How Much Would You Pay UA, if anything, for a AAirpass (Unlimited Flights for x Time)
#1
Original Poster
Join Date: Oct 2004
Location: Clinging to the edifices of a decadent past from the biggest city in America nobody really cares about.
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How Much Would You Pay UA, if anything, for a AAirpass (Unlimited Flights for x Time)
Stepping away from the market carnage I got to thinking about the story of how AA (and I think UA too? Maybe others?) offered an "AAirpass" in the early 80's. As I recall the airlines did it as they believed it was cheaper to raise capital in this manner than through other options. In the long run, AA seems to have underestimated the true cost of the program but AAirpass customers did survive AA's bankruptcy and their AAirpasses remain valid. I want to say UA had a similar program as well but cannot recall the details.
From wikipedia: https://en.wikipedia.org/wiki/AAirpass
AAirpass was a membership-based discount program offered by American Airlines to frequent flyers launched in 1981. The program is best known for a previous offering of unlimited travel on American Airlines and unlimited access to Admirals Club locations. Pass holders were offered terms of five years or lifetime.
When AA launched the program in 1981 the cost was $250,000 (or about $711,000 in 2020) and allowed the holder of the pass unlimited lifetime travel on AA. Basically imagine an IATP card where you could only buy tickets on AA for yourself and never had to pay the bill. An option existed to add a companion for an additional $100,000 (or about $285,000 in 2020). While the companion could change, the companion always had to accompany the passholder.
As the tickets were revenue tickets, points were earned for travel and subject to the T&Cs of AAdvantage.
Anyways the question I have for the UA forum is considering where we are at, is there an amount you would consider kicking over to UA for unlimited, lifetime, revenue-based, front cabin travel?
From wikipedia: https://en.wikipedia.org/wiki/AAirpass
AAirpass was a membership-based discount program offered by American Airlines to frequent flyers launched in 1981. The program is best known for a previous offering of unlimited travel on American Airlines and unlimited access to Admirals Club locations. Pass holders were offered terms of five years or lifetime.
When AA launched the program in 1981 the cost was $250,000 (or about $711,000 in 2020) and allowed the holder of the pass unlimited lifetime travel on AA. Basically imagine an IATP card where you could only buy tickets on AA for yourself and never had to pay the bill. An option existed to add a companion for an additional $100,000 (or about $285,000 in 2020). While the companion could change, the companion always had to accompany the passholder.
As the tickets were revenue tickets, points were earned for travel and subject to the T&Cs of AAdvantage.
Anyways the question I have for the UA forum is considering where we are at, is there an amount you would consider kicking over to UA for unlimited, lifetime, revenue-based, front cabin travel?
#3
Join Date: Jan 2005
Location: New York, NY
Programs: UA, AA, DL, Hertz, Avis, National, Hyatt, Hilton, SPG, Marriott
Posts: 9,452
I wonder if we might see a more consumer-oriented PassPlus product... pre-paying for a certain dollar-figure of travel and then a declining balance with a fare-basis discount or other perks.
Right now United's biggest issue, clearly, is cash flow, but I don't know if United would consider a lifetime AAirpass type of product.
Such a thing, in today's market (as depressed as it may be) would probably be worth in the neighborhood of $1m.
Right now United's biggest issue, clearly, is cash flow, but I don't know if United would consider a lifetime AAirpass type of product.
Such a thing, in today's market (as depressed as it may be) would probably be worth in the neighborhood of $1m.
#5
Join Date: Aug 2007
Location: Tx
Programs: AA, UA, WN
Posts: 812
Would depend on the terms since UA has set precedents recinding many intrinsic so called "lifetime" benefits. I think the sentiment is that with eroded trust UA has shown many flyers; would they sell me this pass with their "fingers crossed"? My 8 ball says....Most likely
#7
Join Date: Jun 2012
Posts: 3,381
discounts on some fare buckets, free statuses (depending on your buyin)s
United (UA) Pass Plus Secure/ Flex -- Benefits, Value, Questions .... [Consolidated]
https://www.texasmonthly.com/article...-tickets-back/
In 1981, American Airlines began selling unlimited AAirpasses. Over the life of the program, the company sold 65 unlimited AAirpasses to people including Michael Dell and Willie Mays. (The company last offered one for sale in the pages of the Neiman Marcus Christmas catalog in 2004 for a cool $3 million.)
(apparently no buyers for 3mm. so price should be between 1mm (present value of the passes sold in 1980) to 3mm, maybe less due to the currentn risk(
Last edited by paperwastage; Mar 18, 2020 at 2:05 pm
#8
Join Date: May 2009
Location: SIN (with a bit of ZRH sprinkled in)
Posts: 9,455
There were extremely high interest rates back then, which made the airlines turn to such measurements afaik - and yes, I doubt they'd do it again, at least not for anything below 2-3 million USD.
Considering they can (and will!) crack down on anything "funny" with a companion OR selling your miles against cash, you can't really make money out of it. If you're a super-heavy traveller anyway, you might come out positive of it after a few years (Assuming 1 million USD costs), but then the limitation on one airline will mean you don't have much choice. Plus, if they go out of business, it's bye-bye "lifetime". And as we can see right now, that's definitely an option for many airlines around the world!
I enjoy my job too much and while I like travelling, I'd not want to travel 7/24. Maybe if they'd allow selling miles, it would be an option to "refinance" that thingy by constantly flying. Zero costs of living, and IF you can do "work from home", it might be a possibility. A crazy one, but it could be an option..
Considering they can (and will!) crack down on anything "funny" with a companion OR selling your miles against cash, you can't really make money out of it. If you're a super-heavy traveller anyway, you might come out positive of it after a few years (Assuming 1 million USD costs), but then the limitation on one airline will mean you don't have much choice. Plus, if they go out of business, it's bye-bye "lifetime". And as we can see right now, that's definitely an option for many airlines around the world!
I enjoy my job too much and while I like travelling, I'd not want to travel 7/24. Maybe if they'd allow selling miles, it would be an option to "refinance" that thingy by constantly flying. Zero costs of living, and IF you can do "work from home", it might be a possibility. A crazy one, but it could be an option..
#11
FlyerTalk Evangelist
Join Date: Sep 2003
Location: Honolulu Harbor
Programs: UA 1K
Posts: 15,020
I wonder if airlines could price it based on age as a way to mitigate the liability? I know it would obviously be (inverse) age discrimination, but would it be against the law? Insurance industry can do it, not sure about airlines. Or offer a full price, then discount for seniors?
#12
Join Date: Jan 2005
Location: New York, NY
Programs: UA, AA, DL, Hertz, Avis, National, Hyatt, Hilton, SPG, Marriott
Posts: 9,452
thats passplus flex - it exists right now
discounts on some fare buckets, free statuses (depending on your buyin)s
United (UA) Pass Plus Secure/ Flex -- Benefits, Value, Questions .... [Consolidated]
https://www.texasmonthly.com/article...-tickets-back/
In 1981, American Airlines began selling unlimited AAirpasses. Over the life of the program, the company sold 65 unlimited AAirpasses to people including Michael Dell and Willie Mays. (The company last offered one for sale in the pages of the Neiman Marcus Christmas catalog in 2004 for a cool $3 million.)
(apparently no buyers for 3mm. so price should be between 1mm (present value of the passes sold in 1980) to 3mm, maybe less due to the currentn risk(
discounts on some fare buckets, free statuses (depending on your buyin)s
United (UA) Pass Plus Secure/ Flex -- Benefits, Value, Questions .... [Consolidated]
https://www.texasmonthly.com/article...-tickets-back/
In 1981, American Airlines began selling unlimited AAirpasses. Over the life of the program, the company sold 65 unlimited AAirpasses to people including Michael Dell and Willie Mays. (The company last offered one for sale in the pages of the Neiman Marcus Christmas catalog in 2004 for a cool $3 million.)
(apparently no buyers for 3mm. so price should be between 1mm (present value of the passes sold in 1980) to 3mm, maybe less due to the currentn risk(
OTOH, $10k up front for ~15k in value down the road, might be more palatable. In any event, I imagine UA is considering things like this. Open tickets are another possibility?
#14
FlyerTalk Evangelist
Join Date: Oct 2001
Location: Austin, TX
Posts: 21,406
For the purposes of the discussion -- it's a hypothetical, after all -- figure that they would be treated as bulk fares that booked into P. Those earn 30% of the distance as PQP. (distance * 1.5 / 5)
#15
Join Date: May 2009
Location: Washington, DC
Programs: UA 1K 1MM, AA, DL
Posts: 7,418
I wonder if airlines could price it based on age as a way to mitigate the liability? I know it would obviously be (inverse) age discrimination, but would it be against the law? Insurance industry can do it, not sure about airlines. Or offer a full price, then discount for seniors?