$ value of E50
 

A colleague and I were discussing the $ value of an SE gifting E50.

As a purely theoretical discussion, what would you value (and why) E50 at for 2013?

Bundle 1

50% tier bonus (assuming 50K miles, 2c per mile) = $500
30 e-Up credits (assuming $50/credit) = $1,500
Lower requalification level = $ 0 (if you're going to gift E50K, chances are the receiver doesn't fly enough to make this useful)

Bundle 2

10 e-Up credits (assuming $50/credit) = $500
4 MLL passes (assuming $25/pass) = $100
AC travel options = $50 (no concrete idea what it is, so I'll say it's worth $50)

Bundle 3

8 e-Up credits (assuming $50/credit) = $400
1,250 status miles (assuming 2c/mile) = $25

*G benefits = $250 (once again, if you're going to gift E50K, chances are the receiver doesn't fly often; I'll say $250 saved in time/headaches/etc.)

E50K value: slightly over $3,000 (if AC were to sell E50K)

Then again, none of us would actually pay $3,000 for E50K.

Value depends strictly on how much you fly.

I find the idea of SE being able to gift a E50K interesting tactic by AC. It is clever way of extracting a benefit from a SE. Impact to people who are E50K or higher is minimal to nothing.

After all if you can't earn a E50K how much are you actually going to use it ?

Nice analysis.

I would guess no regular on FT would pay $3k...but what we were discussing was some of our friends who make the lower tiers but really wanted E50.

MLL passes are $50 per pass if you tack them on to a paid booking so that would increase the cash value of the Bundle 2.

If one goes to E50 from no status at all, there is of course the value of bag fees also.

I don't know about nobody paying for E50. Those who might MR to make it are incurring some cost, right? But this is helpful -- Note to self: don't pay $3000 for a MR to make E50! :-)

50K miles, 2c per mile is $1000, not $500 :p

And are eUps worth $50? That seems excessively high.

I assumed 50K BIS miles flown, with a 50% tier bonus. At 2c per mile, the 50% tier bonus equates to 25K aeropesos. Assuming 2c per peso, $500.

The greatest value is when it is gifted to someone who just started business travelling and doesn't have status in 2013. this is the case for the person I'll be gifting mine to, she did just 20k in the last 4 months of the 2012 and will make 50 or 75k level late next year, so the ability to have the perks ahead of time is nice.

Plus as she will owe me one, I can call on her for e-upgrades should I be running low between thresholds.

Bags alone will save her a mint, or at least allow her to pack like a crazy women and not worry about it.

It all depends on your flying habits. If the only tix that are bought are in Tango, then E50 is virtually worthless other than a few MLL passes.

If one flies Tango+, the value is marginally more based on a low percentage of successful upgrades (depending on your routing) multiplied by the market rate difference between a Tango+ and J.

If one flies Latitude, the value is much high based on a high percentage of successful upgrades multiplied by the (albeit lower) difference between Latitude and market rate J.


As you can see, there is a sliding scale and the answer is always "it depends".


I think the operative word is "just" starting biz travel. I give any colleague the evil eye if they actually check luggage.

You are missing one key point: one gets to pick two options from bundle 1, two from bundle 2 and one from 3.

So for bundle 1, since you assigned zero to third option, fine. However if I get this for my wife, who normally travels on my miles, going by this year's travel, she won't accumulate more than say 15 k miles. In which case 50% tier bonus is only worth $150, arguably less. Total $1650.

Bundle 2: the e-credits only, so $500.

As to bundle 3, she won't buy a pass (I might buy a two pax one myself). So, worth zero for most people.

Total: $2150. While by same valuation, the 50 credits I will miss would be worth $2500.

So where is the catch? I will end up the year on Feb. 28 with over 50 unspent credits that will vanish. I still can use her credits so the loss is only ten. With zero marginal value to me really.

Bottom line: at the end of the day, better getting her status than seeing the credits go poof on Feb. 28. Even if she won't use much of it.

A 6-credit domestic upgrade (say YYZ-YEG in T+) is usually offered as a $289 LMU, so the $50/credit is a reasonable assumption. However, since most people don't bite on the LMUs one can assume that the market value is lower.

Assuming 100K BIS miles for SE at 2c per mile, that would be a $2,000 value. That would exceed the $2,150 value of nominating someone as an E50K.

???

Sorry, I don't understand? Where does 100K BIS miles for SE at 2c per mile come into the picture? (I would not exchange the miles bonus for the E50k for my wife.)

And how is $2000 exceeding $2150?

Sorry... I thought you meant that you were planning on doing 100% tier bonus and 50 e-Up credits for your SE select privilege. I was trying to say that E50K would be a better value than the tier bonus.

I bought a YYZ-SFO LMU for $400 once. That would normally be 10 credits. I did it because I wanted to try it out, nothing more. I would never do it again. So there, it was $40/credit, and not something I felt was worth $40/credit.

But if I get a T+ (M) flight pass, then we end up $100 credits (4 credits, probably still $400). I just don't think there's an accurate way to price these things.