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United MileagePlus Rolling Out More Devaluations, Intra-Europe And Asia Business Class Prices Skyrocket – View from the Wing



United MileagePlus Rolling Out More Devaluations, Intra-Europe And Asia Business Class Prices Skyrocket

It began last week watching the prices for Lufthansa and ANA first class awards skyrocket but apparently United wasn’t done devaluing its MileagePlus miles.

Days ago business class intra-Europe over 800 miles was 27,500 miles. Now it’s 45,000 to 49,500. Short-haul business class is now 33,000 miles.

The devaluation stretches to intra-Asia redemptions as well. Naturally United hasn’t said a word to members letting them know their miles are now worth less.

United Airlines last devalued its miles 11 months ago, so maybe they figured that they were due? When the MileagePlus program eliminated award charts they eliminated any up-front promise of value. Every time an airline has done this, they’ve increased the prices they charge for awards. Every. Time. They can do it in stealthier fashion. They don’t need to tell members they’ve done it. The temptation is just too great.

The airline doesn’t make a lot of saver award space available on their own flights, but they’re part of Star Alliance which means they have more quality partners than competitors like American and Delta. The ability to redeem miles all over the world across myriad partners has meant more ways to get where you want to go at reasonable mileage costs, even though they kept drip dripping partner award price increases during the pandemic.

Several key takeaways: we already knew not to trust United or MileagePlus. They were among the worst during the pandemic (refusing refunds for cancelled flights, increasing mileage costs when no one was looking). These increases without notice make their miles worth less.

  • Spending on United’s credit cards is now worth less.
  • Transfers from Chase (and Bilt) to United are worth less. That marginally reduces the value of those transferable currencies.
  • And it’s probably counterproductive for United in any case, since around 2018 the revenue growth MileagePlus was seeing was accounted for in transfers from Chase. They got Chase to pay more for their miles in a deal extension in 2020. But they’re not playing a game that’ll get customers to drive increased revenue by spending more.

In some ways it’s hard to care too much about what United does to award pricing since they weren’t globally competitive to begin with. If you’re earning United miles from flying you want those to be as valuable as possible (and United has been better to fly lately) but if you’re collecting miles for any other reason it’s best to choose another program.

When United has raised the price of awards in the past they’ve taken a hit on credit card charge volume, and that’s bad for their bottom line. Perhaps they are hoping this time will be different. They’ve gotten away with it recently, surpassing charge volume on American Airlines co-brands (as that airline implied on its recent Investor Day). Perhaps they figure that customers won’t notice.

(HT: Dave Y)

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