Miles & More ends flexible flight redemptions as it goes revenue based

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• LittleNick says:

  25 Feb25 February 14:10

  Seems BA/VS/LH are all trying to out do one another with ‘enhancements’

  • JDB says:

    25 Feb25 February 14:24

    One can only hope that the IAG Loyalty/Avios universe is sufficiently important to the group that BA won’t be allowed to do anything too bonkers. Neither VS nor LH has such an important and profitable set up of selling points through cards, subscriptions, boost etc. much of which would be killed off.

    BA has also severely damaged loyalty for many via the TP changes, so if they take away the Avios redemption incentive as well, there’s increasingly little left.

    • daveinitalia says:

      25 Feb25 February 15:38

      LH seems to have M&M credit cards available in many markets still, although to be fair their home market is one where most people still use cash.

      • Rob says:

        25 Feb25 February 15:44

        I think Lufthansa has, globally, cards in more countries than any other airline – albeit even combined they won’t even be a fraction as lucrative as the big US airline card deals.

      • JDB says:

        25 Feb25 February 16:07

        Miles and More contributed around 2% of LH group earnings in 2023, IAG Loyalty is closer to 10%. These numbers may well not tell the whole story! M&M has more members and may have more credit cards but given the nature of its principal home market, credit cards aren’t as big a deal as they might be.

        • Phillip says:

          25 Feb25 February 16:53

          Am I right in thinking that you could earn status from the M&M cards? In Germany at least?

        • Bagoly says:

          26 Feb26 February 09:26

          But the 10% is completely artificial based on the price charged for transactions between the two divisions.
          What those two figures do suggest is that the results of M&M are not artificially inflated by have very low internal purchase/high internal sale pricing. That would explain why redemptions are expensive, but not why there are few of them.

    • LittleNick says:

      25 Feb25 February 20:58

      I can only hope you’re right @JDB and hope IAG see the value that IAGL bring to the group and resist BA’s attempts of devaluing the programme

      • Rob says:

        25 Feb25 February 21:04

        I was told that, so far, this has been the case. IAGL has a lot of power in IAG because the high implied valuation multiple means £1 profit is worth 2x £1 of BA profit on the market cap.

    • John says:

      25 Feb25 February 21:37

      According to aviation consultant On-Point Loyalty, the Miles and More program is more valuable than all Avios programs combined.

      LH certainly has as profitable a setup of selling miles. LH M&M was an innovator when it comes to non-air partners and the partner network in their home markets (Germany, Switzerland, Austria, Belgium, and now Italy) is huge. I’d also dispute their credit-card network is smaller.

    • Lady London says:

      26 Feb26 February 13:19

      Well… if something happens to make the price of cash tickets drop across the board, eg, a major world recession etc, these airlines are going to look a bit sick. I wonder how long will it take them tben to unwind dynamic revenue-cost-basic pricing for awards?

      • Ziggy says:

        26 Feb26 February 20:39

        They won’t unwind. If dynamic pricing in a recession results in fewer miles/points being needed for awards, the surcharges on those awards will be increased to make sure the passenger still has to pay whatever the airline wants/needs.

• Paul says:

  25 Feb25 February 18:01

  Have burnt over 500,000 Avios on flights starting day after tomorrow and running through to September. BA will almost certainly move to revenue based redemptions and this year. It is absolutely inevitable and is the unbundling of lounge access and fast track from J class fares.

  Spend spend spend people!!

  • LittleNick says:

    25 Feb25 February 19:56

    Thanks, I suspect you may be right. Obviously quite devastating but I think it’s inevitable

  • RC says:

    26 Feb26 February 00:17

    It’s coming.
    Why should BA give away say club Europe to Faro for say 35,000 Avios or £350 return if Avios is worth 1p, when a fare with sane flexibility in July/August is £1240 return and is really worth 124,000 Avios?
    Also if fare sale JFK is £1800 return, shouldn’t it be 180,000 Avios, not 200,000 plus about £800 of extras?
    Genuinely seems fairer – and also matched how you earn Avios

    • Dubious says:

      27 Feb27 February 04:50

      RC. Although those flexible fares bought with Avios have a lower availability than these cash comparators.

  • Thywillbedone says:

    26 Feb26 February 07:39

    I agree Paul. I have burnt a similar amount recently and am actively trying to spend the rest. As I said in the comments yesterday: when airlines collude (and it certainly feels like collusion) to rinse the value from their loyalty schemes, there isn’t a damn thing any of us can do about it bar writing an angry letter to The Times. Unfortunately, it has become a hobby without any fun in it.

  • JDB says:

    26 Feb26 February 08:48

    Will we all really step away from earning miles? I think it’s extremely unlikely.

    Whatever changes may be coming, there will continue to be great opportunities. I think some will drop out which isn’t surprising because it’s clear from comments and forum posts that there are a lot of new points/voucher collectors who really don’t understand how it all works.

    • Andrew J says:

      26 Feb26 February 08:55

      I think it’s extremely likely for many.

    • Mark says:

      26 Feb26 February 09:19

      Indeed, those of us who have been in this game for some time have learned to adapt. We can all see which way the tide is turning, and that change is highly likely, whether imminent or not. I, for one, will not be rushing to make lots of redemption bookings on trips we don’t really want or for things were the value is sub-par just to get rid of them. But then I’ve never threatened to do that, nor do I convert all my Virgin points to Hilton during the pandemic as some did. There’s always a level of risk in holding miles and earn and burn is a good strategy, but holding your nerve has equally proven worthwhile.

      That said if changes (not just BA but across all airlines that use it as their FF currency) make it a lot less attractive to hold and use Avios in the future then our strategy will adjust accordingly, just like it has for Virgin. Some of the best cash deals already decent value without the lock-in, albeit often require indirect routings or a positioning flight. Depending on time and flexibility the opportunity to see some places you might not otherwise go could be a positive.

    • BA Flyer IHG Stayer says:

      26 Feb26 February 10:53

      There are a lot of old points collectors who don’t understand how it works either.

      I still see and hear comments like “I’m saving up for a free flight”. I imagine Rob gets several emails a week on that topic too covering many airlines.

      And there is still often a lack of basic knowledge of how the schemes work and we still see it now with the change to BAs collection year for example.

      • Rob says:

        26 Feb26 February 10:59

        You’d be shocked at the knowledge shown in some of the emails I get, and these are not from beginners – they often start ‘I’ve been collecting Avios for 10 years’.

    • John says:

      26 Feb26 February 23:13

      Collecting avios for 10 years doesn’t necessarily make you experienced or advanced… If you looked up how much you needed for a flight in 2015 and it took you this long to accumulate it (eg my dad who collected miles for my entire childhood and only just about had enough for one set of economy long hauls for the family by the time I knew enough to optimise future collecting)

  • BA Flyer IHG Stayer says:

    26 Feb26 February 14:50

    Only have about 60- 70k left to spend and I’m using those for some European short hauls

    Not because I’m worried about a devaluation but because it’s the best use for them value wise.

• JDB says:

  26 Feb26 February 07:33

  The “tax avoidance flights” as you refer to them are rather more than that. In addition to not paying the c.£200 APD flying from continental European cities, base fares are in general significantly lower, so there are still very substantial savings particularly for flying to Asia/Australia.

  Re hoping BA will go the way of Virgin, they aren’t really very comparable airlines! Virgin only has 30 odd destinations, all long haul and concentrated on the US/Caribbean.

  • BA Flyer IHG Stayer says:

    26 Feb26 February 11:06

    @Nigel I’ve saved £ 1k by starting my current trip to NYC in AMS and that takes into account the positioning flights to/from AMS to book end the trip and the extra night I needed at the T4 CP to make it happen.

    If I was only saving the APD I simply wouldn’t have booked it this way because there wouldn’t have been any savings.

    The savings are because BA is trying to steal passengers in AMS from KL for example so reduces its prices by reducing the surcharges. KL does the same with some UK airports – if you’re having to change flights anyway might was well do it at Schiphol

    Most people won’t do it because they don’t want the bother of extra flights.

    I managed to persuade one of my Dutch friends to do an Ex-UK flight on KL which was still massively cheaper than originating the direct ex AMS one.

• Matthias says:

  26 Feb26 February 07:53

  I always thought BA”s short haul strategy, to a large extent, was revenue maximisation rather than load factor – meaning they were happy to charge a lot for seats sold and accept there’d be a lot of empty seats. Which would make a revenue based strategy a bit weird as you’d genuinely be leaving seats empty that you can currently get rid of “on the side” via Avios redemptions. Same on some high frequency long hauls like New York, I thought.

  I get the point on peak summer Avios seats being wasted, but that’s only because of the guaranteed 8+4, otherwise there is already no availability. So if that’s the main problem you could just reduce that to say 4+2, or eliminate entirely. People wouldn’t be happy but presumably still happier than revenue based redemptions.

  • Bagoly says:

    26 Feb26 February 10:22

    And Germans don’t really get the idea of get rid of “on the side”.
    Discounts on end-of-line items in UK shops are typically 50-80%; in Germany even bashed-up boxes on the discount shelf are typically 20% off.
    Meilenschnappen have been good, but have apparently fallen foul of that mentality.

  • PH says:

    26 Feb26 February 22:20

    I feel there would be more discounting in other ways if redemptions went revenue based. BA has some of the largest long haul J cabins in the world..

• Andrew J says:

  26 Feb26 February 08:02

  Loyalty programmes really are on their way out aren’t they.

• sigma421 says:

  26 Feb26 February 08:59

  Isn’t the big risk with cash based redemptions that nobody really invests in the programme or saves? If my miles are worth the same for every flight, I’ll just use them for a trip to Zurich, rather than saving them for a club return to somewhere exotic. Don’t airlines risk becoming like Nectar (at least pre- the extra points offers which have made it a bit more interesting at the earn side). Yes I’ll take £2.50 off my shopping when I hit the target but I’m not really invested in it?

  • Bagoly says:

    26 Feb26 February 10:24

    Which prompts the question – is the head of Nectar paid the same as the heads of Loyalty at the airlines?

    • Rob says:

      26 Feb26 February 10:46

      I doubt anyone is getting paid a lot to run Nectar on behalf of Sainsburys. Adam got £890k in 2023 for running IAGL.

      • BA Flyer IHG Stayer says:

        26 Feb26 February 14:34

        Is that because IAGL is an active profit maker and can sell lots of avios to the likes of the credit card companies and Nectar (and to individuals too)?

        Whereas Nectar is more diffuse as you can’t easily measure if Nectar is driving additional spend so is relatively easy to run? Who is nectar selling points to for example?

        If there wasn’t nectar I’d still be using my Sainsbury’s local for milk and a sandwich as it’s the closest shop to me for those things if that’s all I need.

        • ed_fly says:

          26 Feb26 February 19:52

          I find nectar encouraging me to make irrational decisions, the extra few minutes walking to get small items from there is made worth while by the bonus points they award once a day, the scratch the screen ‘game’. The potential for 20-40 points makes me choose them over (slightly) more convenient options. Which in itself is driven by my desire to boost my Avios balance.

  • John says:

    26 Feb26 February 23:18

    The extra points offers have just made the items I would be buying anyway slightly cheaper.

    I’m surprised that people change their behaviour over 10p

• NotGrumpy says:

  26 Feb26 February 09:59

  If points become directly equatable to monetary value at spend (1 Avios always spends at 1p or whatever) could that change the tax treatment they get when acquired via work?

  • Bagoly says:

    26 Feb26 February 10:23

    Lufty seem very alive to the risk of direct monetary value, given the claim from a disgruntled customer to get the M&Ms as cash.

  • BA Flyer IHG Stayer says:

    26 Feb26 February 14:36

    I’m sure HMRC would be delighted to collect a few quid here and there from points in these circumstances but in reality it’s not worth the effort for them.

• PointingIsRude says:

  26 Feb26 February 17:45

  I was just invited for a Miles and More status match, at €99 until Feb 2026. Silver seems to give you Frequent Traveller status and Gold for Senator. Only open to BA and Iberia loyalty matches.

  Doesn’t seem to make sense for me as I have Silver for another year and have Amex platinum for the lounge anyway.

  https://lufthansa.statusmatch.com/?fpr=30ofc

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