Baze

Sorry to reply to you but I feel I must. Companies have been doing this as long as there have been companies. Every time there is a bankruptcy the rules change, pensions get slashed, benefits get changed and not just in the airline industry. Companies merge and do the same thing. What UA is doing is not new to any business. It happens. Just ask the pilots whose pensions were slashed to minuscule levels when a bankruptcy happened. Just ask FFers whose programs went away when their airline was bought out. This is all nothing new.

CHIC SILBER

They are all on a race to the bottom

They might all be winners & we all lose

Those of us that had it so good for so long

can only be grateful for our memories

uastarflyer

Baze - all your examples are BK related or buyout of a troubled asset

In this case 2 companies combined nearly 50-50. Of course their assets and liabilities stick around

On that there is no doubt.

What can be debated is whether MM benefits arise to level of liabilities like a loan or accounts payable would be.

A court action would be one way of exploring the topic.

Baze

Ok, I'll give you that.

Are there any examples documented of changes to FF programs when 2 airlines merge 50-50? The results could be taken as precedent. Because you know if there is a precedent UCH will jump all over it as yet another reason to justify what they are doing.

joel67

I believe you were misinterpreting what they were reporting. While it may have been total lifetime miles earned, the number itself was meaningless. They were not using that number to award Million Miler status, or I would have been one myself back then. Possibly they started reporting BIS mileage at the same time they officially launched the MM program, but I really don't remember.

By the way, AA's recent switch to use something closer to BIS themselves is actually a big reason I'd rather not shift my loyalty to them. I feel like I missed the boat and would now have a much harder time hitting their MM levels than many others who have been charging up a storm. I'm still annoyed at UA's decision to let the CO people jump ahead that way, but at least they gave me a token bonus to make up some of the ground relatively lost.

dgcpaphd

Hello uastarflyer,

Thank you for your accurate post.

In connection with your statement -

"What can be debated is whether MM benefits arise to level of liabilities like a loan or accounts payable would be."

I invite your attention to the fact that the million-mile program is different from the general Mileage Plus program in that the million-mile program was singled out and specifically discussed in the FAQs section of united's official web site, united.com.

As most will recall, the FAQs and answers remained on united.com for about one year, beginning shortly after the merger was announced in 2010.

The announcements were removed only after I and other customers wrote to Foland in October of 2011 asking about the inconsistency. Many recall that Foland's only response for the announcements was that they were "regrettable" and "confusing."

Those answers from united.com's FAQs said that the million-mile program would not change and that the two annual regional upgrades would continue for life.

During the period the FAQs and answers remained on united.com, an unknown quantity of customers relied on those answers and continued to fly with UA. Obviously, UA made a lot of money while customers relied on those answers.

Many customers (including me and several friends) accelerated flying in order to reach million-mile status in accordance with what was announced ("advertised") on united.com concerning the million-mile program.

A company cannot legally take away something that has already been earned especially if reassurances were posted continuously to the company's web site for one year and just before the benefits were cancelled.

A reasonable person would believe such announcements considering they were posted on the airlines web site and were posted for such a long time.

Therefore, those FAQs became liabilities of the old UA which transfers to the new company.

Of course, the matter could become the basis for a class action if UA does not rescind its announced "changes" (demotions) to the million-mile program. But, that is another topic.
-

bmvaughn

Posting something on a website does not in and of itself generate an accounting/fiscal liability.

LGA1K

Easy for me to relate to most of the 2,700+ replies. I've already contacted UA, other Flyertalkers, and the press and was going to leave it at that, but the last post from pdx1M drew me back in. I'm a UA 1MM flyer based in NYC that went out of my way for years to reach 1MM status by:
-flying via IAD after UA discontinued NYC TATL
-connecting via ORD instead of non-stop while commuting 5 years to MKE
-booking UA during pilot and mechanic work actions

So my loyalty-based purchase decisions affected >$250,000 of spend, exactly what UA hoped for with their program. My two complaints with the new MM benefits :
-BIS indifference: The UA BIS and the CO EQM criteria were dramatically different. It undoes the bond developed by the BIS criteria to gross-up the miles.
-Status dilution--When my annual flying declines my status will be worth less because of the combined effect of grossing-up and Platinum level addition.

I agree completely with pdx1M. I don't think UA is doing anything illegal or immoral, just counterproductive. Offering 1-time recognition or adjustment to old-school BIS 1MM flyers would preserve the future mutual benefit of the accumulated good will.

Baze

When they combined the requirements they had a choice. Give the UA people the extra EQM they earned in a one time adjustment and then go back to the actual BIS criteria or remove all the extra EQM's that were not BIS from the CO people. I think they figured it was better to give people extra and hit the mark of 1MM (or multiple of) then take away and possibly put a lot of people below the 1MM mark. What would they do then? Take away the 1MM benefits from the CO people who did not qualify under UA rules? Grandfather them? It was a dilemma for them. It looks like they figured they would benefit more people and anger fewer by doing it the way they did. Now this was to just give the moniker of 1MM (or multiple of). As for the benefits changes, that has been discussed ad nauseum in this thread on both sides. And I still am not taking any sides in the battle.

SteamingAlong

I am well over 900,000 lifetime miles and want to be sure that the flights I select going forward qualify toward Million Miler status.

Although the website states "Starting January 1, 2012, flight miles on the new United (including Continental), Copa Airlines or Copa Airlines Colombia will accrue toward Million Miler status" it is not clear how several different codeshare flights will be viewed.

Currently I am looking at flights between EWR-YYZ and see a number of flights being sold on Co.com and United.com.

A. Continental Flight Number - operated by Colgan Air DBA CO Connection

B. Continental Flight Number - operated by Express Jet DBA CO Express

C. United Flight Number - operated by Air Canada

D. United Flight Number - operated by JAZZ DBA Air Canada Jazz

All of these flights seem to qualify 100% toward Elite miles but will any of them qualify for Million Miler/Lifetime miles?

Thanks.

Baze

The CO Connection/Express and UA Express flights count towards lifetime. The AC flights do not. CO Connection and UA Express are considered to be CO and UA metal. Any other partners/codeshares do not count towards lifetime. Must be UA/CO metal.

pdx1M

Flight number doesn't matter - operating carrier is the only qualifier for MM BIS miles going forward. UA metal and United Express carriers (and Copa) qualify. So your A and B would count but neither C nor D would.

lf tom

joel67,

Maybe I'm missing something here, but wasn't the way that UA counted lifetime miles before 1995, the way that CO has consistently counted them up until the merger? Is so, doesn't it seem equitable that UA members be treated in an equal manner?

It is likely that some class action attorney will find the challenge here to be more than he can forego. Then interrogatories can explore the equity issue.

As for the knotty question of whether miles are liabilities or accounts payable, I'd defer to dgCPAphd. But I remember fondly receiving about a dozen certificates from AA as part of a settlement after it increased the miles necessary to obtain a coach ticket from 20K to 25K. The funny thing is that the certificates were named in honor of the named plaintiff in the class action litigation. I'm sorry that I can't remember his name, but what a way to become immortal.

lf

pdx1M

UA didn't count lifetime miles before 95 for a MM program to my knowlege. While they may have reported some program life total back then it was not related to a MM program. So long as UA has had a MM program they have used BIS. CO, on the other hand, included EQMs which meant it included class of service bonuses, star alliance flights, and a limited number of CC miles associated with a specific CC that they offered. The new program had to find a way to have a single algorithm to count miles prior to the merger so they simply took the EQM rule. I.e., they went back and credited UA flyers with the sum of their EQMs - that's all that happened. This meant that both sets of flyers had their MM balances counted using the same algorithm. If UA made an error totaling up your EQMs from their history I am sure they will fix it if you can document that. However, things like car rental and hotel miles never counted in either program.

Xyzzy

I don't believe removal of anything on the CO side was possible as they didn't have the historical data necessary to do that. Never mind that if they did they would have to explain how some lifetime mileage balances went dwn at merge time. No -- that would cause another set of problems. What was done to even out the playing field with regard to lifetime balances was clearly one area where they did things right. I dare say that there would be far more complaints about this aspect of the merger if they had simply added the CO and UA balances and called that the new lifetime total.