UA MP Shifting Focus to Grants vs Currency
Apr 6, 2019, 9:44 pm
#16
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I actually think that free E+ seats are one of the most valuable and overlooked benefit of status on any airline, particularly for people who do mostly domestic travel. Paying for it every time really adds up. On a transcon it can easily add 50% - 100% to your fare. I'm not willing to fly regular economy (when I've been on airlines where I've had no status I've always paid for E+) so, for me, that benefit is easily worth something like $2000 per year if I'm flying economy, and it's the main reason that I continue to maintain status. If not for that, the "free agent" argument would make sense for me. Now that I'm moving to paid F for longer trips, I might have to rethink this, though.
Apr 6, 2019, 11:03 pm
#18
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Shareholders have no values except profit. The focus on shareholder value above all else, rather than stakeholder value, is accelerating the decline of the USA as a great nation, just as it is accelerating the decline of the major airlines like UA. Hopefully stakeholder value becomes the next MBA trend but I’m not confident about this.
Apr 6, 2019, 11:19 pm
#19
Join Date: Sep 2009
Programs: UA GS>1K>Nothing; DL DM 2MM; AS 75K>Nothing>MVP
Posts: 9,341
No way. You can generally get a saver award for any seat where there is an upgrade-able fare available. The max value of a GPU is therefore the difference in cost between the upgrade-able fare and the cost of miles for the saver award. Miles can be had for $0.02. That puts the max value of a GPU at around $300 or $400 assuming no breakage.
Apr 6, 2019, 11:34 pm
#20
Moderator: United Airlines
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Apr 7, 2019, 12:19 am
#21
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Join Date: Jan 2018
Programs: UA LT GS | UA LT Club | Marriott LT Titanium
Posts: 1,250
No way. You can generally get a saver award for any seat where there is an upgrade-able fare available. The max value of a GPU is therefore the difference in cost between the upgrade-able fare and the cost of miles for the saver award. Miles can be had for $0.02. That puts the max value of a GPU at around $300 or $400 assuming no breakage.
RT Saver to Asia = 150K miles. At .02/mile = $3K USD
W to Asia = $1100
Difference is $1900 so value is $950/GPU
I also don’t believe saver availability will be as plentiful as in the past with this devaluation
Apr 7, 2019, 4:04 am
#22
Join Date: Sep 2009
Programs: UA GS>1K>Nothing; DL DM 2MM; AS 75K>Nothing>MVP
Posts: 9,341
RT W at $1100 is best case. W when you want to book it for when you actually want to travel and where you want to go, with a high probability of an upgrade is almost always a lot more than $1100. Even with the best case scenario, GPU are only worth half of the $2k you suggested in the original post.
Apr 7, 2019, 5:00 am
#23
Join Date: Nov 2012
Programs: BA Bronze, United 1K, HH Gold, SPG Platinum, Marriott Platinum
Posts: 3,477
I actually think that free E+ seats are one of the most valuable and overlooked benefit of status on any airline, particularly for people who do mostly domestic travel. Paying for it every time really adds up. On a transcon it can easily add 50% - 100% to your fare. I'm not willing to fly regular economy (when I've been on airlines where I've had no status I've always paid for E+) so, for me, that benefit is easily worth something like $2000 per year if I'm flying economy, and it's the main reason that I continue to maintain status. If not for that, the "free agent" argument would make sense for me. Now that I'm moving to paid F for longer trips, I might have to rethink this, though.
Apr 7, 2019, 5:05 am
#24
Join Date: Aug 2002
Location: LA,NYC
Programs: AA-EXP 2.8 MM,UA-GS 1.3 MM,DL-PL,HH-DM,LH-SEN,Bonvoy-GL
Posts: 296
just used last minute for my parents from EWR to LHR when y was 2k and C was 6K OW got a 4K value per GPU
Apr 7, 2019, 5:43 am
#25
Join Date: Feb 2017
Location: Houston
Programs: UA 1K and Million Miler, *A Gold, Marriott Bonvoy Lifetime Titanium, Hertz Five Star,
Posts: 1,301
Isn't that a bit silly. Engaging in the black market closes your MP account and earns you a lifetime ban. The difference between a W fare and C fare is at least $2K for most Polaris flights. Many of us use all our certs every year, realizing at least $12K in value.
Even better than free. If the company is paying the $15K PMD, and I'm using the certs for personal vacations, etc. I'm actually making 15K!
Even better than free. If the company is paying the $15K PMD, and I'm using the certs for personal vacations, etc. I'm actually making 15K!
Apr 7, 2019, 6:40 am
#26
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Realize also that for a decade now, whenever MP has taken a big value hit, members at the top of the elite heap routinely express approval -- in the (faulty) view that "culling the herd" will result in richer benefits for those left standing. This has never, ever proven true. UA has no intention of giving even top elites anything more (why would they? You're still here) while giving everyone else less. The goal is not to transfer benefits from me to you. The goal is to not give anybody anything unnecessary. They won't even give you a decent plate of food in Polaris.
Last edited by BearX220; Apr 7, 2019 at 6:45 am
Apr 7, 2019, 8:17 am
#27
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I'm not trying to quibble over the value of the grants. I'm simply saying UA strategy for the MP Program, for the foreseeable future, is becoming clear. The last 1/2 dozen major changes to MP have favored those with status. I'm simply saying it may be better to maximize status instead of maximizing miles.
So not all changes have been positive is my point. This one stings quite a bit. Only at the end of 2020 will we be able to say if having fewer RPUs actually increased CPU percentages for 1Ks or not.
-RM
Apr 7, 2019, 8:18 am
#28
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Join Date: Jun 2005
Posts: 57,520
When "grants" are realized in erratic, hidden-formula, unpredictable ways at the sole discretion of the issuer, value to the grantee is entirely theoretical. Literally nothing to bank on. It's been a long time since I heard anyone express an iota of optimism about GPU redeemability. This total-value calculus is smoke and mirrors. (I got some options in a long-odds startup that I assign the same current value on my balance sheet as your GPUs; that is, $0.)
Realize also that for a decade now, whenever MP has taken a big value hit, members at the top of the elite heap routinely express approval -- in the (faulty) view that "culling the herd" will result in richer benefits for those left standing. This has never, ever proven true. UA has no intention of giving even top elites anything more (why would they? You're still here) while giving everyone else less. The goal is not to transfer benefits from me to you. The goal is to not give anybody anything unnecessary. They won't even give you a decent plate of food in Polaris.
Realize also that for a decade now, whenever MP has taken a big value hit, members at the top of the elite heap routinely express approval -- in the (faulty) view that "culling the herd" will result in richer benefits for those left standing. This has never, ever proven true. UA has no intention of giving even top elites anything more (why would they? You're still here) while giving everyone else less. The goal is not to transfer benefits from me to you. The goal is to not give anybody anything unnecessary. They won't even give you a decent plate of food in Polaris.
Apr 7, 2019, 9:10 am
#29
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People are obviously free to value their certificates however they like, and to the extent that the OP's point is "worry more about the perks of status than the ability to redeem miles," it's hard to disagree -- but if your valuations of the perks are so far off from reality, you're going to make a lot of economically poor decisions.
Apr 7, 2019, 11:23 am
#30
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But it only works on one airline. It doesn't work so well if you plan on being a free agent. If I only fly one airline I don't need the subscription; I'll get status and get it for free. If I take the "free agent" route then there is not much value in the subscription.
Honestly I think that for someone who flies economy most or all of the time, and flies enough to get status, the free agent approach gives up too much. Economy without status is a horrible experience. On the other hand if you are paying for premium cabin seats then it makes sense to just go with whatever product is best or cheapest for a particular flight.
Honestly I think that for someone who flies economy most or all of the time, and flies enough to get status, the free agent approach gives up too much. Economy without status is a horrible experience. On the other hand if you are paying for premium cabin seats then it makes sense to just go with whatever product is best or cheapest for a particular flight.