British Airways adds £100 to the taxes and charges on business class Avios redemptions

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• Catalan says:

  16 Mar16 March 16:24

  Emirates have just increased fuel surcharges on award tickets.
  It’s spreading like omicron!

• IanT says:

  16 Mar16 March 19:01

  Today I had notification that BA are refunding my FTV (£962 in fees, 122500 avios and a 2-4-1 voucher) and when it’s processed I’ll transfer to nectar and let the 2-4-1 die.

  I used to do everything to collect avios, including buying strange vegeatables and pre-ordering games from Tesco that I had no intention of ever playing.

  Of course, those silly days couldn’t last forever (we all knew that really), but I’m not prepared to chase ever decreasing value any longer.

  I’m pretty much done.

• Mark says:

  16 Mar16 March 19:53

  I think what a lot of people are missing is that flight prices are likely to be sharply up across the board, partly due to the impact of debt incurred over the past couple of years, but significantly also due to the spike in oil prices. Of course it makes a lot of sense to keep an eye on cash prices. We flew to Hong Kong with Lufthansa right at the start of the pandemic for £1000 each – there’s no way a redemption would have made sense in that scenario even then. Conversely, we booked a BA 2for1 for next February a couple of weeks ago for just under £650 plus 62,500 avios each in BA Club World. [It should have been £600 each in tax but I nabbed the return flights in a separate online booking as they were disappearing in minutes and phoned BA afterwards to get the 50% avios refunded.] Taking into account the Amex fee less 5,000 additional avios earned on £10K spend and 1p/avios, that’s about £1370 each by my reckoning, which for Club Suite (hopefully) to the Caribbean in peak season is reasonable in my book. Current cash fare for the same flights is £5K each… I seriously doubt there’s any chance of a cash deal from London coming anywhere near, and would almost certainly involve connections and (very) extended travel times.

  A quick look at current ex-EU options reveals Air Canada from Amsterdam is going for £1586 at 31h30 outbound and 41h back, and that’s once you’ve got to AMS…..

• To clarify says:

  16 Mar16 March 20:18

  I think your comments on hedging are misleading. Hedging doesn’t have to cost if done properly. It needs to be done by people who know what they are doing!
  Also your example of Delta is misleading, as they bough a refinery on the East Coast a few years ago.

  • Rob says:

    16 Mar16 March 20:31

    No they’re not. It’s like any other sort of insurance. If you can afford the loss, smart money does not insure. (We don’t insure our house contents, we do insure the house.)

    Goldman Sachs etc are on the other side of the hedge. Who do you think wins?

    • qrfan says:

      16 Mar16 March 20:41

      Hedging future kerosene expenses with WTI futures is really nothing at all like paying a premium for insurance.

    • To clarify says:

      16 Mar16 March 20:44

      Again the comments are simplifying a lot the situation, and not only banks are on the other side of the hedge, in the oil market. Owning a refinery, Delta is naturally hedged and have been drawing massive benefits from their investments in the refinery at times and the other way in other times. The oil market is very cyclical. Anyway saying Delta doesn’t hedge is not exactly true…

      • Rob says:

        16 Mar16 March 22:27

        Ed Bastian told me yesterday in those exact words so I am happy to quote them.

        Not sure how owning a refinery is a hedge anyway given that the input costs increases too. Now, owning an oil field ….

• Cheshire Pete says:

  16 Mar16 March 21:54

  Between 2 of us, we now have 6 (six) 241 vouchers varying in expiration up to 2023/24. So irrespective of sending a message to Amex/ BA about the now extortionate Taxes/Surcharges, I can’t actually think why I need the BAPP until perhaps sometime late in 2023. I think I’ll be downgrading, but for a more practical reason of I don’t need anymore in the next 18 months! Obviously seeing a BA Holiday which is only £600 more for cash including a hotel and then converting 120,000 of our Avios pile we would have used to near £1000 in cash just reinforces the logical choices here!

  • Mark says:

    16 Mar16 March 22:32

    We also did a BA Holidays trip to NYC – booked in WT+ with Avios upgrade to CW. With a hotel it ended up costing around £750 more for the two of us than the taxes and fees on a CW 2for1 redemption, offset by around 34K fewer avios taking into account those earned from the flight, CC and BA Holidays. Given we stayed in Manhattan for a week that was something of a no-brainer….

  • Jonathan says:

    17 Mar17 March 01:15

    Amex have made their BAPP card very unattractive now, with its £250 annual fee, when it was £150 then £195, people weren’t so bothered about swallowing the fee, (some like Rob never had to pay the fee until recently !) but the increase in the fee has definitely made people look at if the card is actually value for money, I guess there other perks the card offers over BA Blue, other than the 241 voucher, things like travel inconvenience insurance, double Avios when spending on BA.com / BA holidays, why BA Blue can’t offer this, but the the free Virgin Atlantic card does (when spending directly with the latter in their websites) is something I still can’t quite figure out, but either way though, travel restrictions mean that people don’t need 241 vouchers any time soon ! You could be booked to go to somewhere, and then the country will lock down their borders to only allow citizens / permanent residents to return (although this more unlikely now, it’s still something that can’t be ruled out while COVID-19 is still a threat to public health

• Tony says:

  16 Mar16 March 22:18

  Would it be true to say that the rattling of cages on here doesn’t really bother BA or Amex? I would imagine the bulk of BA/Amex cardholders are average middle class people who like a perceived reward, and don’t have the time or inclination to see beyond “2 for 1! and I only pay the taxes!”. My guess is most people redeeming a 2 for 1 voucher have no idea that associated taxes/charges have gone up.

• Chris R says:

  16 Mar16 March 23:06

  Am I naive in thinking this is only short term to reflect fuel prices and post COVID operating losses and this additional levy will be reduced?

  Like others, I’m struggling to now see the value in redemptions. With avios and 241, I previously considered it to be like paying for economy and getting Club World with points. Now I’m paying £700-£800 above an economy flight for CW whilst using points and 241, before factoring in £250 BAPP. Yes, probably still good value to be had versus cash CW fares, but I’m in the population where I wouldn’t be prepared to pay cash anyway for those fares (would rather upgrade hotel or have extra spending money on holiday).

  Just paid annual fee on BAPP, so currently wondering what’s best.

  • Martin says:

    17 Mar17 March 05:37

    For those on the north west Avios are becoming a waste of time. Not only do we have to suffer Manchester Airport but options to use them are limited other than trekking to London. But is this current issue generally a bubble due to pent up demand lack of availability with fewer / smaller planes and airlines having to accommodate 2 years of cancellations and FTVs etc? Don’t forget it was not so long ago that BA had a huge Avios sale to encourage us to spend. How many people actually flew on those flights? My view is that in 18 months or so when these factors have washed through we may see more availability and offers – don’t forget we are about to suffer a drop in living standards if the commentators are to be believed which will further reduce demand. I’m just going to continue collecting and then see what happens. I can switch to the premium BA card when I need the 2 4 1 if need be.

    • NorthernLass says:

      17 Mar17 March 06:27

      The options are very limited, I agree, however there is the possibility with the new 241 of getting a very quick and cheap flight to DUB (which could start at LPL, thereby avoiding the 7 levels of hell which is MAN) and commencing a long haul trip from there to reduce surcharges. For me this would also bring the opportunity to have a mini break in DUB as I’ve never yet managed to visit – despite living nearer to there than London or Edinburgh!

      • memesweeper says:

        17 Mar17 March 07:12

        Dublin is perfect for a mini-break.

        The number of people who will go ex-Eu for the start of a holiday is vanishingly small though. Neither the treasury nor BA will be bothered by it.

        • Jeff77 says:

          17 Mar17 March 10:09

          Adding an extra day trip for a long haul trip is fine if you have unlimited holidays/are retired but a lot of people won’t want to waste a day travelling to eg America via Ireland.

    • Londonsteve says:

      17 Mar17 March 15:33

      I agree that this is a transitory state of affairs. Things are changing before our very eyes, with a haste few of us can recall in living memory. The European refugee crisis and the effects on the wider European labour market are likely to serve to depress wage growth in a very high inflation environment, energy prices are going beserk serving to not only reduce everyone’s disposable income, it makes flying, especially long haul journeys significantly more expensive. Covid has not finished ravaging our societies and the global financial crisis is well overdue and arguably royally justified by highly overvalued asset prices and vast indebtedness build up during a period of near-zero interest rates. These rates will need to not just come off the floor, they have to develop wings and soar in order to avoid monetary collapse in the western world and impoverishing entire nations. The Ukrainian war and Russia’s impending economic collapse, to major destruction of shareholder value for western companies that operated in Russia, default on sovereign debt, as well as things like the outright hijacking of the leased aircraft fleet may just tip things over the edge. Last but not least is the dramatic and permanent decline in high yielding business travel due to new working patterns and much improved communications technology and parts of the globe to which travel remains off limits. Against this frankly panic-inducing backdrop, I struggle to see how more than a handful of people within a few years time will be willing and able to pay for the volume of premium seats we are seeing currently occupied, giving airlines a very serious headache. Will they fill them at ‘cost’ to stem the bleed, or acknowledge a new economic reality and increase seating in Y? My suspicion is that initially we’ll see a glut of good deals for cash and miles to drum up business, after a while like First, enormous J cabins will become more of an endangered species allowing airlines to charge high fares to the handful of people that are willing and able to pay for it. With enormous inflation underway, virtually uncontrolled energy price rises and significant headwinds for the aviation sector in general with slings and arrows arriving from all directions, by necessity premium flying is going up and will have to remain so. The bargain fares will be relative and for many of us it means that the front of the plane becomes out of bounds, whether for cash, miles, or some combination thereof.

• Martin says:

  17 Mar17 March 08:06

  I am not sure what folk expected. In the UK, interest rates for savings have lagged inflation for a few years now. Expecting Avios to behave like gold is being optimistic.

  As regards long haul club (CW), I suspect the new Suites have a lower seating density than the old layout. Inevitably, BA will want to maintain revenue from the CW cabin.

  • Mark says:

    17 Mar17 March 10:33

    They do have a lower seating density, though not by as much as you might think and it doesn’t necessarily mean fewer CW seats. In the end BA will set its prices based on how it thinks it can maximise revenues and/or profit across its route network. Many factors will influence that, including route product, price and convenience competition, people’s / corporate budgets, willingness to travel and capacity (bear in mind many airlines, including BA, have retired aircraft during the pandemic).

    The way the pricing is structured (e.g. in terms of discounted corporate fares vs general retail) is also important. As I Rob has alluded to, I think that is driving what we are seeing currently in the ‘carrier surcharge’ increases.

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