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IAG planning ‘consistent elite tiers’ across BA, Iberia and Aer Lingus – what does this mean?

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Once a year, International Airlines Group – the parent company for British Airways, Aer Lingus, Iberia, LEVEL and Vueling – runs a ‘Capital Markets Day’.

This is aimed at the banks and institutions that hold the debt and bonds issued by the group, but the event has always been shared more widely. It is the single most important piece of information sharing that IAG does all year, with the heads of all of the IAG business units presenting.

To be honest, it probably wishes that it hadn’t bothered. The shares fell by 4% at one point, wiping £300m off the value of the group, as investors failed to be impressed by what they heard.

IAG planning 'consistent elite tiers' across BA, Iberia and Aer Lingus

We will do a separate article this week about the British Airways slides.

What was the Avios news from the Capital Markets Day?

There isn’t a lot in the IAG Loyalty / Avios part which regular readers of HfP won’t already know. You may be intrigued to know that fewer than 40% of Avios are awarded from flying these days.

What is interesting is slide 69 which says that you can expect, at some point:

  • ‘single Avios balance’
  • ‘improved benefits’
  • ‘cross airline recognition’
  • ‘consistent elite tiers’

It isn’t entirely clear what this means, but if we go back 6-7 years there was a plan (foiled by IAG’s IT capabilities) to turn Avios into a Miles & More-style structure.

With Miles & More, there is a single status platform used across Lufthansa, SWISS, Austrian, Brussels etc. You also have a single points balance. All of your status and points activity takes place on miles-and-more.com and not on any of the airline websites.

Moving to a ‘single Avios balance’ would have some benefits. It would save the faff of moving points between BA, Qatar Airways, Finnair, Aer Lingus / Vueling and Iberia for a start. Something which should be simple – such as using your Avios to pay for a Vueling flight on the Vueling website – is currently very messy indeed.

What does ‘consistent elite tiers’ mean?

There are two ways of reading this.

One is that each airline would simply rename its existing tiers so that Aer Lingus and Iberia top tier status is called the same thing as top-tier British Airways status. Everything else, including the different ways of earning status, remains the same.

The more radical approach would be to have a standardised way of earning status across IAG. This would require, for example, each airline to have the same thresholds for Gold, Silver etc and to earn the same number of points per flight. It could also be tied in with a move to earning status based on spending and not flights.

The snag here is that what works for one IAG airline wouldn’t work for another. Aer Lingus has a greater focus on low cost and short haul flights, for example, so any status model which heavily rewarded spending or long haul flying would wipe out their elite base.

The other snag is that, irrespective of what happens across IAG, it cannot force Finnair and Qatar Airways to adopt the same status-earning model. There is little point aligning how you earn status across some Avios-issuing airlines and not others.

Is Aer Lingus going back into oneworld?

‘Cross airline recognition’ is another interesting one. Remember that this presentation was given in the same week that we reported that BA elites would no longer get lounge access in Shannon and Cork when flying Aer Lingus.

‘Cross airline recognition’ would imply that a British Airways Gold member would get the same benefits as an Aer Lingus elite member – including lounge access.

The easiest way of achieving this would be for Aer Lingus to go back into the oneworld alliance, which also solves the issue of BA and Iberia flyers earning status credit when flying on Aer Lingus.

IAG planning 'consistent elite tiers' across BA, Iberia and Aer Lingus

Coming in 2024 ….

The presentation also told us what to expect from IAG Loyalty / Avios in 2024. Look out for:

  • BA allowing you to use ‘part pay with Avios’ to pay for 100% of a flight, as Aer Lingus and Vueling already do, rather than forcing you to pay the taxes and charges element with cash
  • more ‘Avios only’ flights, with the other IAG airlines also trialling it
  • Iberia launching ‘Reward Flight Saver’, which could actually be bad news given how low the taxes and charges on Iberia redemptions are now
  • a ‘new and improved’ hotel and car rental redemption proposition, which will hopefully get you a better deal than 0.5p per Avios

PS. Avios collectors are not rational

What is slightly worrying about the slides is that it shows that many Avios collectors are – how can I put this politely? – not economically rational.

We have written before – and it is confirmed in the slides – that allowing people to use Avios to reduce the cost of a BA Holidays package has been hugely successful. 20% of all bookings are now being part-paid with points. This is despite the fact that this is the worst possible use of Avios (0.44p per point for large volumes), especially compared to using them for a premium cabin flight redemption (1p+ per Avios).

We are also told that 80% of Avios redemptions involve the customer choosing one of the ‘more Avios, less cash’ options. On long haul this makes sense, but on short haul you make a big mistake by choosing the £1 taxes option. The £35 (Economy) or £50 (Business) taxes and charges option is usually the best, often by a large margin, assuming you value an Avios at 1p.

This is why marketing is an art and not a science. If you try to run a business on the boring principles of being better / faster / cheaper than the competition then you won’t necessarily succeed, because people are weird.

PPS. How old do you think Avios collectors are?

Here’s one interesting fact about Avios from the slides. This is the current age split of Avios collectors (and this includes Qatar Airways Privilege Club members, who will skew younger than average due to demographics):

  • 22% are under 34 years old
  • 22% are 34-44 years old
  • 39% are 45-64 years old
  • 17% are over 65 years old

How to earn Avios from UK credit cards

How to earn Avios from UK credit cards (February 2025)

As a reminder, there are various ways of earning Avios points from UK credit cards.  Many cards also have generous sign-up bonuses!

In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

Barclaycard Avios Plus card

Barclaycard Avios Plus Mastercard

Get 25,000 Avios for signing up and an upgrade voucher at £10,000 Read our full review

Barclaycard Avios card

Barclaycard Avios Mastercard

Get 5,000 Avios for signing up and an upgrade voucher at £20,000 Read our full review

There are two official British Airways American Express cards with attractive sign-up bonuses:

British Airways American Express Premium Plus

30,000 Avios and the famous annual 2-4-1 voucher Read our full review

British Airways American Express

5,000 Avios for signing up and an Economy 2-4-1 voucher for spending £15,000 Read our full review

You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points. These points convert at 1:1 into Avios.

American Express Preferred Rewards Gold

Your best beginner’s card – 20,000 points, FREE for a year & four airport lounge passes Read our full review

The Platinum Card from American Express

50,000 bonus points and great travel benefits – for a large fee Read our full review

Run your own business?

We recommend Capital on Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card, and the standard card is FREE. Capital on Tap cards also have no FX fees.

Capital on Tap Visa

NO annual fee, NO FX fees and points worth 1 Avios per £1 Read our full review

Capital on Tap Pro Visa

10,500 points (=10,500 Avios) plus good benefits Read our full review

There is also a British Airways American Express card for small businesses:

British Airways American Express Accelerating Business

30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review

There are also generous bonuses on the two American Express Business cards, with the points converting at 1:1 into Avios. These cards are open to sole traders as well as limited companies.

American Express Business Platinum

50,000 points when you sign-up and an annual £200 Amex Travel credit Read our full review

American Express Business Gold

20,000 points sign-up bonus and FREE for a year Read our full review

Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.

Comments (112)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • jjoohhnn says:

    Some random facts i noted:
    – 66% of BA’s customers live in the South East, 75% travel for leisure
    – “Full redevelopment of the global lounge estate, including Heathrow”
    – Independent back-up systems on 50% of desks in Heathrow Terminal 5

    • G says:

      And 2/3rds of BA delays are internal to BA’s poor IT and processes; not externally driven like NATS or extenuating circumstances.

      • Rob says:

        75% 🙂

        • Stu_N says:

          Slide 92 if anyone is interested in the breakdown. Quite surprising that ATC/Weather are only driver of 20% of delays, given high profile ATC capacity restrictions and impact of bad weather on operations at Heathrow.

          • Lady London says:

            Surprising it’s 75% . This does not seem to match the high rate of refusals of passengrer compensation claims under UK / EU 261 which are reported on here as refused by BA due to external factors particularly weather and NATS / air traffic control restrictions. Who knew? 🙂

      • Jonathan says:

        The days of seeing Alex Cruz wearing a hi-viz vest in a BA computer room are long gone, but not their IT problems !

    • LittleNick says:

      Also says ‘Enhanced food and beverage offering in our lounges’. I look forward to better food, hopefully sooner.

      • Lady London says:

        Hum. “Enhanced” usually means worsened or removed, when airlines use it about things connected with loyalty.

        “Enhanced” benefits announced are often ingeniously followed by a sentence indicating customer feedback caused this. The airline equivalent of the tagline, “Cats prefer it”.

        • LittleNick says:

          I unfortunately suspect you’ll be right, I do hope you’re wrong but I very much doubt it

    • Mikeact says:

      That’s us…(66%/75% +65+ !)
      I’m glad I’ve had the benefit of many FFP’s over the years, starting with AA while in the US.
      Today’s schemes have virtually changed out of all recognition, the main one possibly when reward flights really were ‘free’, and certainly none of this dynamic pricing nonsense.
      I wonder if the average collector…whoever they are….knows just how challenging it is to get a dream flight to Aus eg !
      I don’t envy today’s collectors, if you’re not flying for business.

    • Rich says:

      Yep, BA lounges differentiated from the competition, other IAG brands remaining competitive and all from 2024.

      They have a long way to go with BA lounges in a short time.

  • Jack says:

    Personally I think as you do Rob that all that will change is the name of the statuses and that the requirements to earn them will remain the same for each airline . Revenue Based status earning will not work or happen at IAG for many reasons mainly that both level and EI are low cost airlines make such a move pointless at keeping loyalty customers . It will be interesting indeed to see RFS rolled out onto other IAG airlines and what names they call the new unified tiers across the group

  • Kevin says:

    As someone living on the island of Ireland, I would love if EI became a OneWorld partner. But my brain is telling me this isn’t going to happen. I don’t think EI can be run profitably if it is a fully signed up OW member with the requirement to align with the rest of the OW members.

    Part of the reason is that EI’s home base has to compete with Ryanair. I think the majority of Dublin travellers don’t care about anything else other than getting to their destination at the cheapest price. There is no way an airline can be a fully fledged legacy airline alliance member and try to sell short haul seats for 20 Euro a pop. Ireland is just too small, even with decent tourism numbers, especially from the states.

    Personally, I think IAG should prioritise BA/IB to compete with the US3 and ME3. Shareholders need returns and the risk reward ratio is much better here than blending EI into the business to effectively share that load. EI would not be able to get anywhere near the revenue required for this to work. If I was Luis Gallego, Sean Doyle etc. I would be positioning EI to steal T/A passengers from TAP and JetBlue.

    • BA Flyer IHG Stayer says:

      er one one of the US3 (AA) is in a TATL JV with BA and IB

      One of the ME3 also has deep links with BA and IB

    • Richie says:

      For those EI routes that need to be more competitive you just sell ‘light’ fares that don’t include TPs and Lounge access and are ineligible for status.

      • Jack says:

        Not going to happen and nobody should even be suggesting this as a possibility at all . EI will not be going one world anytime soon for many reasons

    • Andrew says:

      Air Berlin were arguably a budget airline (for short haul at least) and yet were part of Oneworld. Of course we know what happened to them but their demise wasn’t really down to any extra costs incurred as a result of being in an alliance.

  • riku says:

    it will be interesting what happens to kind of rule that needs minimum 4 flights on BA to get BA gold. I don’t see how it can fit with consistent elite tiers if everything within IAG is interchangeable.

    • Stu_N says:

      Iberia flights count as “eligible flights” at the moment. The difference is that BA flights can be marketed OR operated (i.e. prime or codeshare), whereas an IB flight must be marketed AND operated by Iberia so an IB code on their metal.

      • AJA says:

        It’s a little bit more flexible than that. You can also fly on IB metal on a BA code as one of the 4 eligible flights. And I think you can also fly IB flight number on a BA operated flight.

        But an IB flight number on non-BA or non-IB metal eg IB flight number on AA metal won’t count

        • Stu_N says:

          Isn’t that all covered by BA marketed OR operated?
          IB metal/ BA code eligible as BA marketed
          IB code/ BA metal eligible as BA operated
          These are same as any other partner (e.g. replace IB with CX or QR and still works)

          IB flight number on AA doesn’t work as IB flights need to be marketed AND operated.

          In theory you could get BAEC gold without flying BA or setting foot in London but I suspect that’s very rare….

  • His Holyness says:

    What proportion of Members (identify) as male or female?

    • No longer Entitled says:

      100% allowing for a tiny rounding error. Despite what you may read in the media, there are very few people who do not identify as either male or female and should you choose to identify as a non-gender specific dog (as is your right) you are going in the hold!

      • David says:

        I identify as Rob. Only for the perks mind you!

      • John says:

        While UK passports only allow gender to be M or F, many countries allow passports with gender X including the USA and Germany, which are likely to be a relatively large source of BA customers who aren’t British.

        Though I expect that close to 100% is still the correct answer.

  • Bernard says:

    Hard to see IAG missing an opportunity to do (yet another) a stealth devaluation during this.

  • Chris W says:

    Not looking forward to RFS on Iberia…

  • Mikeact says:

    I find the ‘Q & A’s of interest at these type of presentations…..were there any ?

This article is closed to new comments. Feel free to ask your question in the HfP forums.

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