jn in ca

If only that was true. Unfortunately, the regulatory environment makes the work of the free market really tough these days. The US is nowhere close to seeing a big new airline (Peoplexpress II anyone?), and as much as I like Jetblue, Virgin America and Alaska, I know it will be many years before any of them will really disrupt a UA fortress hub, although I will be rooting for them.

^ I see a number of good comments about the 75k cap. I think the explanation was alluded to earlier: someone at UA ran the numbers and saw some 1ks earning 250k miles for each ticket, and then reminded management that people buying tickets in that price range are NOT buying them for the miles.

That's a fun tidbit. I'd never thought of it that way, but you are right. Good point, if I ever need 300,000 MP miles. I won't.

No one knows, because it is a VERY closely guarded secret, but we know that UA/Chase is not a marriage of equals. These card agreements were hashed out when Chase was sitting on a pile of cash, and UA was googling "bankruptcy" and sorely needed the revenue. Chase is getting a heckuva deal.

The real problem is not the earning, it is the billions of unredeemed miles already sitting in all the FF plans. There is simply no way the big 3 legacy carriers could ever redeem all those miles, so they devalue them, and their accounting works on the assumption that most of those miles will never be redeemed.

IOW, do not stockpile miles. Use them, before the next devaluation.

doctorwine

I am 1k. I flew 45 segments last year mostly sfo to asia. I had similar travel the year before and this year is no different. I spend quite a bit of money with them. This announcement has made me really sad. I do not look at other airline tickets but that is going to change. Each year they have devalued their rewards program. This new accrual method pretty much kills their rewards program for me. I'll probably switch to Cathy or Singapore and buy from a company who appreciates my business.

Tchiowa

Absolutely. On my SFO/BKK route if I use points and dollars to upgrade it's $600 plus points each time. 6 upgrades = $3,600 plus a ton of miles. Would I pay $1,000 to get to 1k and get my GPUs? Yup.

$40 for 4 nights at a Marriott? Where did you stay. Marriott Barns R Us?
:-)

Wise-Broccoli8301

Welp.... This makes things really difficult for me. PQD already screwed me over because I fly on *A partners (hate United for international), and this looks like the nail in the coffin. However, Churning is pretty much same as usual

GUWonder

Sorry, it was $80 (pre-tax) for the 4 one-night stays / c. $20/night.

It is a nice Courtyard Marriott within jogging distance to the White House.

flyerguy99

I just did a back of the envelope calculation, and under the new system I would have earned about 1/4 to 1/3 as many miles, i.e., 75-65% fewer with the new system as I actually did under the current distance system. My UA flights tend to be cross-country or transatlantic. Factor in the recent increase in miles needed for awards too, and going forward, loyalty to UA is worth about 80% less to me than it was a year ago.

Then again, in recent years the feeling I've got from UA is that the loyalty of a measly several times a year, economy class flyer like me is worth 99% less to them than it used to be, so I guess it's all fair...

uastarflyer

You don't need to jack one group to placate another. Just add a spend RDM calculator to the existing mileage one

You and others make this so binary. Either, not Or, is also an option.

AA_EXP09

Good luck with CX going to an UG by bid system (also should be spelt cathAy)
That being said as it is, CX is already a much better airline than UA (I have flown both in Y and J.)
SQ I find is highly overpriced (though in some cases you can get cheaper like the SQ RTW deal and one time through IRROPS BA put me in SQ J rather than CX J. Granted I was flying LHRHKG which commands a higher premium direct...)

Tchiowa

Actually I think they do need to jack one to help the other. Reason is simple. If you give one group more and another group less you can make it a zero sum process: It doesn't cost UA any money.

But if you give one group more and don't change the others, the net result is increased costs.

If they have a budget for how much RDM will cost them per year, they are simply changing what percent of that budget each group gets rather than increasing the budge.

IainC

I emailed MP this morning expressing my unhappiness with the introduction of value-based miles earning. Surprised to get the response below back within 5 min! The copy-cat mentality and lack of innovation is quite apparent, not to mention the delusion that this will help UA to be more competitive against other airline programs! Whoa, when your hard and soft product are at the bottom of the heap and you are losing bucks hand over foot, just the right time to pull out the sucker punch.


Hello Mr IainC,

We’re glad to hear from one of our most loyal customers. Not many can say they've flown more than two million miles! Thanks for writing.

Thank you for taking the time to write to us about your concerns regarding the changes to the 2015 MileagePlus program.
Our goal is to develop an award program that is valuable to our members while remaining competitive with other airline programs. The industry is moving in the direction of rewarding the loyalty of high-value customers. We also want to directly recognize the value of our members when they fly United.

While some travel will offer you fewer award miles with these changes, there will be instances where you will earn more award miles based on your ticket price than you would have earned based on the distance flown.

Keep in mind, there will not be any changes to the 2015 Premier qualification requirements. Premier status will continue to be earned by Premier qualifying flights, segments and dollars (if applicable). Premier qualifying flights will continue to be based on the distance of the flight, including applicable fare class percentages.

We appreciate your loyalty to United and hope you will allow us the opportunity to earn your business in years to come.

We appreciate you taking the time to contact us.

Regards,

XXXX

MileagePlus

chitownflyer

It is regretful that United and Mileage Plus do not listen to the dissatisfaction of the changes made to the 2015 program, but they are intent on copying Delta without thought to the consequences of alienating both their elites and general customers.

LarkSFO

Are these things knowable by us here on FT?

Knowing (or having the educated estimates of a quorum of smart FT'ers) these numbers could help peel back the financial basis (at least in UA's bean counters minds) of these changes.

- What does UA keep miles (liability) on it's balance sheet for? (DL?)
- We know what you can buy them for 'retail': .021 (Maximizer at it's lowest) to .033 cpm
- At what price does Chase buy miles from UA? Anybody here have any idea?
- We know redemption value can vary greatly depending upon what the price of the ticket is that you are using miles for. .005 - .075 cpm?
- We know you can use your miles to shop at about .01 cpm

sogboulder

Yeah, if he puts his horse on the Board of Directors I am definitely switching to AA.

aussieinsf

I just love this:

"The industry is moving in the direction of rewarding the loyalty of high-value customers."

I would have considered myself a fairly high value customer (1.3 MM, 75k miles a year, about $7,500 PQD) so apparently worthy of Platinum status without CC spend. Yet United just reduced the RDM I will earn each year by flying from about 130k to about 70k. Clearly this change is not rewarding to me. If I am spending $7,500 a year and being given a fairly high level of status how am I not a "high value customer"?

username

UA would say, "I knew HVF. HVF was a passenger of mine before switching to AA. aussieinsf, you're no HVF"