Presidential Plus Card Changes

Old Feb 4, 2012, 5:26 pm
  #1261  
 
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Originally Posted by CollegeFlyer
I agree with your first paragraph. But personally, I don't think people buying 1K outright with FEQMs was actually a major concern for UA. UA used to sell 1K outright for $20,000 IIRC (and it came with a $21,000 credit towards UA travel) with the UA prepaid travel card.
Here is the press release from the Prepaid Travel Program:

http://www.united.com/press/detail/0,6862,52653,00.html
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Old Feb 4, 2012, 7:42 pm
  #1262  
 
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Originally Posted by CollegeFlyer
at 1,000 EQM for $5,000 Chase spending, buying 1K outright would require $500,000 in spending, which is much more than UA was previously selling 1K for, so I suspect that UA/Chase would be okay with that.
Um... it's not like Chase pockets the 500K...
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Old Feb 4, 2012, 8:51 pm
  #1263  
 
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Originally Posted by TomA
Um... it's not like Chase pockets the 500K...
No, but at 2.1% discount it produces about $10k of revenue for Chase. I bet only a fraction of that ends up in UACO's pocket, so they're selling 1K for ... less than $20k
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Old Feb 5, 2012, 4:02 pm
  #1264  
 
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Originally Posted by jmr50
No, but at 2.1% discount it produces about $10k of revenue for Chase. I bet only a fraction of that ends up in UACO's pocket, so they're selling 1K for ... less than $20k
Following up on jmr50's calculation, remember that Chase is also providing 500,000 RDMs to the cardholder in addition to the 100,000 FEQMs.

Does anyone know how much credit card companies pay airlines for their miles? I'll assume $0.01 to $0.02 until someone can provide more definitive information.

At that rate, Chase is already paying UA $5,000 to $10,000 for the RDMs. So Chase now has between $500 and $5500 to pay for the 100,000 FEQMs.

BTW, the prepaid travel card people have been describing sounds more like a "GS-lite" program in that it provides annual UA status for annual UA spend. Either that or they're kind of assuming that if you're going to spend $20,000 on UA in a year you're going to get 1K. It does sound generous in that if you're going to buy 4 C round trips to Europe or Asia for your 20k, you would normally only make 1P. OTOH, if you're flying economy, you're definitely going to make 1K. I bet it's a good bargain because the 4x C international traveler is not going to use many 1K benefits and is otherwise a prime catch for the airline, profitability-wise.
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Old Feb 5, 2012, 6:57 pm
  #1265  
Formerly known as CollegeFlyer
 
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Originally Posted by TomA
Um... it's not like Chase pockets the 500K...
UA didn't pocket the $20K used to buy the status either; instead, it provided $21K (5% bonus) of credit to use to purchase UA flights (for yourself or other people). UA just earned the profit margin on the flights you ultimately purchased, just as Chase earns its cut on the $500K you spend. And this was at a time when airline profit margis were low, and excess capacity was still high, so you could find $225 transcon fares (for example) just about anytime except the Holidays if you booked a month in advance. So, UA's average profit margin on the sold tickets would have been lower than it is now.

The UA travel credit was refundable at a 50% loss, so even in the most extreme scenario (passenger buys 1K for $20k and then never spends any of the credit), at most UA would be pocketing $10k. But that must have been a very rare occurrence, if it ever happened.

Originally Posted by lensman
Does anyone know how much credit card companies pay airlines for their miles? I'll assume $0.01 to $0.02 until someone can provide more definitive information.
It might be $0.01 or maybe a little more, but I highly doubt that it's anywhere near $0.02

On the Chase Sapphire card for example, 1 Ultimate rewards point is worth 1 cent if you use it for cashback (statement credit); but if you use it for UA miles, it's worth 1 mile. If UA was actually charging Chase 2 cents per mile (double what Chase would pay to the cardmember in cashback), then Chase would be losing a bunch of money by offering the mileage transfer option, and the ratio would be adjusted to be more like 2 points = 1 mile, or something like that.

Last edited by iluv2fly; Feb 5, 2012 at 11:34 pm Reason: merge
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Old Feb 5, 2012, 7:51 pm
  #1266  
 
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Originally Posted by CollegeFlyer
It might be $0.01 or maybe a little more, but I highly doubt that it's anywhere near $0.02
I agree and actually think the most likely figure for how much Chase pays for RDMs is $0.01. I suppose I should have published my view of the probability distribution of the price being between $0.007 - $0.02?

BTW, nothing says that Chase can't pay more for RDMs than they would get for offering cash for Sapphire points. And not to derail the conversation, but it seem somewhat unusual for Chase to be offering a 1% cash back credit card with no annual fee. It's not unprecedented but is a much better offer than a top-tier bank like Chase normally offers. Of course, this speaks for miles costing them less than $0.01.

I think that at less than $0.01 per RDM, UA runs into issues with selling RDMs at a price that is too close to their accounting value net costs of administering the program. I do think they could be selling as low as $0.07 or so.

OTOH, I think Chase could be paying more than $0.01 because of the co-branding agreement and that they would be getting access to UA's customers - who might be highly desirable from the perspective of credit card marketing.
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Old Feb 8, 2012, 1:47 pm
  #1267  
 
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I agree and have discussed before that the change in this card that makes it of marginal utility to a 1k flyer is the limitation on FLEX EQMs counting towards 1k status.

Does anyone else feel it is infuriating that the mailings cardholders are getting still use wording like "the sky's the limit" and "Flex EQms can be added to your flight miles to reach, maintain, or upgrade your elite status level"? And then don't clarify even in the fine print on the mailing, except to say "See ...Rules and Regualtions...for details"?

Had to vent.

Scott
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Old Feb 8, 2012, 1:59 pm
  #1268  
 
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Originally Posted by Tinman
I agree and have discussed before that the change in this card that makes it of marginal utility to a 1k flyer is the limitation on FLEX EQMs counting towards 1k status.

Does anyone else feel it is infuriating that the mailings cardholders are getting still use wording like "the sky's the limit" and "Flex EQms can be added to your flight miles to reach, maintain, or upgrade your elite status level"? And then don't clarify even in the fine print on the mailing, except to say "See ...Rules and Regualtions...for details"?

Had to vent.

Scott
Yeah... that was one of several reasons I cancelled it.

I'd love to know if there are any international 1K flyers that have kept this card beyond the free period and if so, why?
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Old Feb 8, 2012, 9:17 pm
  #1269  
 
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Originally Posted by CollegeFlyer:17947364
Originally Posted by FoulWeather
A couple of weeks after my credit card came a Hyatt Gold Passport letter arrived in the mail. It basically welcomed me to the program and had my password to the website which I should use with my member number that was in the intro packet that was sent. Well the intro packet was never sent or at least it didn't reach me.

I called Hyatt GP (I think I just used a number I found on their website) and customer service was able to look up my membership information. Apparently it was created automatically when I received the Chase PP card but not everything got to me via USPS. At that point I could log in to the Hyatt Gold site and was good to go. They sent out a kit a few weeks later that had my Hyatt Gold Passport Platinum card (Gold Platinum, I feel so blingy...)
Thanks for the advice! Hyatt had me in the system, under my (very) old account number. It looks like they upgraded it to Platinum for me in November 2011*, but never sent me a new card or a letter.

* This is a guess, because it is showing Platinum now, and the most recent entry in my online account statement is an entry called "award" in November 2011, with no miles awarded/deducted, so I'm guessing that that is how the status upgrade shows up.
I just called Hyatt (this am) and told then i had the PP card and what did i need to do to get my plat membership with them. He put me on hold while he checked with somebody (supervisor he said), came back on the line and took my info. Total time involved about 5 minutes and i now have platinum status with Hyatt. (He gave me my membership number on phone and a temp password via email. I logged on and it showed platinum within minutes)
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Old Feb 9, 2012, 3:35 am
  #1270  
 
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I find it amusing that it looked like my travel frequency was going to go down significantly (only barely made 25k last year) so I kept the PP cards to try and get back to at least gold.

Well, it suddenly appears I'm not going to have any trouble making plat this year given I'll probably be flying 40k miles in March alone. Which now makes the PP card essentially useless.

Even the RDM kinda suck, since it seems nigh impossible to redeem them for international upgrades.
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Old Feb 9, 2012, 6:42 am
  #1271  
 
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Originally Posted by Photonerd71
I just called Hyatt (this am) and told then i had the PP card and what did i need to do to get my plat membership with them. He put me on hold while he checked with somebody (supervisor he said), came back on the line and took my info. Total time involved about 5 minutes and i now have platinum status with Hyatt. (He gave me my membership number on phone and a temp password via email. I logged on and it showed platinum within minutes)
This is why I love Hyatts!!!
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Old Feb 9, 2012, 11:21 am
  #1272  
 
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Speaking of the Hyatt Gold Passport platinum membership, has anyone passed the 1 year point and had theirs renew?

When I log into my Hyatt account, it shows that my platinum status expires on Feb. 28. I just happen to have an upcoming stay that starts on Feb. 28 and continues for a week after that. Who takes care of renewing the platinum status (Hyatt or Chase) and how close to the expiration date do I need to start worrying that it isn't going to auto-renew?
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Old Feb 9, 2012, 5:29 pm
  #1273  
 
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Originally Posted by electroflyer
Speaking of the Hyatt Gold Passport platinum membership, has anyone passed the 1 year point and had theirs renew?

When I log into my Hyatt account, it shows that my platinum status expires on Feb. 28. I just happen to have an upcoming stay that starts on Feb. 28 and continues for a week after that. Who takes care of renewing the platinum status (Hyatt or Chase) and how close to the expiration date do I need to start worrying that it isn't going to auto-renew?
My Hyatt Platinum Status has renewed like clockwork each year I have been a PPlus cardholder.

Dan
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Old Feb 10, 2012, 9:33 pm
  #1274  
 
Join Date: Aug 2011
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Originally Posted by dan1431:17985633
Originally Posted by electroflyer
Speaking of the Hyatt Gold Passport platinum membership, has anyone passed the 1 year point and had theirs renew?

When I log into my Hyatt account, it shows that my platinum status expires on Feb. 28. I just happen to have an upcoming stay that starts on Feb. 28 and continues for a week after that. Who takes care of renewing the platinum status (Hyatt or Chase) and how close to the expiration date do I need to start worrying that it isn't going to auto-renew?
My Hyatt Platinum Status has renewed like clockwork each year I have been a PPlus cardholder.

Dan
I asked about that when i was on the phone with Hyatt and that is what he said. It will just renew automatically.

Originally Posted by edcho:17981627
Originally Posted by Photonerd71
I just called Hyatt (this am) and told then i had the PP card and what did i need to do to get my plat membership with them. He put me on hold while he checked with somebody (supervisor he said), came back on the line and took my info. Total time involved about 5 minutes and i now have platinum status with Hyatt. (He gave me my membership number on phone and a temp password via email. I logged on and it showed platinum within minutes)
This is why I love Hyatts!!!
The funny thing is I've never stayed ay a Hyatt. I've been using Hilton the last few years and decided to let my Hilton status drop now that i am basically locked into Hyatt status. I did a couple quick random price checks and found them to be reasonably close with Hilton, so i shall see as the year goes on how it works for me.

Last edited by iluv2fly; Feb 10, 2012 at 11:24 pm Reason: merge
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Old Feb 11, 2012, 3:59 pm
  #1275  
 
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I have been trying to stay at hyatt to take advantage of the status, but seems they never have a hotel where I go.
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