AMEX and Delta created a 3 headed monster and now need to regroup
#1
Original Poster
Join Date: Sep 2023
Posts: 66
AMEX and Delta created a 3 headed monster and now need to regroup
AMEX has 5 billion reasons to to reevaluate the business model and Delta is at their feet. From the outside this looks like Delta basically saying "Spend, or no lounge access" I think AMEX said "Hey Delta thanks for signing up so many people, appreciate it, but they only use the card to access the lounges. We pay you 40 million dollars a month and we have our own lounge network." Amex has its own growing Lounge network and frankly the only reason I have a platinum card is for the lounges. I don't care about miles and free flights. I used to. I think we all did. Now? Not so much. Lounges have surpassed free flights and have become a stand alone product that gets new users. I think Delta knows what's coming up the pike from Amex. Amex won't be paying them as much in the future, they have Centurion product that people know about and are willing to pay for without the Delta affiliation. It doesn't go from 5 billion to zero, but will maybe go from 5 billion to 3 billion. Delta needs to cull the herd to keep their high net flying customers happy because when all of this shakes out, they need those customers to make up for the future Amex revenue reduction. It's Amex that holds the cards now. They are taking it in-house.
Last edited by jfktocdg; Sep 14, 2023 at 7:40 pm
#2
Join Date: Feb 2013
Programs: Hilton Diamond
Posts: 4,269
I have been watching these moves wondering exactly what was up behind the scenes and I had a feeling that AMEX (or more specifically the behind the scenes interactions/negotiations between AMEX and Delta in their mutual lusty pursuit of profits). I have also been wondering if Delta has eyes on a new Non-Amex CC relationship in its future based on what is going on. Once the Centurion Lounges started to pop up in a lot more locations, you knew AMEX was eventually going to start to strong arm Delta. Try to give them a lot less per swipe and at the very time Delta wants more.
#3
Original Poster
Join Date: Sep 2023
Posts: 66
I have been watching these moves wondering exactly what was up behind the scenes and I had a feeling that AMEX (or more specifically the behind the scenes interactions/negotiations between AMEX and Delta in their mutual lusty pursuit of profits). I have also been wondering if Delta has eyes on a new Non-Amex CC relationship in its future based on what is going on. Once the Centurion Lounges started to pop up in a lot more locations, you knew AMEX was eventually going to start to strong arm Delta. Try to give them a lot less per swipe and at the very time Delta wants more.
#4
Moderator: Delta SkyMiles, Luxury Hotels, TravelBuzz! and Italy
Join Date: Oct 2001
Location: Los Angeles
Posts: 26,544
AMEX has 5 billion reasons to to reevaluate the business model and Delta is at their feet. From the outside this looks like Delta basically saying "Spend, or no lounge access" I think AMEX said "Hey Delta thanks for signing up so many people, appreciate it, but they only use the card to access the lounges. We pay you 40 million dollars a month and we have out own lounge network." Amex has its own growing Lounge network and frankly the only reason I have a platinum card is for the lounges. I don't care about miles and free flights. I used to. I think we all did. Now? Not so much. Lounges have surpassed free flights and have become a stand alone product that gets new users. I think Delta knows what's coming up the pike from Amex. Amex won't be paying them as much in the future, they have Centurion product that people know about and are willing to pay for without the Delta affiliation. It doesn't go from 5 billion to zero, but will maybe go from 5 billion to 3 billion. Delta needs to cull the herd to keep their high net flying customers happy because when all of this shakes out, they need those customers to make up for the future Amex revenue reduction. It's Amex that holds the cards now. They are taking it in-house.
Obscure2K
Delta Moderator
#5
Original Poster
Join Date: Sep 2023
Posts: 66
And I'll add that as a frequent flyer out of JFK, I love the Delta product and I hope that that Amex takes some of those Delta billions and shifts them to Priority Pass. I don't use the Delta lounges that often and could live without them if I could consistently get into Centurion, they keep expanding and they take the Priority Pass lounges. Frankly, if I'm being totally selfish and could wave my wand? Keep the Centurion Lounges and the PP lounges exclusive to Amex Platinum ONLY. Not Delta Amex, not this or that Amex, Just Amex Platinum. And, Essentially buy Priority Pass lounges. If AMEX ever wants to make a foothold in Europe this is the gangster move.
#6
Join Date: Jan 2009
Location: WAS
Programs: AA EXP2M, DL 1MM DM ext, UA PP <=> HH G/Marr PE/Hyatt G/IHG P FT RA ( Recovering Addict)
Posts: 4,596
Welcome to FT!
Sorry - you are wrong on both counts
Amex had Costco - fully 10% of all their spend
Amex had SPG - 15% of all amex spend - evaporated after Marriott devalued SPG amex earn rates
They lost both!
They had to hand on to DL as the last major loyalty program. DL is the single major program for Amex.
Amex once had SW, CO as transfer partners ; now firmly under Chase umbrella along with UA.
Amex Platinum once offered AA lounge access as well as DL lounge access.
Amex charge card and credit volume will take a huge hit if DL goes with Citi or Chase.
Amex does not hold the cards - DL does - as long as spend increases on the DL cards (as it did 60% DURING the pandemic years) DL can devalue all they want
Can you believe the spend on DL cards is 1% of entire US GDP?
AND people were spending MORE on the DL cards during the time they were stuck at home and travel was not easy and cash was safe?
Most folks have no idea and just look at the vague advertising promising a fantasy.
Amex had Costco - fully 10% of all their spend
Amex had SPG - 15% of all amex spend - evaporated after Marriott devalued SPG amex earn rates
They lost both!
They had to hand on to DL as the last major loyalty program. DL is the single major program for Amex.
Amex once had SW, CO as transfer partners ; now firmly under Chase umbrella along with UA.
Amex Platinum once offered AA lounge access as well as DL lounge access.
Amex charge card and credit volume will take a huge hit if DL goes with Citi or Chase.
Amex does not hold the cards - DL does - as long as spend increases on the DL cards (as it did 60% DURING the pandemic years) DL can devalue all they want
Can you believe the spend on DL cards is 1% of entire US GDP?
AND people were spending MORE on the DL cards during the time they were stuck at home and travel was not easy and cash was safe?
Most folks have no idea and just look at the vague advertising promising a fantasy.
#8
Join Date: Sep 2002
Location: NOVA
Programs: IHG Rewards Platinum, Marriott Gold, Hilton Diamond, UA/DL/AA Back of the plane...
Posts: 4,613
And I'll add that as a frequent flyer out of JFK, I love the Delta product and I hope that that Amex takes some of those Delta billions and shifts them to Priority Pass. I don't use the Delta lounges that often and could live without them if I could consistently get into Centurion, they keep expanding and they take the Priority Pass lounges. Frankly, if I'm being totally selfish and could wave my wand? Keep the Centurion Lounges and the PP lounges exclusive to Amex Platinum ONLY. Not Delta Amex, not this or that Amex, Just Amex Platinum. And, Essentially buy Priority Pass lounges. If AMEX ever wants to make a foothold in Europe this is the gangster move.
edit: removed BA comment - looks like it is no longer PP. Not surprised with AF/VS/TK/LH lounges all PP the BA one was the worst on the list (been to BA plus all except VS)
#10
Join Date: Apr 2005
Location: Fort Worth, TX
Programs: Delta DM, United Silver, Marriott LT Platinum, Hyatt Discoverist
Posts: 854
They said Amex had Costco. And they lost them in 2016. It was big news back then. Same with SPG which was a great Amex product and the replacement Marriott card is nowhere near as good.
#11
Join Date: Jan 2014
Programs: Amtrak Guest Rewards (SE), Virgin America Elevate, Hyatt Gold Passport (Platinum), VIA Preference
Posts: 3,134
#13
Join Date: Jan 2014
Programs: Amtrak Guest Rewards (SE), Virgin America Elevate, Hyatt Gold Passport (Platinum), VIA Preference
Posts: 3,134
[I basically only use my ex-Starwood Amex (the old design was better!) for the occasional stay at a Marriott property. It resides in the back of my wallet otherwise. When it was a Starwood card, it was my go-to card for unbonused spend. 1x Starwood points=1.25 points with their transfer partners, so the question was that vs my Chase FU card. 2 Bonvoy points=0.83 points with their transfer partners...]
#14
Join Date: Apr 2005
Location: Fort Worth, TX
Programs: Delta DM, United Silver, Marriott LT Platinum, Hyatt Discoverist
Posts: 854
The card isn't bad. The program is a lot weaker, however.
[I basically only use my ex-Starwood Amex (the old design was better!) for the occasional stay at a Marriott property. It resides in the back of my wallet otherwise. When it was a Starwood card, it was my go-to card for unbonused spend. 1x Starwood points=1.25 points with their transfer partners, so the question was that vs my Chase FU card. 2 Bonvoy points=0.83 points with their transfer partners...]
[I basically only use my ex-Starwood Amex (the old design was better!) for the occasional stay at a Marriott property. It resides in the back of my wallet otherwise. When it was a Starwood card, it was my go-to card for unbonused spend. 1x Starwood points=1.25 points with their transfer partners, so the question was that vs my Chase FU card. 2 Bonvoy points=0.83 points with their transfer partners...]
Then they transferred the Starpoints to Marriott at 1:3 and the new card earned...2 Marriott points per $1.
I liked the design too, very classy. Even the old burgundy colored one before they issued the violet ones.
#15
Join Date: Jan 2014
Programs: Amtrak Guest Rewards (SE), Virgin America Elevate, Hyatt Gold Passport (Platinum), VIA Preference
Posts: 3,134