Etihad Guest announces a HUGE devaluation from July 8th

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Etihad Guest surprised me yesterday by announcing a devaluation, due to kick in from July 8th.

Given their aggressive behaviour in recent months in offering transfer bonuses, route bonuses and credit card sign-up bonuses, you might be forgiven for thinking that you had been sold a pup.

At least British Airways didn’t have a single Tesco or American Express transfer bonus in the 18 months before the Avios devaluation.  No-one could argue that they had been persuaded to convert under false pretences.

Here is a summary of what Etihad is proposing:

Reduction of miles earned in cheaper fare classes, offset by higher miles earning on more expensive tickets.  This will only apply to new bookings made after July 8th.  The new rates are:

0.25 Etihad Guest Miles per mile flown in economy on fare classes T and E

0.75 Etihad Guest Miles per mile flown in economy on fare classes L and Q

1.15 Etihad Guest Miles per mile flown in Business on fare class Z

1.75 Etihad Guest Miles per mile flown in Business on fare class D

2.5 Etihad Guest Miles per mile flown in First on fare class R

Etihad 350

Number of reward seats in business class increasing by 20%.  I don’t understand this – Etihad traditionally releases two seats per flight in business.  Will there now be 2.4 seats?!  If the airline had any commercial nous, they would start releasing four seats per flight.  At the moment, Etihad Guest miles are very unattractive to high-end travellers with family as it is impossible to redeem in business class unless the family is split up.

Redemptions are being repriced:

Economy redemptions do not change in price and will fall for flights over 6,000 miles.  A minimum of five economy seats will be released on every flight.

Business Class redemptions will increase in price except for flights over 6,000 miles where they will remain the same.  The scale of these increases is SUBSTANTIAL – London to Abu Dhabi increases by 50%.

First Class redemptions will increase to all destinations.  It is difficult to argue about the logic here.  The difference between Business Class (44,000 miles) and First Class (55,000 miles) one-way to Abu Dhabi was too small.  However, a 59% INCREASE between London and Abu Dhabi is huge.

I have summarised the new rates between London and Abu Dhabi below.

Existing redemptions can be changed at will without triggering any price increase.

Upgrades will become more expensive and the cheapest tickets (T, E, Z) will not be upgradeable.  At present, only ‘T’ fares cannot be upgraded.

This is the best one though …. at a time of collapsing oil prices, Etihad Guest is INTRODUCING a fuel surcharge / carrier surcharge:  

It will cost $50 PER FLIGHT on economy redemptions, $100 PER FLIGHT on business class redemptions and $150 PER FLIGHT on First Class redemptions.  This is on top of the additional miles that will be required. 

Note that these are ‘per flight’ – a business class redemption to Bangkok from London via Abu Dhabi is four flights so the surcharge will be $400. 

What is impact of this on a typical redemption?

These are the new prices for redemption (return) between London and Abu Dhabi:

Today:

Economy:  62,044 miles

Business:  87,952 miles

First:  110,452 miles

After 8th July:

Economy:  62,044 miles plus $100 surcharge

Business:  131,928 miles plus $200 surcharge

First:  175,465 miles plus $300 surcharge

If you want to check the pricing on other routes, the online Mileage Calculator is here.

These are big increases.  There is no disguising it.  An increase of 50% in the miles required for a business class redemption – plus introducing a surcharge – is having a laugh.  The Avios devaluation only resulted in a 25% increase in Club World pricing if you flew off-peak.

Of course, you should look at these numbers in the context of Avios.  Given a choice between using 120,000 Avios + £550 of charges to fly Club World to Abu Dhabi or Dubai, versus 132,000 Etihad Guest miles + around £350 of charges to fly the A380 Business Class Studio it is still no contest.  Etihad Guest also gives you free chauffeur transfers at both ends as well.

Emirates Skywards now tops both of these schemes.  You will only need 90,000 miles plus around £600 of charges for a ‘Saver’ level business class return to Dubai.  If you pay the higher level of 125,000 miles you can effectively have any seat on any plane.

That said, if it turns out that I will be able to book four Etihad Guest seats in Business Class to get my family on holiday, I may even begrudgingly accept the changes.  At present, Etihad Guest is a fantastic scheme but not one I can use except for occasional solo trips.

If you don’t like the sound of these changes, I recommend that you book before July 8th if you are looking for a Business or First Class seat.

Further details can be found on the Etihad website here.

Remember that you can also redeem American Airlines miles for travel on Etihad – at least for now.  I would not put money on that deal still being in place in 12 months.  Redemptions via AA will cost substantially fewer miles (London to Abu Dhabi will be 60,000 AA miles in Business Class vs 132,000 Etihad Guest miles) and should not incur any carrier surcharges.

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Comments

  1. James67 says:

    Where are people seeing the new rates? When I use the calculator for LHR-AUH I’m only seeing the existing rates for redemptions.

    I’m also confused about the date. Do the changes only apply to bookings made on or after 8th July or do they apply to bookings made now for travel after 8th July?

    • Phillip says:

      If you click on the link to the Online Mileage Calculator in Raffles’ article, then at the top of that page is another link that says click “here” to view the rates from 8 July! The new rates will apply to bookings made on or after 8 July.

    • Jason says:

      Go into the ” How do I calculate what a GuestSeat will now cost?” link
      At the top of the page,above the 3 tabs, is a link to the updated mileage calculator

      • James67 says:

        Thanks Phillip/Jason, I kept missing that. I get the feeling my foray into Etihad is going to be a case of one and done. Just been on phone with cs, they are a joke.

  2. Howard says:

    My wife and I have 50000 AA points from that great sign up offer about a year or so ago.
    We were planning on Abu Dhabi to London in First one way (I think it was 40,000) in Etihad. Has this been effected?

  3. The Plagiarist says:

    “if it turns out that I will be able to book four Etihad Guest seats in Business Class to get my family on holiday, I may even begrudgingly accept the changes” – don’t you mean five seats, one for the nanny too!? 😉

    • We only took her to Singapore because my wife was working whilst there!

      • BlueHorizonUK says:

        I think they have opened up more availability. Looking at Business in November from Abu Dhabi to London I see 5 seats available at the lowest mileage for the same flight.

  4. Matthew says:

    This is sad news but as others say it’s inevitable. It’s a stark reminder to earn and burn in these schemes. Don’t hold on to them and don’t spend ages collecting either as the rug will be pulled from underneath your feet. Fortunately I have an A380 First return LHR-AUH booked paid for with the recent sign up bonus on the credit card and the 25% bonus MR transfers. The remaining etihad miles will prob have to be pulled out via Points Pay.

    Then my attention will move towards the next good value redemption. This is why MR points and Spg points are so valuable because you can keep them as flexible point options up until the moment you choose to redeem for a particular airline or hotel. The only problem with that is the long wait for them to post once transfer initiated!

    • My problem wih MR is that you have to have an active AMEX MR account – which if you are trying to churn your cards – isn’t very helpful…

    • These can be devalued too. The US MR to BAEC just got devalued although only for transfers after 1st oct.

    • DeltaCharlie says:

      Out of interest, how long have you been finding it take for MR to Etihad then?

      • James67 says:

        If spg points are an option for you mine just took four days.

        • DeltaCharlie says:

          MR points are my preference as I have enough for a First Return if my 25K bonus posts around statement date.

      • Jason says:

        Platinum 2 days
        Gold next day

        • DeltaCharlie says:

          Thanks, might be able to squeeze In before the deadline then… Fingers crossed as I was looking forward to that suite.

        • BlueHorizonUK says:

          platinum card sent over a load of miles yesterday afternoon and they showed up an hour ago.

    • James67 says:

      Mathew, did you get your 25k bonus from mbna within 7 days as promised and outside the regular statement run as promised?

      • Matthew says:

        No… They didn’t move across. As you suspected… They will probably arrive on the next statement due in 5 days time. I will keep you posted. I had a back up plan with some of my wife’s MR points as the family account is pretty useful with etihad.

        So I’m not entirely sure what I will do when the 20,000 post. Its a shame as it maybe to late for most if they don’t arrive before the devaluation.

        • James67 says:

          I suspected as much. My statement due on the 9th and I’m flying my economy experiment (now a big of a car crash) on 7th. Just off the phone with MBNA; I figured if I changed my staement day until today or tomorrow I might just get the points by Tuesday morning. Failed in two respects; MBNA will happily change statement dates but will not kick in until the month after next statement. As you might guess the other problem is that upgrade availability has fallen through the floor on popular routes since yesterday. The bonus points can be cashed out with points pay or redeemed for £100ish of shopping vouchers. If they prove orthless for flights it would be making best of a bad job.

          • DeltaCharlie says:

            I have just had the following message from MBNA on my points award query:
            Thanks for your message. I have reviewed your account. I can confirm that you will receive 25,000 bonus miles for £2000.00 spend within the first 90 days of opening the account. This promotion is valid for accounts, that were open between 10 April and the 10 July. You will receive your 25,000 points points, after the 10 July. You can view your statements online. Please click the “Statements” tab from the account overview page.
            HAVE WE ALL BEEN SOLD A PUP???
            I spent the £2000 in first 10 days.

          • James67 says:

            Yes, tell us about it! I did too, council tax so I lose the interest on it in savings account too. Not only that I wasted 38k spg points on them that I could have transferred to AA.

          • Danny says:

            Interest on £2000 for 90 days would be about £10, boo hoo 🙂

          • Probably more like £5 when you take into account current rubbish savings rates and income tax!

          • DeltaCharlie says:

            Cards will be cancelled tomorrow and I will just get out through Pointspay I think. Luckily have not moved any MR or SPG over as yet as I didn’t quite trust them, my hunch was right.

          • James67 says:

            May be wrong but my first glance suggested gift cards probably a better option.

            @Danny, I’m making betteruse of money than that but agreed it is still not a big sum.The bigger picture is that with the margin between redemtions and revenue fares becoming ever smaller even a small sum such as this can be significant.

    • Idrive says:

      Agree with flexibility of MR and SPG!!

      • sandgrounder says:

        Great, until they decide to slash the value of your stash overnight…..

    • Matt H says:

      I recently moved 47.5k MR points (took 4 days) with the 25% bonus going in a few days later (unsure when although all the dates online have the date I requested the transfer, not the date it hit my account).

      I was trying to get to AUH next year but I don’t know when the date will be, either Feb or March, and my Amex Gold is into fee paying territory now so I thought I good chance to cash out…

      I see there is one date change allowed on a first redemption; does anyone know yet if the date change is made after July 8th that will ruin the booking?

      • Matt H says:

        I found this:

        What happens if I booked my GuestSeat before 8 July 2015 but I want to amend that booking after the programme changes have come into effect?
        You will not be impacted. The terms and conditions at the time of booking will remain in force, whereby you will still get one change free of charge, and additional changes will incur a standard charge of around US$28 each (AED 100).

        No additional miles will be deducted from your account and you will not incur any additional charges.

  5. Eshaq Choudhury says:

    Would I be able to change my December business redemption AUH to MAN to first class at old rates AUH to LHR?

  6. *OT*

    Apologies for the OT post (although it’s about another ME airline to not totally off topic!) but anyone know of an easy/cheap way to get 250 Emirate miles? Both my parents are just 250 miles short of having 30,000 miles, which would transfer nicely across to Heathrow shopping vouchers as it needs to be in 2k increments (they were initially looking at using them with Easyjet but can’t quite decide where they’re going to go to!). You can transfer FROM Heathrow Rewards 1:1 with minimum 250, but they don’t have any points in their HR accounts. I’ve got plenty but looks like it does a name check on them. Similarly all their MR points are over with BAEC now, I could help out but it seems to do a name check too.

    Best I could see was 500 pts for an IHG hotel stay but they’ve only got a month left before they expire so it’s getting tight for things to post correctly.

    • Danny says:

      It would be easy to set up a couple of e-rewards a/cs and answer a few surveys. Looks like they need 2000 x 2 e-rewards points which is easy enough if they’re prepared to put the time in.

      • Danny says:

        http://www.emirates.com/english/skywards/about/partners/retail-leisure/e-rewards.aspx

        They would even get 200 Skywards miles just for joining up & completing 2 surveys which I think x2 gets your parents over the finishing line in itself.

        • Good suggestion, thanks Danny – hadn’t realised they were an eRewards partner. Annoyingly they’ve only got until the end of this month though so I’m not sure they’d post in time? (quotes 4-6 weeks on the page)

          • The option points from e-rewards normally transfer over in a few days – your problem would be could they get enough surveys done to reach the target needed in time – I can go a week or so without a survey offer then I get a load at the same time – a bit hit or miss – but if you get the number of surveys they transfer quickly even though it says 4-6 weeks.

          • Thanks, Liz – sounds promising, might be worth a shot!

    • Thanks to Greg (one of the other posters on here), who emailed me to remind me that Heathrow Rewards allows free transfers between members and that they’re instant! I’d actually done this before, but totally forgot about the option. I emailed them and within a few hours the points were in my folk’s accounts. I then transferred them to Emirates and those transfers went through instantly too!

      Very impressed again with Heathrow Rewards CS (so nice to get a personal reply, very promptly too) and also shows that Amex MR should be able to do these sort of instant transfers too!

      Anyway, just wanted to post an update in case it’s of use to anyone else.

  7. As a family of 5, we have to travel like the royals -ie, travel separately on different days. So not increasing seats is a missed opportunity. More negative is the huge increase in miles + the surcharges. Have way too many Etihad miles that we will force to use because seems it is nigh on impossible to use Etihad miles on their “partners”. Way too complicated and even 10 months out, there is a I availability supposedly.

    Checked for First class redemption out of JFK and for the months of Feb and March there is none on the A380. Only on the crappy Jet Airways disaster (hard product, food and service).

    The surcharges are a killer from the current ones. Guess Etihad has to make money to stave off the comments that it is getting subsidies!

    Final comment – the Etihad premium Twitter account is rubbish. All it is are people complaining about service or miles not credited and similar things. And all The Twitter people do is forward to Guest relations. Another marketing stunt which I’m sure they are regretting.

    • James67 says:

      If you have to use the miles anyway your best bet might be9 to book on spec. Worked for me way back when SQ introduced a380. There is a good chance one of two things will happen by next March. Either the 777 will be replaced by another a380 or J will be upgraded to the business suite. The latter program has already been announced and my guess is they would try to put comparable products on JFK route quickly.

  8. Sebastian says:

    How do you use Etihad miles for AA redemptions? And, have these also been affected by the changes announced? Or will they only be affected when AA announce their changes?

    • I’d be interested in knowing that as well. You obviously can’t online but not sure how easy it is by phone.

  9. Callum says:

    In the example you give, I personally think the previous rates are the ones that can be described as “having a laugh”… Business class being less than 50% more than economy is ridiculous!

    Though of course it would be better for that to be addressed by economy decreasing in price.

    • That’s true.

      However, even if you were previously ‘off market’, you need to be careful about how you adjust your pricing as your customers get very annoyed. It is a problem I have myself – there are HFP advertisers who I should have charged more as readership increased but I didn’t. It is now difficult for me to push through a huge price increase for these people because I will get push-back, whilst if I had done incremental increases along the way it would not have been an issue.

  10. Hmm, well I guess it was just a bit too good to be true.

    We’re unlikely to be in a position to redeem before the 8th July as we already have a number of trips lined up over the next year, including a BA redemption I booked before the Avios devaluation.

    So consequently what we were building up for a return trip to the Middle East or one-way further afield is likely to get us 2 x one way to the Middle East only now. Good thing I’m working towards an Avios rewards upgrade voucher that we can use in the other direction….

    Still, with 2 x 25K MBNA signup bonuses between us and ~40K of MR points converted with a 25% bonus it is still not bad value (and better than cashing out to pointspay), just nowhere near as good as we thought we were getting.

    Oh well….

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