Rivarix

But isn't that to be expected? I mean majority of AA members based in the US and to be on your HKG-EU flight requires staging (and therefore additional AA miles). So why would they want to be on your flight HKG-EU flight when they can go directly to EU (TATL) or HKG (TPAC) from the US?

Maybe so but
1) grAAbers cannot use their AA miles to redeem that SQ flight.
2) if you don't live in the bay area that means you also need to shell out either cash or AA miles to get to SFO (unless you're talking about redeeming KF miles all the way through which is a separate topic as we're talking about AA miles redemption on CX here).
3) you're assuming grAAbers are only heading to HKG. From reading the AA forum they usually go to other places in asia as well. So now they need to shell out KF miles to get to HKG and AA miles to go elsewhere in asia (on CX/KA from HKG). That's not a very efficient way to use miles.

Rivarix

I think CX is also banking on the lingering perception it is a cut above other airlines and that's much harder to change until people actually try something else. Most people aren't like us here on FT.

We were vacationing in the middle east at the end of May and parents requested (more like mildly insisting) CX ex-CGK as they've mostly flown CX/KA on their inter-asia trips. LOL ... since the trip was on me I said no - either QR or no miles for you! Not for nothing, it would've cost me more miles to fly via HKG anyway. We went to FRA afterward to visit relatives and I did agree to let them fly CX on the way back.

Now they rave about QR to everyone. About Al Mourjan lounge, about QR A359, about the on-demand food concept, about the PJs, about the armani pouch, about the blanket, etc etc. So much so that I had to call MPC to change the return flight - now they want to fly FRA-DOH-CGK instead of FRA-HKG-CGK.

They are still going to fly CX/KA on their inter-asia trips (it's more convenient than SQ) but I don't know if they will still insist on flying CX on their next EU/NA trip.

AA_EXP09

This was true even during the times when you could get oneworld/explorer RTW awards on AA.
In any event, it can still be useful to credit to AA even living in Asia-so far I am more than halfway done qualification with 3 Asia-EU trips, 1 TATL, and 1 TPAC.

Rivarix

I agree with the lounge access but is that how it works with F redemption as well ? I mean is our F redemption (vs. AA F redemption) really a liability to CX?

I'm not familiar with airlines' journal entries but here's my thought.
1) our AM miles are already sitting on CX balance sheet as liability (generated when we fly).
2) When we do F redemption CX will debit (and thefore reduce) the liability and credit revenue.
3) Yes, AA F redemption means actual cash inflow but when i redeem AM miles on QR that means actual cash outflow for CX. If i were to redeem my miles on CX, no actual cash leaves the company - just some journal entries. So all things equal wouldn't CX prefer me to redeem my miles on CX instead of on partner airlines? Therefore until now CX probably somehow feels that catering to AA members is not displacing our ability to redeem AM miles on CX.

... or maybe CX knows it is displacing MPC members and hoping that instead of redeeming on partner airlines MPC members will just let their AM miles expire (which the cynical me think may be management's ultimate goal). That's a true win-win for management. Cash flow in from AA, miles expires (and therefore no need to honour) from MPC members.

percysmith

I think that's the conclusion CX has reached.

People who earn them BIS CX flights will keep on earning them, so make the redemption system unfavourable for them.

Favour partner redemptions, or non-BIS sales e.g. to financial partners.

sscywong

I guess this is a very reasonable guess... Or let you use 138K miles to redeem an iPhone 6 16G...

QRC3288

No, it's not. There is a mistaken perception in here - which I was guilty of falling for myself - that AA award partner awards are superior to MPC awards because cash changes hand. This logic is not right (one example you give I quote below).

And, I suspect mgmt incentives are at least partially tied to some EPS metric. They are not tied to cash flow. Philosophical arguments aside, I'm almost certain it's more profitable (from a pure income statement P&L perspective) for CX to have fliers burning MPC awards than AA awards, and CX certainly has incentive to show good earnings per share optics.

Precisely.

I am not inclined to believe the conspiratorial (nonetheless, interesting) argument about CX plotting against its own MPC members, to let all their MPC miles expire worthless.

My best guess: CX has been asleep at the switch, recent changes including a.) smaller F cabins, b.) tighter award inventory, c.) good business conditions, d.) CX eliminating the DM benefit of converting cash to award inventory, have exacerbated the existing issue into the situation we have today. And methinks we're going to see some type of change within a year.

QRC3288

Disadvantage: MPC members forced to issue ticket by deadline (often way before flight departure), and cannot reissue in higher class. Issued tickets not refundable.

AA has advantage over MPCs here: AAdvantage members have clear advantage over CX's own program, because EXPs can book CX tickets and change them without penalty. Puts MPCs at a blatant disadvantage on their own metal.

Recommended change: MPC members be allowed to re-issue into higherclass for free if, after issuing award J ticket but waitlisting for F, eventually F opened up at the last minute. (this could also work for Y and PEY going to PEY and J).

I've had the unfortunate situation of waitlisting for F, booking J to at least get a seat on the plane, MPC eventually puts a gun to your head and says "you must ticket by x date, else your J ticket is gone", so you are forced to book J. Then F opens up before departure, but since you already issued J, and MPC rules don't permit you to change, you are in essence screwed out of what you originally intended to do.

(and then, in two situations like this, I've been op-upped!!...I can't imagine that's what CX is intending).

percysmith

http://hk.apple.nextmedia.com/realti...50622/53883742

Confirmation from Ivan Chu that AM and MPO will change their earn ratios, even tho the article has no specifics.

kaka

from apple daily, "以年初作出類似調整的英航為例，旅客乘坐經濟艙，所得里數較「舊plan」勁減75%；但客人若願意付出 高價，購買商務客位，里數則增加約65%。"

so some sub-class shall revert to 25% and perhaps full J would go up to 190% (125+65)%

kaka

Also from Ivan Chu - http://hk.apple.nextmedia.com/realti...50622/53883601

銀卡會員享用貴賓室將設次數限制，而最多人使用的綠卡會員，其優先辦理登機手續、優先上機等亦勢被「cut 走」。
1) Lounge benefits for Silver will be limited,
2) Green priority for checkin and boarding will be gone

Awesom Andy

I think they're simply using BA as an example, rather than speculating what the earn rates would be. Currently, deep discount fares earn 25% Asiamiles (and no MPC miles), and J/F/Y+ have their own higher rates.

Not sure how true this line is, "以機票價格取代實際飛行距離，來計算飛行里數", although it translates more or less as: miles are to be calculated based on fare price instead of flying distance.

Also, Chu believes that "即使按消費額計算里數，計劃仍具競爭力" (even if miles are calculated based on spending amount (i.e. revenue based), the program is still competitive).

1010101

Let's be honest, MPC is not currently a competitive programme in that regard. Someone flying the JFK route can spend $60,000USD and just scrape DM by a few hundred miles. Compare that with some other Oneworld programmes where a creatively routed $5,000 fare will get you the equivalent level of status.

Rivarix

Last paragraph ... isn't that similar to what Delta is saying? Is that where we're heading?

Also the articles talk about adjustments to earning, benefits, etc. but I didn't see any mention (even in passing) about adjustments to spending. Is there hope that adjustments to spending should be minor then since CX seems to be focusing on the earning and benefit sides? Wishful thinking?

soonyeap