Bits: BA trialling improved ‘cash for Avios’ with EU261?, Etihad launches A380 from Paris

News in brief:

BA trialling improved ‘cash for Avios’ EU261 deals?

A few months I wrote a fairly scathing article about British Airways offering people Avios instead of cash when they claimed EU261 compensation.

I don’t have a problem with the concept, far from it.  The problem was that BA was offering such a pitifully low number of Avios – you were effectively paying 1.33p per point – that it seemed like it was playing on the potential ignorance of the claimant.

Things may be changing.  A reader just sent me details of an “enhanced compensation package” he had been offered for a short-haul EU261 claim.

He can take €250 (£216) in cash or 20,000 Avios points.

At this level I would be on the fence.  My spreadsheet of my last 5 million Avios points redeemed shows I got 1.22p of value based on what I would realistically have paid for the same flights.  Most people do better than this because I have so many points I tend to use them irrespective of the value I get.

This ‘enhanced compensation offer’ means our reader is paying 1.08p per Avios point.   It’s not a no-brainer but, for a lot of people, it will make sense.

This is also likely to prove a sensible move for BA.  It is better to offer a generous Avios package which a lot of people are likely to accept rather than a greedy package which any sensible person would refuse.

Etihad A380

Etihad launches A380 from Paris

You’ll have to wait a couple of weeks from my review of my 2nd trip in the Etihad A380 First Apartment.  If you decide to give it a try – American Airlines miles or Etihad Guest miles are the easiest ways – there is now a new route.

After what was presumably an unsuccessful run on the Abu Dhabi to Mumbai route, Etihad is switching the aircraft onto one of its two daily Abu Dhabi – Paris services instead.  It will allow it to compete better with Qatar Airways which also runs an A380 on the Paris route – you can read my review of Qatar’s A380 First Class here.

Qatar’s A380 First Class redemptions are far easier to get via Paris than via Heathrow.  Reward availability on this new Etihad route will hopefully also be as good.  The Paris service is only currently scheduled for May to October.

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Comments

  1. “Qatar’s A380 First Class redemptions are far easier to get via Paris than via Heathrow.”
    Qatar doesn’t allow any F redemptions at all on the LHR route.

  2. I think BA compensation would need to comfortably be under 1p/avios before I would consider it being generous. What sort of cash to flight voucher ratio have been offered in the past? e.g. If the option has been £200 cash or £300 flight voucher then 25k Avios might not be unreasonable since it can also be used for things other than flights.

    • RussellH says:

      Yes, in the distant past (1990s) I was offered $200 cash or $300 voucher for voluntary bumping to a later flight at SFO.

      They then miswrote the voucher so that it was encashable for $300 – and then they misread it at EDI and gave me £300 in used £20s.

  3. StuartJ says:

    I was also offered the enhanced 20,000 Avois each option when my family of 4 was delayed recently (over half term) returning from ALC. Still took the cash, especially as the rate was 1.14 when BA eventually confirmed the values.

  4. I was offered 50k Avios per pax instead of €600 (~£522) for our EU261 claim for the 14+ hours delay home.

    So approx the same rate as Rob mentioned.

    Don’t know if/when I’ll be making a redemption on BA in the next year or so, so stuck with the flexibility of cash.

    • RussellH says:

      If you are applying from within the UK (if it lasts) do you have the option of getting real Euro, or do you have tp accept Sterling?

  5. It sounds like a move in the right direction but just not far enough! With some of the recent BA ‘service enhancements ‘ I have been using Cityjet more often. Recently I experienced my first significant delay with them. After filing a claim I was given the option of the 250 Euro cash or 350 euro in travel vouchers. It was a very simple process to file the claim. Despite the pain of the delay I would commend Cityjet for their excellent customer service. (Plus they still give you little drink onboard )

  6. OT:

    Can I, as an Amex platinum holder, issue a supplementary gold card to a person who lives outside the UK

    And what impact, if any, would this have on their medical and travel insurance coverage

    • I doubt it unless they still have a UK credit file as Amex does ID checks.

      Insurance would be invalid as you would breach the cap on annual days out of UK.

    • This can be done, no problem. You just need the usual document check, including getting someone from a reputable profession to sign the copies.

      Not sure about the insurance, If I remember correcty it doesn’t mention UK, but country of residence in the T&C.

      • *not sure about the medical insurance. Travel insurance appears to apply, my supplementary card holder has successfully claimed last year and they aren’t UK a resident.

  7. Is there any reliable information out as to how many AVIOS expire each year as a percentage of AVIOS issued? I am surprised more airlines do not offer their FF miles instead of cash for EU261 claims. Money paid out is for sure cash lost now; FF miles may be used one day or may just disappear from the balance sheet. I imagine many occasional travellers never use the FF miles they get on their annual holiday, that is if they even bother to join the airline’s FF club in the first place.

    • Very few I imagine because BA is VERY generous with the expiry rules – eg ANY activity keeps them alive.

      Compare this to:

      KLM / Air France – you MUST credit a cash flight every 24 months or your miles die
      Lufthansa – your miles die three years after you earn them irrespective of how much activity you have, unless you have the LH credit card and use it every month
      Etihad – your miles die 2-3 years (would need to check) after you earn them irrespective of how much activity you have

      • TGLoyalty says:

        Emirates die 3 years after you earn them too.

      • the real harry1 says:

        I’d say more like 10% a year, people are generally useless in these matters – cf gas & electricity – would be good to find out

        • But who has NO activity on an Avios account? Earning or spending? Yes, you might have a couple of thousand earned by accident a couple of years ago, but that is more likely to apply to a non-UK resident who did a one-off BA flight.

          The larger your balance the less chance you will ever have any expire.

  8. TripleB says:

    I got this in response to my latest claim at 7am this morning (19/3).

    The distance of your disrupted journey was between 1,500km and 3,500km and this has been calculated in accordance with EU legislation. This means you’re each entitled to €400.00 in compensation.

    We would like to offer you 32,500 Avios points as an enhanced compensation payment. Subject to availability, you can put your Avios points towards future bookings or use them to upgrade your class of travel next time you fly with us. They can also be used for hotels and car hire. Please visit http://www.ba.com/executiveclub to find out more.

    • TGLoyalty says:

      I’m not sure what their game is here it isn’t really a mouthwatering amount of Avios so I’d take the flexibility of cash

      Since their BOB has set the rate at 0.8p per point I think they need to be about 10k higher to get people seriously thinking of taking the avios every time

      • TripleB says:

        32500 does not fall within my definition of enhancement – so I will be taking the cash. Hopefully my bank doesn’t screw me too much on a EUR deposit into my current account (or BA don’t apply a horrible exchange rate when depositing a GBP amount).

        I have basic current accounts with Lloyds, Nationwide and Metro Bank. I suspect of the 3 Metro Bank is probably the least likely to screw me (their account and credit card has saved me many hundreds of pounds in fees and FX conversion outrages when travelling in the eurozone).

        • Metro Bank are excellent on that front – I saved a large amount paying a USD cheque in to them! BA will convert and pay you in GBP automatically though (assuming you’re claiming from the UK).

        • Assuming you live in the UK – the cheque will be in GBP from BA. (They set the FX rate monthly I believe and convert accordingly). I got the equivalent of EUR600 last month, and got a GBP cheque in the post.

      • Aren’t outstanding Avios tallied differently on their balance sheet as opposed to “spent” cash ?
        Anyone, What is the conversion rate BA(or IAG) claims on its balance sheet for 1 Avios ?
        IF that is a better rate than what they are offering us, then can we give a counter-offer at that rate ?

  9. I have been reading this article
    http://www.headforpoints.com/2015/08/19/how-to-upgrade-british-airways-flights-with-avios/

    I have a booking via Trailfinders on BA Y (WT – N class) and trying to upgrade via the link on above article on MMB at BA website but I get following error.

    Sorry, it is not possible to change this booking on ba.com. Please contact your booking/travel agent.

    Does that mean there is no way to upgrade this booking to WT+?

    • You need to ring BA. I get the same when I try to upgrade my wife’s work flights which are booked via a corporate TA.

      • Just tried that.
        Indian call center repeated the same saying it was special fare booked via travel agent so they cannot make any amendments.

        Well it wasn’t special fare but it was some £40 (lets say £10pp) more expensive than BA itself was selling directly. Even the same price till today. Only used trailfinders due to Amex offer, hoping that I will be able to do this upgrade.

  10. Interesting article in the Sunday Times today. Read whilst on the way to Oslo on BA. I’m sure they liked my Virgin CC too when paying for food :)

    https://1drv.ms/i/s!AhHGLh_r-3e0heMDzI-P13JMGrg31g

    • One customer had to pay for wine on his J flight? I know their going downhill but that is just BS.

      • Not sure why I am jumping to BA’s defence, but maybe the buying wine was a reference to the winter period of the introduction of BoB for connecting flights to a J/F flight..?

        mind you, that’s still totally ridiculous IMHO.

      • Not if they flew from outwith London and had a connecting flight.

        I thought the surveillance of kids by schools article next to it looked a more scary prospect though!

  11. What do BA actually pay for the Avios? What I’m getting at is what do they save on the pound by offering Avios rather than cash?

    • the real harry1 says:

      BA is the Bank of England, it can magic up Avios currency out of thin air. The thing to understand is that Avios points are a promise to pay – and the cost is effectively future revenue (real money) foregone from other sources. Can BA make itself infinitely rich at little cost, by magicking up infinite numbers of Avios points? Of course not, because the currency relies on credibility & keeping the promise to pay. Everybody believes in the value of Avios, albeit we individually might ascribe different values to each point. It is a social contract between provider (currency central bank/ ‘government’ or owners/ BA) and user. Offering Avios points instead of money saves BA real money and has a positive impact on cashflow.

      • That’s really interesting. I thought they might have gone down an internal market route. In which case, relevant to this article, I think they should be offering at least the equivalent to 1p.

        • Now I’m no expert on this and I’ve not read anything so this is best guess.

          Avios is a separate business but 100% owned by IAG (correct me if I’m wrong).

          So in BA’s books when they give someone 5k avios for service recovery they would:

          Dr expense (value of avios determined by some transfer pricing between Avios and BA)
          Cr cash (they might actually pay some cash to Avios)

          Avios would then:
          Dr cash (equal and opposite as above)
          Cr liability.

          As it’s all part of the same group, it all gets consolidated up such that the aggregate journal is:
          Dr expense
          Cr liability

          As harry mentions, no cash actually leaves the IAG Group as it effectively the central bank.
          Anyone care to add anything? As I mentioned, this is pure guess work.

          • BA pays real cash to AGL, and vice versa for redemptions. It is run as a genuinely stand alone business – remember Avios is in Crawley, whilst all other IAG staff are in Waterside outside Heathrow.

          • the real harry1(11:15 am) , is correct in stating that BA can “magic up” Avios.

            However, there is no “promise to pay” :

            21.1. Avios points, and all rights of title to and property in such Avios points issued at any time, remains with AGL at all times and never passes to the Member.

            21.2. Risk (for example, theft or unauthorised or fraudulent redemption) associated with Avios points passes to the Member as soon as Avios points is recorded on the Member’s account, or otherwise awarded to the Member. Neither AGL nor British Airways is liable for unauthorised or fraudulent redemptions arising due to the actions of the Member or the failure by the Member to adhere to these Terms and Conditions.

            Those who collect Avios are reliant on the “social contract” – as he rightly points out.

            As said in the past -it’s all best treated as a hobby. :) .

          • the real harry1 says:

            that’s when I failed in banking – honest – I was recruited at a high level – why the hell did they ask an Arts person to go into banking?

            that stuff threw me, as you might expect – still did pretty well

  12. After AA cancelled and rerouted via London my business class seat from Dublin to Chicago AA offered $1,500 iin vouchers or €600 cash. I thought this was a win win deal and made silver the next year using the vouchers . The equivalent of 50,000 avios for me does not appear overly attractive given the high fees if using Avios on many one world airlines. I can’t see making silver on that many avios.

  13. johnny_c-l says:

    OT: Just had an email from Amex offering 20k bonus MR points when applying to upgrade from Gold in the next 4 weeks and spending £1k.

    Link appears to be personalised but will check properly later.

    A good offer but have been working towards the £15k/10k MR Gold so don’t want to lose that and would not keep a Plat open after the bonus as the benefits don’t work for me.

    • Hmmm….
      I am thinking of applying for this upgrade.
      I will wait and see if I get any personalised upgrade offer.

  14. Just out of interest, how does one accrue 5 million Avios? I use everything I can to raise points but rarely get over 250,000 a year?

  15. Trying to check in for flight JNB to LHR tomorrow. Booked on 241. Let me check in but won’t let me save boarding pass says I haven’t entered valid passport info for flight. I have, should I be worried about being downgraded? Will my chosen seats be saved?

    • I had the same issue as you on my rtn leg, thankfully still flew in my booked class of CW.

      As you are checked in you should hopefully be ok.

      When I was downgraded on the outward leg I couldn’t even do OLCI….

  16. I mentioned this on the previous article on the subject but as a data point in April 2014 BA offered me 100,000 avios compensation as part of a claim for EU261 compensation. Back then €1200 was around £980 so at >1p per point and given I had plans for a redemption I accepted this.
    Odd that they are now offering less than that.
    Note that this an agreed settlement ahead of a small claims case I had lodged rather than an official EU261 payment .

  17. Surfnode says:

    OT: I have a 2-4-1 voucher expiring at end of August. For various reasons a planned redemption (or rather the time off for that) may be pushed later than that.

    As im travelling from edi, is there any ‘mileage’ in starting the positioning flight to London earlier (mid August say, like some people do with Dub-Lon legs) and then be able to start the long haul leg a few days/weeks later?

    I didn’t manage to redeem last year as one of those quatar deals made more sense (and pushed me into gold territory ;).

  18. OT. Just checking if BAGold cabin bonus is 100%, the same as the tier bonus?

    Thanks!

    • BA status is irrelevant for the cabin bonus, it depends on which cabin you fly in! Status bonus is indeed 100%.

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