 5:38 am
PVDtoDEL is offline  
Old Jun 19, 12, 7:38 am
  #57  
 
Join Date: Jun 2006
Posts: 4,779
Originally Posted by PVDtoDEL View Post
Well, the election result makes me hope that we won't have to worry about this as much any more...
Dont be so sure . I know Greek politics and it wont be long before they start fighting again and the coalition collapses. Im willing to be proved wrong though. Maybe this time they will actually put the country first and its people before lining their own pockets!

Anyway OT I know but an important point.

For the sake of A3 / OA and tourism in Greece I hope you are right .
DELLAS is offline  
Old Jun 19, 12, 7:51 am
  #58  
 
Join Date: Jun 2004
Location: SXB
Programs: Flying Beurk Silver, BA Gold, BD Gold rememberer, A-club Platinum, Hilton Gold
Posts: 2,472
Originally Posted by DELLAS View Post
Anyway OT I know but an important point.

For the sake of A3 / OA and tourism in Greece I hope you are right .
For the sake of tourism in Greece, leaving the eurozone, which imply a weaker currency, would be a boon instead of a bane.
Richelieu is offline  
Old Jun 19, 12, 10:35 am
  #59  
 
Join Date: Jun 2006
Posts: 4,779
Originally Posted by Richelieu View Post
For the sake of tourism in Greece, leaving the eurozone, which imply a weaker currency, would be a boon instead of a bane.
They can still be good for tourists inside the Eurozone as we are seeing now.
Same in Ireland. Hotel prices are falling and prices in restaurants and attractions are falling too . Both countries had over inflated prices compared to others. Its actually nice to see it getting back to reality.
DELLAS is offline  
Old Jun 21, 12, 11:37 am
  #60  
 
Join Date: Feb 2011
Programs: BAEC, A3 Blue (*A Silver), HHonors Gold
Posts: 55
Originally Posted by Richelieu View Post
For the sake of tourism in Greece, leaving the eurozone, which imply a weaker currency, would be a boon instead of a bane.
Originally Posted by DELLAS View Post
They can still be good for tourists inside the Eurozone as we are seeing now.
Same in Ireland. Hotel prices are falling and prices in restaurants and attractions are falling too . Both countries had over inflated prices compared to others. Its actually nice to see it getting back to reality.
Ireland and Greece are both having a very difficult time doing an internal devaluation within the Eurozone. Wages, especially, are sticky downward (ie very resistant to falling, hence the general strikes and protests seen in Greece), but so are many other costs.

The only effective way for Greece to have a meaningful devaluation within the Eurozone is for Germany, France and the Benelux to accept significantly higher inflation for a long period of time while the price level in Greece (and Spain, Italy, Ireland and Portugal) remains stable, making those countries relatively less expensive than their counterparts.

Germany has made it clear that they don't want to do this (so far) and screams bloody murder every time it is suggested. The ECB is modelled on the German Bundesbank, and therefore it is a remarkably ineffective organisation: it has one objective, and that is to control inflation. Most other central banks (such as the Bank of England, the Fed, the Reserve Bank of Australia and the Bank of Japan, but with the notable exception of the Bank of Canada) are mandated to balance the dual objectives of maintaining price stability while promoting economic and/or employment growth. The ECB therefore has no ability to adopt a policy that would lead to higher inflation.

Without either central bank action or an exit from the EMU, any price adjustment in Greece will be modest at best and more likely insignificant.
Philosofaux is offline  

Thread Tools
Search this Thread
Search Engine: