Diplomatico

I was with you up until this last nonsensical part about a vault. Chase incurs the $300 liability for the travel credit when you pay the annual fee. That's not speculation, nor is it speculation to state that if you don't use it, you lose it.

So yeah, it's the cardholder's money which he has to consume through travel and obtaining said credit.

mikesyr18

Proof?

goodeats21

Agree that 5/24 is not going to be a driver for any agreement. It is just too small a population that it effects. And it is not a group that provides a big value for the ROI.

Hard telling what United thinks they can "enhance" in their agreement. They already linked PQD waiver to spend on their card. They can't go too far on experiential benefits as many travelers are forced to use Corporate cards, and this is not a group to alienate.

I doubt they want to limit transfers of UR to M+, as this has to be a big source of income, with Chase buying the miles.

I don't think United has a lot of leverage, but interesting to watch the developments.

goodeats21

GAAP.

mikesyr18

I completely agree with the people who are pointing out the lost value in airline credit cards. It seems like airlines need to go back to the negotiating table and come up with a plan to give more points per dollar on both airline and non-airline spend... The 2x/1x platform doesn't really cut it anymore when you can get 5x on airline purchases when using an AMEX Plat or 4.5x on dining with the Chase Sapphire Reserve without transferring points over.

The only positive I see from airline cards are companion tickets (AMEX Delta cards), free checked bags (all airline cards basically), and priority boarding, but those perks don't generate interchange fees.

mikesyr18

Unless you know the ins and outs of Chase's accounting procedures, that's not proof. I'd like to see text that states where Chase is pulling airline reimbursement fees from.

goodeats21

And most of those perks are really useless for customers that have status. I have long thought that a big hole in the United CC offerings is a card tailored to high status members.

goodeats21

No one outside of Chase is going to have text that states their internal procedures and accounting specifics.

GAAP certainly recognizes how revenue with a subsequent liability is handled. Not that it makes a whit of difference to the conversation at hand here.

mikesyr18

So the answer is there's no relevant proof.

Agreed. I admit I'm someone who has to look up the perks for those with FF status, but I do know many airline co-brand cards need a serious overhaul.

drminn

I pretty much agree with your statement, but in the end I don't think UA cares which credit card people use, what they really care about is the miles that people (via Chase) buy from them.

Enticing people to use the UA credit card amounts to a "forced" buy, as UA miles is the only reward you can get. This may work, but I doubt it for a number of reasons that have been discussed here.

Using CSP or CSR as my main card, even for UA flights, I am potentially buying more miles (3x vs 2x). However, as UR points are transferable to other rewards currencies, the real problem lies in the lack of attraction and perceived value of UA miles, e.g. difficulty of redeeming for reasonable flights.

It seems to me the straightforward solution would be to enhance the perceived value of the UA miles. If people don't buy your product because they don't think it has value vs. the competition, enhance its value.

Statman

I have no idea what you are ranting about because I am sticking with facts and it is YOU who is speculating.

FACT - the definition of refund is according to Merriam-Webster Dictionary is "to give or put back" or "to return (money) in restitution, repayment, or balancing of accounts."

FACT - you only get up to $300 dollars REFUNDED to you after you purchase qualifying travel services.

mikesyr18

Those aren't facts.

I'm glad people know the difference between a fact and speculation.

Let me add that it is not a $300 refund, it is a reimbursement. Look up the definition of reimbursement now. Chase does not make you pay an annual fee only to give you a partial refund back... That would be a pointless business tactic.

goodeats21

We are not privy to the terms of the United / Chase relationship, but I would imagine that United gets a better "return" in some manner when people obtain (sign up bounty of some type) and use (transaction traffic) the United Cards. It is not just about the redeemable miles.

As to the "value" of the miles, United has to be a bit careful as they also give out miles at their own cost, when members actually fly. Enhancing the value of miles means a hit on United costs.

A lot of levers available to pull in this game. It will be interesting to see what develops.

RNE

I, on the contrary, have 660k United miles, find it easy to get awards to the places I want to go, yet, like you, I have no use for my Explorer card. Chase has hobbled it with the CSR. Surely, United realizes this.

RNE, don't call me Shirley.

RNE

"Too small"? According to Creditwise, here are the percents of people with credit scores who have opened x number of credit cards in the last 2 years.

<3 cards: 58%
3-4 cards: 21%
5-6 cards: 10%
>6 cards: 11%

Thus, 21% are affected. Not a small amount, methinks.