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Downgraded: Short flights on United
Watching United and US Airways devalue their frequent flyer programs is like watching a tennis match, with the two players volleying back and forth. Every time one airline does something, the other does it a few weeks later. Lather, rinse, repeat. The latest: After US Airways did it a few weeks ago, United Airlines is eliminating the 500-mile minimum mileage earned. In an e-mail to customers, UA wrote:

Beginning July 1, 2008, for flights of less than 500 miles, passengers will earn redeemable miles equal to the actual miles flown. Elite Qualifying Miles (EQM) will also be awarded based on actual miles. Elite Qualifying Segments (EQS) are not affected. This new mileage accrual structure will apply to travel on or after July 1, 2008, regardless of when the travel was ticketed.

This affects road warriors who park their butts in seats on short flights most. It sure slows the trip on the road to elite status, or to that free ticket.

Update: The rules are now online, here. Thanks, Benet and Antonio!

Upgraded: Hassle
The agents of the Customs and Border Protection Service have 60 different reasons to deny a person entry into the United States, “at the discretion of border agents,” even if visitors have a valid ticket and don’t require a visa. “Looking at me funny” might be one of them, as an Italian visitor found out, ending up in the slammer for 10 days without charges. At what point is the appeal of travel to the United States — especially in light of the low dollar — outweighed by the government-paranoia BS factor?

Downgraded: Airspeed
Upgraded: Fuel efficiency
Think flights are moving a little slower lately? You may be right. Airlines are slowing down the engines and saving fuel in the process. Example: “Cutting the speed on a Northwest Minneapolis to Paris flight from 542 mph to 532 mph adds 8 minutes in flying time but reduces fuel consumption by 162 gallons, saving the airline around $535.”

Mergers, acquisitions, airlines shutting down, and miles… People are clearly (and understandably) nervous. A question in the comments on the last thread:

How do mileage programs work during mergers and stuff. I’m pretty deep in the United Airlines Mileage Plus program, but if United/Continental goes through, what happens to those of us that are in the program? Please share if you know…

Well, there are no guarantees in life, but historically, merged airlines have combined miles into one program, with no immediate loss. Note the word: immediate.

If you exclude Southwest and JetBlue (which offer points or credits rather than miles) most airlines’ frequent flyer programs have a similar currency with a similar redemption schedule. Not the same. Similar. Granted, there are differences between programs, but, say, American, United, and Delta all give you a base rate of 1 mile for 1 mile flown and charge 25,000 miles for their average capacity-controlled “saver” domestic award.

According to press releases, Northwest miles will be incorporated into the Delta program 1:1. So far so good.

But make no mistake: Down the line, you’ll lose. Mergers will result in diminished flights — older planes won’t be replaced, unprofitable routes will be retired, and the airline executives’ mantra of “overcapacity” will finally be answered with capacity reductions. But all the miles in the frequent flyer programs didn’t decline in capacity. If anything, they increased in number. So a boatload of miles will be chasing fewer and fewer award tickets.

It’s an inflationary scenario. Unless a miracle happens, going forward, the cost of “free” tickets will go up. Fees will increase. And all that means is your miles will be worth less.

Add to that the fact that such inflation is already underway, even without the mergers. Things don’t look good for miles.

To the reader’s question re: United and Continental, I would expect the same as above. I don’t think you have any immediate worries, but long-term worries are sensible concerns.

Bottom line: Start spending your miles. And if you work for it, you can still get decent value. (My yardstick is still an aggressive 1.7 cents/mile or better. Anyone who repeats the conventional wisdom that you should only count on 1 cent per mile — or worse — isn’t trying hard enough. If they were a financial advisor, it would be like proudly earning you 2% a year. Fire that advisor.)

Delta Airlines must have been watching the recent downgrades at US Airways and United and thought, “Gee, those airlines are doing such a great job pissing off their passengers! Why can’t WE frustrate our best customers like that?…”

Sure, they had tried before. They had previously declawed their SkyMiles program by watering down their “anytime” SkyChoice awards — the tickets that cost double the miles but formerly guaranteed a seat on the airline if any empty seats were available. (Versus the capacity-controlled tickets that most travelers seek out.)

At the time of that devaluation, you may remember this sidebar in my post:

As an added bonus, there’s this nugget of a policy change on the site, too: “Some airline partners impose a surcharge on Award Travel redemptions for travel on their airline. These charges will be collected at the time of booking.”

Bad enough — and yes, those fees exist, and they vary — but it’s even worse: It’s not just itineraries booked solely on partner airlines that get slapped with an obnoxious fee. If you use miles to book an itinerary that combines Delta and any partner airline, there’s a $25 surcharge. Just because you’re using one of their business partners. (Hat tip to Chris Elliott.)

What’s the point of alliances — and heck, frequent flyer mile programs — if you need to keep paying real cash on top of the miles? Delta’s miles just lost more value. Again.

And as Gary Leff pointed out a few weeks ago, actually making that reservation is worse now, too. In a gratuitous move, you can no longer put itineraries on hold over the phone. And remember, you can’t book every itinerary online using miles. Other airlines still offer a 48- or 72-hour hold, which is useful for making reservations for hotels, etc. No longer: Now you ticket immediately, or lose the itinerary.

Someone explain how we can call this a “loyalty program” any longer? And where is the SaveSkyMiles.com crowd, so vocal back in 2003, on any of this?

The sun is setting on Delta SkyMiles.

Related:
- Another stab in the back of frequent flyers
- Flight Mitosis: Delta splits your nonstops into two

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The merger insider
Holly Hegeman’s red phone rang, and a trusted insider gave her this update on the United-Continental merger rumors. It’s on.

…the bulk of the existing United Airlines brand will continue to be used internationally, but Continental will take over the domestic operation for the most part. Other details we were told included the fact that there has already been a transition team put together. The deal will be announced after Delta/Northwest goes public. There will initially be a holding company set up to run both airlines. This operation will continue for three-five years. This will allow for a “smoother transition” from the two airlines into one operation.

But what happens if Delta-Northwest doesn’t go through, as it’s now hit a labor-related snag?

The “holding company” concept is one I expected when merger speculation first arose. Much like Air France and KLM operate separately under one company, it looks like the same idea is in the cards for the United-Continental merger, at least to start. But the merger looks like it’s on. Oh well.

Is that “going #3″?
Best opening paragraph in a while:

A newborn baby girl survived an ignoble birth after slipping down the toilet bowl of a moving Indian train onto the tracks when a pregnant woman unexpectedly gave birth while relieving herself on Tuesday.

Bad karma? Or a moral social stand?
Fighting the trend of tipping in American society seems like a losing battle, but the WSJ’s Eric Felten argues against the tip jar at Starbucks. It’s a good read.

Less than 1 cent per mile? No thanks.
I was going to comment that Delta’s new policy that allows you to use SkyMiles to buy a ticket based on the cost of the ticket, rather than the origin and destination, was generally a bad deal, and that it was an other salvo in their devaluation of the mileage currency. But Gary Leff and Tim Winship have already argued this point forcefully, so I’ll let them speak for me. I’ll just nod in agreement.

Misspellings go multinational
My disdain for the name “SimplyWheelz” is not enough to stop the brand from spreading. Hertz’s low-cost car rental subsidiary is expanding beyond Orlando to Alicante and Malaga, Spain, with sales channels targeting British and German tourists.

An old favorite: Fly first class at coach prices
One of this blog’s longstanding favorite subjects, the Y-UP fare, which books into economy but seats you in first class, gets a fresh look from Rick Seaney. The usual caveat applies: Y-UP may be cheaper than walkup regular-economy fares, but they’ll rarely ever beat out a cheapo fare purchased months ago. Nonetheless, it’s always worth a search.

Unscheduled landings stink, but especially internationally
Being diverted to another airport? Never fun. Being stuck on the plane? Never fun. Being diverted, and then stuck on a plane, because you’ve just landed in a different country? Even less fun. Just ask the Qantas passengers who were stuck on the plane during an unscheduled mechanical pit stop in India. (Thanks, Rob!)

Gary Leff slams Peter Greenberg’s frequent-flyer advice, but is Gary’s advice any better for the common traveler?

Gary argues that Peter’s restatement of the conventional wisdom — that cashing in frequent flyer miles is getting harder, if not impossible — is wrong.

And yet I’ve never failed to redeem for the award I’ve wanted, as I’ve mentioned here several times. In the next 10 weeks I have first class award bookings to South Asia, business class award bookings to Europe, and a domestic award as well. All on the dates I needed.

But I’ve accumulated miles in a variety of accounts, if United doesn’t have availability I can check to see what American (or British Airways) has to offer.

Good for Gary, but let’s face it, not everyone has the luxury (or curse?) of multiple accounts with 6-digit mileage balances.

It’s like saying, “Well, my checking account at Citibank was tapped out, so I just paid for my bills, a vacation, and a new house with the interest I earned in my WaMu account.” It’s easy to be glib when you’re a multi-millionaire.

Most people don’t have that luxury. So Gary’s argument, while factually accurate, is not applicable to most travelers. Certainly not most leisure travelers. And, I’d argue, it’s unlikely to work for many business travelers either, whose loyalties (and corporate travel policies) make accumulation in one program more probable.

There IS potentially one way to follow Gary’s advice without getting a sore butt-bone from flying on dozens of different airlines. My weapon of choice: The Starwood Preferred Guest Program and the Starwood Preferred Guest American Express card. You can collect points in the Starwood program, and when the need arises, you can transfer miles to a laundry list of airlines, with no devaluation. (Caveat: Some airlines don’t participate, and some, like United, only accept transfers at a 50% haircut. Stick to the programs that take full-value transfers.)

US Airways reduces the value of frequent flyer programs further with their latest policy change. Here’s the official statement of the changes to the US Airways Dividend Miles program:

Accrual
Tickets purchased on/after March 1, 2008 for travel on US Airways on/after May 1, 2008 will earn the actual number of miles flown and will no longer earn a minimum of 500 miles per segment.
Tickets flown on partner airlines after May 1, 2008 will earn the actual number of miles flown.
Tickets purchased prior to March 1, 2008 will continue to earn the 500 mile minimum for travel after May 1, 2008. Accrual on flight segments greater than 500 miles in length are not impacted by this change.

Redemption
Members redeeming miles for award travel online within 14-days of departure will be assessed a quick ticketing fee of $50 per ticket.
A quick ticketing fee of $75 per award ticket will continue to apply for award tickets purchased from US Airways Reservations. Chairman’s and Platinum Preferred members booking within 14-days (both online and by phone) are exempt from the fee.

The “quick-ticketing fee” is not an innovation. American has been doing it for years, and United followed suit just over a year ago. It’s obnoxious, and purely a cash-grab with no sensible justification, but it’s not a new idea.

What IS a new idea is the elimination of the minimum mileage for short flights. Until now, travelers on short hops were able to console themselves with the knowledge that they’d at least get a few miles for their trouble. This will make earning elite status harder, too. (Which might be a corporate goal.)

What remains to be seen is if when other airlines will follow suit and eliminate the minimum mileage earned.

Another unknown at this point: how US Airways’ partner airlines will credit US Airways flights. For example, US Airways flights can accrue miles in a United Mileage Plus account. As of this morning, this page on United’s website still lists a 500-mile minimum accrual rate for US Airways flights credit to Mileage Plus. I’m just waiting for the other shoe to drop.

Yay. Aren’t these programs fun?

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Upgraded: Frequent flyer legislation
Downgraded: The value of your miles
Frequent flyer programs can be a byzantine maze. Above all, nearly everyone is cranky about being able to cash in their frequent flyer miles. I just tried winnowing down the uncomfortably large kitty of points for some Caribbean travel in May and was given the Heisman. But I’m not cheering on Washington state legislator Chris Hurst, who’s proposing a bill that would allow consumers to cash in their miles at 0.2 cents apiece. “Cash in” literally — for cash. House Bill 2707 is probably not going to go anywhere, but it’s meant as a shot across the bow of airlines whose point redemptions are increasingly stingy. Representative Hurst, call me when you start demanding 2 cents per mile or better. (via Pointswizard)

Upgraded: Delta’s business class seats… on some of its planes
Delta is rolling out new fully-flat seats on its 767s that travel internationally. Excellent news. But only on the 767s for starters, which means that the Delta fleet will have a patchwork of seating at the front of the plane. Sure, every airline rolls new seats out one plane at a time, but it’s odd to limit the rollout explicitly to one aircraft type.

Upgraded: Delta’s flight attendants’ trepidations
With Delta and Northwest in confirmed talks regarding a possible merger, the as-yet non-unionized flight attendants at Delta are looking to organize. Delta’s attendants might be members of the AFA-CWA as of February 14. Consider it a Valentine to Delta management. The goal is to “have a seat at the table” when merger discussions take shape.

Upgraded: Competition for hourly car rentals
With the success of hourly “car-sharing” rentals like Zipcar, the big car rental players are getting in on the action. Reportedly, Enterprise is launching its own version, dubbed “WeCar,” which is being test near Washington University in St. Louis. Just be sure to walk around the car and take photos before and after the rental. If WeCar is anything like their regular operation, those Enterprise guys will try to nail you for any damages on the car, whether it happened on your watch or not.

Upgraded: Gitmo!?
Disturbing and bizarre: There actually exists scheduled service to Guantanamo Bay, ironically provided by the happy-go-lucky sounding Air Sunshine, using 9-seat Cessnas. For those wishing to plan their trip, service is only four days a week, at $250 each way. Not cheap, for such a short trip, and you’d better hope they honor the return portion of the ticket. But you may never want to leave. After all, as Dick Cheney described the conditions for detainees at the base’s prison facilities, when he spoke to CNN in 2005, “They’re living in the tropics. They’re well fed. They’ve got everything they could possibly want.”

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Boaz Shmueli of the excellent MileMaven.com website sends in this tip:

For those Alaska Airlines frequent flyers whose 2007 travels were insufficient to meet the threshold for MVP or MVP Gold, the airline’s elite status tiers, there’s a shortcut that can help you catch up.

If you want to requalify for MVP status, you can fly four paid segments on Alaska or Horizon between January 15 and March 15. Registration is necessary. Click here for full details.

To requalify for MVP Gold, you can fly eight paid segments during the same timeframe. Click here.

These links are “hidden” on the Alaska Airlines website, i.e., you won’t find them on the homepage or the MVP program promotions page. Completing the required flights will extend your status until December 2008.

Related:
- My mom is doing a mileage run
- Alaska Airlines (aff)

Reader David writes:

I was on an American flight this week and noticed that the theme for their annual Road Warrior issue is the James Bond inspired “Miles Are Forever.” I found that particularly amusing given the new 18 month mileage expiration, which doesn’t exactly seem like forever to me…

Ha, indeed! I guess “Miles are 18 Months” didn’t have the same cachet.

Every year, American Airlines runs a contest to name their “ultimate road warrior.” I have to admit, the 007-theme of this year’s contest is fun, and the styling is good, but the irony that the miles aren’t actually “forever” is dynamite.

Look on the bright side: You might not be able to keep the miles you earned forever, but they’ll never be able to take away the hours and hours you spent on the plane. Those, indeed, are yours forever.

(…And to ward off nitpicking: Yes, I know that you can extend the life of your miles another 18 months by flying more or redeeming miles, so the award winners won’t risk losing their miles anytime soon. But still.)

With the end of the year nearly upon us, many of us are looking to make charitable contributions. Don’t forget to consider donating miles.

Many of us have small balances in some frequent flyer accounts. Miles that aren’t going anywhere — or taking us anywhere — fast. Instead of letting them expire worthless, donate some of those miles to a charity.

Sure, you could exchange them (at a loss) via Points.com. Or you might cash them in for a magazine subscription.

But as reader Jennifer at Daily Mitzvah reminded me, most U.S. airlines offer a charitable donation feature. Here’s a list.

• American
• Continental
• Delta
• Midwest
• Northwest
• United
• US Airways

If you can’t use your miles, let someone else benefit. Any airlines missing? Add them in comments!

Several readers have written in, asking about Points.com’s newly-launched “Global Points Exchange,” which bills itself as a person-to-person frequent-flyer mile marketplace, letting you “trade the miles and points you have, for the miles and points you want.”

Questions are on the skeptical side — “Is this legitimate?” “Is this a ripoff?” “Is GPX legal?” — so let’s look under the hood.

For starters, yes, this is a legal service, despite the airlines’ rules against selling or bartering frequent flyer miles. Points.com has struck deals with each of the participating airlines, so this is an authorized setting for point exchange, not a back-alley deal or an eBay auction.

The principle is a good one: You’ve got miles in one airline’s account, and you want miles in another. So why not trade with someone who has what you want, and who wants what you’ve got to trade?

I’ll tell you why not: Fees!

GPX is plagued with outrageously high transaction costs, costing you as much to exchange your miles as you’d pay to buy those miles outright from the airline.

Is this any surprise? After all, it’s coming from Points.com, which has long converted miles between programs — with hefty devaluations along the way. And according to their latest financial guidance, people are falling for it. The company “transacted more than 10 billion miles and points” in 2007 alone.

The GPX program is currently in beta, and there aren’t a lot of offers on the bid or the ask. Only five airlines currently participate: Air Canada, Alaska, American, Frontier, and… (wait for it) Icelandair!

Fees vary tremendously depending on the airline, but none of them are small. The outgoing account determines the fee you pay. So exchanging 15,000 American AAdvantage miles into another airline currency will cost you $180.00, while exchanging 15,000 Air Canada Aeroplan miles will cost $300.00. PLUS the $6.95 processing fee (currently waived.) Extortionary.

No thanks, Points.com. Your GPX is DOA.

Related:
- The value of frequent flyer miles
- Reader mail: Can I transfer points from one airline to another?
- Travelocity soon to let you book travel using points and miles

In just a few days, my mother will get on a plane (with my dad dutifully accompanying her) and fly to Florida. It’s not a vacation they really planned to take. They’re doing it for the miles.

For those who don’t know, a mileage run is the process of taking a trip just to get the miles. (Usually this means elite-qualifying miles, and not redeemable miles.) For the mileage-running purist, your destination is irrelevant. You might not even stay there — you just fly there, and fly back, to collect the miles. (Wired Magazine’s Dave Demerjian recently jetted around the US just for the miles and lived to tell about it. Even crazier, The Global Traveller recently went on a one-month-long mega-mileage run to establish lifetime elite status.)

Is her son to blame? Perhaps… Indeed, like the dealer helping a junkie get one more high, I pointed my parents to FareCompare’s search engine for mileage runners. The tool searches for flights on a cost-per-mile basis. It turned out that Florida was both inexpensive and desirable.

Yes, my mom has gotten hooked on elite frequent flyer status. She was a few hundred miles short of making status again for next year, and while she wasn’t enjoying the mega-uber-perks of top-tier status, she still appreciated the shorter check-in with business class at crowded airports, the dedicated security lines, and the bonus miles.

Maybe we should call their trip a comfort run. They’re leaving the airport, after all. And they’re actually staying at the destination for a few days. They also used some Starwood points for a Westin and lowballed an Avis rent-a-car via Priceline. In this instance, I think my parents were looking for an excuse for another vacation. And the elite status that results is collateral damage. So this trip isn’t just for the miles…

So is a mileage run really worth it? Elite status is still worthwhile, if you travel enough with one airline (or within one alliance) and if you’re going to take advantage of the perks. If the price is right, and it gets you the perks you want, that mileage run may be an investment worth making.

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