Here is something very interesting. British Airways is trialling Avios redemptions with virtually ZERO taxes.
Take a look at the screenshot below. It shows a one-way Avios redemption on British Airways from London Heathrow to Chania in Greece.
If you look at our full list of Avios redemption pricing by route (click here), you will see that Chania costs 20,000 Avios per person in Club Europe each way.
I would expect to see a price of 20,000 Avios + £25 for a Reward Flight Saver one-way redemption.
Instead, I see this (click to enlarge):
The ‘headline’ price is shown as 25,000 Avios + 50p in taxes and charges.
When you click through to the payment page, you are given this list of options:
The ‘proper’ price of 20,000 Avios + £25 is still there. However, two additional options are shown:
25,000 Avios + 50p
22,500 Avios + £12.50
These two new options are very poor value.
In the first one, you are using 5,000 additional Avios to save £24.50. This means you are getting 0.49p per Avios. This is very poor.
In the second example, you are using 2,500 additional Avios to save £12.50. This means you are getting 0.5p per Avios. Again, very weak.
There is one upside. If your plans were tentative, you would basically have no cancellations fees if you did this, as the fee is the lower of £35 or the cash supplement paid.
It happens in Economy too
If you try to book an Economy return flight to Chania (picture above), you get these options on a peak day:
27,000 Avios + £1
23,500 Avios + £17.50
20,000 Avios + £35 (the ‘usual’ price)
and then the standard mix of ‘Avios and cash’ combinations.
The maths is the same here. You are using either 3,500 Avios to save £17.50 or 7,000 Avios to save £34. Both get you 0.5p per Avios or thereabouts.
Is this a good thing or not?
On the face of it, it is fine. It gives people more options and that is generally a good thing.
Whilst you’d need to be a little crazy to accept 0.5p per Avios if you earned your points from credit card spending, Tesco Clubcard conversions, Heathrow Rewards conversions etc, you may be happy with this if all your points came from flying.
It could be a sign that BA is planning to add 7,000 Avios return to the cost of Economy redemptions and 10,000 to Club Europe and make this the new baseline, as reflected in the reward charts. This would make BA better off – because the extra Avios are being redeemed at a poor rate – and, bizarrely, may also make the Avios scheme look better to the casual traveller.
I have only seen this happening on the Chania route which implies that it is a small scale test. I imagine that if most people choose the 50p or £1 option, even though it is bad value for your points compared to the standard Reward Flight Saver option, it will be extended elsewhere.
PS. If you are wondering why British Airways has not reduced the taxes to zero, there is a technical reason. ba.com cannot handle a transaction with no charge attached to it. Until a few years ago, domestic Japan Airlines redemptions has £0 of taxes but ba.com could not book them – it only worked if you added a £1 donation to Flying Start during the check-out process!
How to earn Avios from UK credit cards (January 2021)
As a reminder, there are various ways of earning Avios from UK credit cards. Many cards also have generous sign-up bonuses!
There are two official British Airways American Express cards:
You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points, such as:
Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.
If you have a small business, we especially recommend Capital On Cap’s Visa card which comes with a generous bonus worth 10,500 Avios:
(Want to earn more Avios? Click here to visit our home page for our latest articles on earning and spending your Avios points and click here to see how to earn more Avios this month from offers and promotions.)