Avios changes 9: what will happen to partner airline earning rates?

Executive summary:  BA has not yet released its new partner earning rates but we know that changes – for the worst – are coming to certain airlines

Key link: ‘Club Changes’ page on ba.com, ‘Club Changes’ page on iberia.com

(If you are new to Head for Points, welcome!  Please consider bookmarking the site or sign up for our daily emails via the box in the right hand margin.)

Here are the other articles in this series you may have missed:

1. Understanding the new tier point rules

2. Understanding the new earning rates

3. Understanding the new spending rates

4. What is an Avios point worth after April 28th?

5. Exploiting the ‘no repricing on date changes’ rule

6. Why are off-peak upgrades now more expensive than peak?

7. Save 43% of your Avios on long-haul redemptions if you fly Iberia

8. Partner redemptions may be cheaper if booked on iberia.com

10. Are you a winner or a loser overall?

As I outlined in the first article of this series, the Avios changes – to come into force on April 28th – will sharply reduce the amount of Avios points earned when flying on a discounted economy tickets.  They will increase the number earned on fully flexible tickets in all other classes.

British Airways has made no announcements so far about changes to the earnings rates on the other 14 oneworld alliance earning partners.

However, Iberia has let the cat out of the bag.

airberlin und oneworld auf der Baustelle des Flughafens Berlin B

Here is the list of the British Airways airline partners.  If you click through each of the logos on that page, you will see the current earning rates.

The following airlines already offer variations on a theme of earning 25% of miles flown in Economy, 100% of miles flown in fully flexible Economy, 110% of miles flown in Premium Economy, 125% of miles flown in Business and 150% of miles flown in First:

airberlin, Cathay Pacific, Finnair, Japan Airlines, LAN, Malaysia, Qantas, Qatar, Royal Jordanian, S7, Sri Lankan, TAM, Aer Lingus, Meridiana

The following airlines are substantially more generous and you receive the current British Airways rates.  This means 100% of miles flown for ANY Economy ticket, 150% for Business and 200% for First:

American Airlines, Iberia, US Airways, Alaska

Can you guess what is going to happen?  Well, you don’t need to.  If you look at the Iberia website for the forthcoming changes, it says:

Are there any changes in how Avios are collected with the other Programme Partner airlines?

In the case of British Airways flights, the levels for collecting Avios will be updated so you can also obtain Avios in proportion to the purchased fare. These levels will also be updated for flights with American Airlines, US Airways and Finnair.

We can therefore expect to see the Avios and tier points earned when you fly American, US Airways and Iberia to change.   Because of the transatlantic joint venture, they are more likely to match the British Airways rates than the rates for other oneworld partners – although this makes no difference if you are in economy.

There is one quirk, though.  What will American Airlines do with its own earning rates?  After all, at present, if you credit British Airways super-cheap economy flights to an American Airlines account it will credit at 100%.  These miles also count towards AA status.  (This doesn’t work with Finnair who already only give 25% credit for cheap BA economy flights.)  Perhaps we should all start crediting economy BA flights to AAdvantage?

It would be a little odd if Alaska remained the only airline to earn 100% with British Airways Executive Club in discounted economy, but it might happen!

Click for the next article: a summary of the winners and losers from the changes

The disappearing Tesco / Avios competition, and watch out for the Clubcard Flash Sale
How to top up your East Coast Rewards before closure (and help save East Coast Rewards!)
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Comments

  1. Hmmm… another good new coming soon then….
    Well, it makes sense most flight will earn only 25% but I’m totally unsure about transatlantic flights because it would basically mean the end of the marketing partneship between AA, BA and IB.
    For instance, an AA flight would earn 100% of miles on American Advantage and a BA flight only 25% for the same routes which would give a huge huge incentive to book an AA flight over a BA flight. I remember that only transatlantic flights were earning 100% miles at the very beginning of the partnership ; it could be the same again with new changes.
    Besides, we see some very strange earnings, a Vueling flight (booked on Iberia or an Optima fare on Vueling) still earns 100% miles on IB+ with the new table whereas flights taken at basic rate on Iberia only earn 25%.

    • neuromancer says:

      I suppose they have forgotten to include Vueling in the explanations, but it’s hard to believe it will stay at 100%.

      • It has been published already so I guess they had a hard talk about this already.
        Optima fares can be credited to Iberia+ or to Vueling Puntos which is a Revenue based loyalty program. Basic fares don’t get anything on IB+ (whereas they can be credited to Punots) but the possibility to credit to IB+ has been a marketing argument to upgrade to Optima fares (which include a checked luggage plus a little bit of flexibility) so they needed to credit more than 25% to keep that argument decent.

    • AA will be restructuring its own programme once the US Airways programme is merged in and I would expect to see that harmonised at 25%. There may be a six month window, I admit.

      • If it’s a full harmonisation, i.e., AAdvantage earns 25% on economy discounted on AA and BA, then imagine the level of furore. Americans are a very flying nation and a devaluation coupled with 25% earning rate (vs. 100%) will be truly damaging to their business.

        Might be no economics left behind spending money on higher fares that earn 100% of devalued points, i.e., cost of business class acquired via FFP will be similar to buying it for cash outright.

        However, AA earning 100% on AA economy discounted flights, while 25% on BA economy discounted… possible but that throws BAEC into being a third-world program. Would definitely drop their revenue from the US (in absence of the joint venture).

        Let’s see how the partners (AA and BA) get out of this one. The amount of revenue and arbitrage in question is far higher than between BA and IB.

        About labelling, they call classes G, Q, S, N, O “Deep Discounted Economy” — these are classes on which an overwhelming majority travels… which world are they living in? Clearly the world of 1bn pre-tax profits and no limits to fares.

        Again, with BA having dominant position on Heathrow slots and BA-AA-IB-Partners cartel sharing the revenue from transatlantic routes, where are the competition regulators?

        • Yes, it would drop their revenue in the absence of a joint venture. Not that I see how that’s remotely relevant given the fact that they are in one?

          The number of people flying on cheap tickets is irrelevant. Those classes are available at a deep discount to full priced economy. It’s been standard practise on many airlines that deep discount economy only earnt 25% or so. Is it not a good thing that they’re living in a world of 1bn pre-tax profits and no limits to fares – given that is the actual world we’re all living in now?

          The competition regulators approved the joint venture. While they have the dominant position, they don’t have a monopoly position. Numerous airlines fly from Heathrow to the States – many more flying indirectly. The competition regulators are there to prevent monopolies – not help customers get as many air miles as they can!

          • Personal comment but you are turning arguments upside down just to argue.

            “What if” scenarios certainly matter and the joint venture AA, BA, IB will crumble (or would require different revenue sharing) if customers will flow towards AA for 100% frequent flyer miles on economy flights and a better product for business class.

            The point that if AA will not bring the earning rate down to 25% on economy (in line with BA) then there will be structural problem undermining the joint venture.

            Now, AA is unlikely to do that (25%) and I am ready to take a bet on it.

            That would also be evidence to the strength of dominant position and wiliness to use it. BA shows that it can operate very profitably without giving similar rewards and benefits as it’s partner airline AA.

          • AA flights earned by BAEC members are obviously going to drop in line with BA flights.
            But I don’t think we will see any major change to the AAdvantage earning table—whether earned on BA or AA. 25% is almost unthinkable for the Americans.

            It’s no threat to the JV, you can pick whichever FFP you like, you can pick which flight prefix you want and you can pick which operating carrier you like, completely separately.

  2. Apologies if this has been discussed before, and for being slightly off topic, but one wonders if the recent acquisition of a 9.99% share in IAG by Qatar will see them shift from Q Miles to Avios as their reward currency?

    • Personally I doubt it. I think this is simply them buying as an investment. They may also be doing it to try to gain some influence in IAGs future directions. IAG Cargo already buys a significant amount of space on QR widebody freighters (including the occasional full charter) so they could be looking to safeguard/protect future agreements and alliances.

    • Very unlikely. You don’t get much influence with 9.99%. More interesting is that Qatar also has a 20% stake in Heathrow, so there will be some interesting discussions over landing fees, slots etc.

  3. Hi Raffles
    I was looking at Aadvantage redemptions yesterday in light of the recent BA devaluation. Some of the deals remain amazing value:
    South Africa for 75000 miles return in J versus ~137500 on BA (averaging out the peak v off peak rates!)
    Maldives for 60000
    Hawaii for 100000
    Do you plan to cover these opportunities in more detail as I think you have commented before that a devaluation or realignment in this regard could very likely?
    Cheers.

    • The problem with AA is that it is ripe for devaluation and I am wary of getting readers to pile in. If the AA credit card bonus jumps up, or AA stays at 100 per cent on cheap Y, I will cover it.

      AA also has massively complex routing rules, such as you are not allowed a stopover or even plane change in the Middle East if you start in Europe, which makes it hard to know what is actually allowed. That Maldives price, for eg, would not be valid on Qatar or Etihad because it would involve a plane change in the Middle East.

      • Yep this and the removal of free stopovers at gateways does make it less attractive. Though there are still some gems in there especially if you can make use of the zonal pricing.

        So would you say book now (and maybe change later)? How imminent do you consider a devaluation to be? What I’m worried about is that AA I think have absolutely no notice last time they changed the scheme…

      • Not sure if this is a new rule, but that was not my experience. I redeemed exactly that award last year: MLE-AUH-DOH-LHR. 40k Aadvantage miles in first, one way – mix of Etihad and Qatar

      • The Maldives are part of the middle east/India zone though. With limited exceptions, you cannot transit a different zone.
        LHR-DOH-MLE for example is a perfectly legitimate routing as it is a Europe to Middle East/India award.

        You cannot however route from Europe via the Middle East to Australia/Pacific on one award, so LHR-DOH-MEL is not valid.

  4. nathanjf says:

    Could this also spell the end of the 210TP in AA first?

  5. Does anyone knows a link to AAdvantage mileage calculator for earning?

    Need to check if crediting all flights to AA (rather than BA) is a reasonable solution (while retaining status).

      • Don’t forget the AA Challenge too! :)

        (for a cost admittedly, but worthwhile for those jumping ship soon and desperate to get status as quickly as possible)

        • Worth noting this incidently – was an email I received recently and basically says you’ll get bonus points this year if you fly on AA / US metal (read the smallprint)

          http://www.aa.com/i18n/AAdvantage/aadvantage-currency.jsp?locale=en_GB

          Not sure if either the bonus miles or challenge are worth mentioning in an article sometime Raffles, however I’m aware you’ve admitted before that AA isn’t your niche and that you wouldn’t want to promote AA at the risk of a future devaluation (but could be worthwhile highlighting) :)

          • So AA does reward full-fare First/Business Class tickets in 2015 with increased Class of Service bonus (went up from 25 to 50% for Business) and Long Flight bonus.

            All of that kicked in 1 January 2015 without a need for devaluation.

            Effectively BA ‘said’ that they can’t reward full-fare First/Business without a devaluation but they see more fairness in giving those fares up to 300% bonus.

            Yes, AAdvantage is ripe for devaluation but could it be worse that 50% increase in air miles price?

  6. They have no mileage calculator, i.e., how many AAdvantage miles to be earned on LHR-JFK.

  7. OT: Anybody know if there is a problem booking awards at BA site? Loads of AY availabilty to bkk has vanished overnight. Also, flights pricing up wrong, e.g. HEL-HKG-BKK J is 120k one way instead of 75k. Similar issues via TYO or to HKT.

  8. OT: Who can give me some advice please. I am trying to work out the most cost effective way to get from London to Los Angeles area. I have a bunch of Avios and Virgin Miles. Circa 30000 in each scheme but can top up with similar amount of MR points and have a few hundred in Tesco vouchers. Looking to book 2 adults and 1 young child. Leaving in March, returning in April. Found Virgin availability for about 900 return + 127500 miles or from about 1600 in cash, which would also earn about 22000 miles. Not really worth the miles \ converting Tesco vouchers. BA looks similar (a bit more miles and money) n the dates I am looking. Have not checked Iberia when logged in but they appear to fly to SFO only not LAX.

    • Also OT: Anyone still seeing 3v cards at Tesco? Or the new PAY cards from the same company, which are the new version of them. Cannot find £ 50 Visa cards either anymore but £ 50 Amex gift cards instead. Checked online too but not available at present.

      • They are meant to be coming back in store. Allegedly a ‘dodgy batch’ forced the withdrawal pre Christmas.

      • Michael,, be careful with the new amex ones, they don’t come under the 150 cc bonus! I had to beg for them when I noticed they didn’t show on my receipt..I thought they would be the same as the visa £50 ones. Good we might see 3V back soon, desperately awaiting them right now!.

  9. have run into trouble with BA earning avios on EI. I flew DUB ORD/BOS DUB on a Business Class ticket – outbound in P Class and inbound in I class. BA told me no earnings on these booking classes – referred me to ba.com where they say that EI earnings classes are J, D, C. I suspect this is wrong as EI recently changed their booking classes. any thoughts what I can do?