For several months I’ve been saying that United is ‘due’ for a devaluation. We now know a little bit more about how and when they’re going to do it.
It shouldn’t come as a surprise that United plans to upend their award pricing, even though their awards are expensive compared to many programs around the world.
- The last major change to United’s award chart was announced November 2013 although United effectively devalued last year through routing rules that cause many awards to cost more.
- United hired Scott Kirby as its President, the man most responsible for driving down the value of the AAdvantage program. And United now reports up to long-time Kirby lieutenant Andrew Nocella.
- The airline has been talking about — and delaying — dynamically pricing awards for two years.
- Delta has devalued several times since United, so while American Airlines more or less tried to be a little bit less expensive than competitors when it devalued last yeer United has headroom against Delta to raise prices.
Several changes are going into effect November 1. So we have some advance notice and I appreciate that.
There’s a new award chart, it’s published, and the changes to saver awards aren’t draconian.
There will be some price increases, and some modest decreases, and a new way for United to avoid offering outsized value when members redeem seats that the airline could have sold for cash.
Dynamic Award Pricing Will Replace Standard (Extra Miles) Awards
One of the best values United offers is one I never use. Their domestic extra miles awards are better than anyone else’s. The most that United charges for a one way economy domestic award is 25,000 miles. And if you have elite status or their co-brand credit card that price is available for the very last seat for sale on the plane.
United is the last airline with only two award pricing tiers, saver and standard. American, Delta, and even Alaska have multiple award pricing tiers and can charge twice as much as United for that last seat.
You always want a saver award, to spend the fewer miles possible, but in a pinch the fixed value price has meant that United could still provide real value. They’ve already increased the prices substantially of premium cabin awards, especially premium cabin international awards, at the standard level of course.
We’re going to see standard awards replaced with ‘Everyday Awards’ and those will be priced dynamically. There’s a published maximum price so they still have an award chart in some sense. A domestic one way economy may be up to 32,500 miles, a 30% increase… but it might not be.
Reasonably priced ‘standard’ or ‘rule-buster’ awards are one of my favorite things about frequent flyer miles. Knowing that in a pinch you could get on any flight any day with your points at a reasonable price is liberating, and it’s fantastic insurance. I’ve booked last seat availability awards on United when British Airways has gone on strike — just in case I needed it (I didn’t).
I don’t actually travel on these awards, but knowing they’re there means I’ve always got a worst case scenario. However the value proposition for these awards, which sell seats the airline might otherwise sell for cash, has been on their way out for years. At American they ended in their usefulness for all intents and purposes April 8, 2014. At Delta it was earlier than that. I’m sad to see what’s left of low fixed pricing go, even if it won’t change the way I usually use my miles.
More Expensive Saver Award Chart
Most changes to the saver award chart are marginal, with higher prices for United premium cabin cross country and Hawaii awards and lower prices for things you probably don’t care about like economy intra-Europe redemptions.
- United’s premium cabin cross country redemptions on Newark – Los Angeles and San Francisco and Boston – San Francisco goes from 25,000 to 35,000 miles one way while Hawaii goes from 40,000 to 50,000 miles.
- United created two-tiered pricing in 2014 for United flights versus partner flights. For instance United business class to Europe is 57,500 miles while partner airlines are 70,000. The United price will go up to 60,000 miles. Most people won’t feel this, but it’s also strange when paid prices of premium cabin travel have generally fallen somewhat (there are more discounts than ever before and saver awards are the ultimate discount seats).
- United business class to South Asia similarly bumps up from 70,000 to 75,000 miles and United business class to Australia and new Zealand goes from 70,000 to 80,000 miles each way.
New No Show Fee
There will be a no show fee of $125 that applies even to elites who want to redeposit miles after failing to show up for an award flight and not cancelling in advance.
That’s fair, it seems to me, though I’m never a fan of more fees. Don’t no show!
Don’t disagree, but sad that what would have been a major punch in the gut a few years ago, evokes little more than a sigh now.
I’m so disengaged with this program I don’t care. They only get a fraction of my wallet now where the previously had almost all of it. But at least give them credit for giving fair notification. Must suck if you’re sitting on a pile of United miles though. The way United devaluations previously worked is that if you made an award reservation prior to the devaluation you could change it after the devaluation (even online) without having to pay the new price. I burned a pile of my miles this way before the previous devaluation, using the last flight just a few months ago.
United is kind of re-affirming that this is a pattern and they will give us more devaluations going forward. They are not a good currency to hold. And the result is their credit card offerings lose value. Not that I don’t mind getting a new card for a 70K signup but I’m not going to spend a whole bunch on one of their cards for them to devalue as they see fit every 18 months. There are better places to put your spend.
This is a very timely article, as I was debating on whether to book an upcoming trip to South America with my newly acquired 70k miles earned from getting the credit card or use my AA or Alaska miles. Now I will definitely burn the UA miles right away.
The price increases don’t look so bad and I can actually book saver level international business using MP often using Star Alliance partners rather than UA without much difficulty compared to other programs where much tougher to do so (AA and DL). For that reason, this currency is more valuable than AA or DL.
These are pretty mild devaluations. I saw on another article that they claimed they were also going to open up more saver space, and if that happens then it’s worth the trade-off. Even with these I think United miles are infinitely more useful than AA miles (more availability, no fuel charges on partners) and Delta (prices all over the map that are completely unpredictable, and pretty much always worse than United Saver). If this staves off further devaluations for a little bit longer, I’m not going to be too up in arms.
@Eric they claimed more space with their 2006 devaluation too. Good luck with that.
Was an annual 1K flyer with United, and 1 million mile flyer. The constant devaluation, “overentitled elites”, and broken upgrades when the merge with Continental occurred sent me to American. I’ve been reasonably happy with the change, and each such further devaluation reinforces my decision.
Gary, I recently (April 2017) transferred a significant amount of points from Chase to United Airlines. I am a lifetime Gold member with United. Do I have any recourse against United regarding the transfer of points and can i get them to reinstate these points back to my Chase Account based on the fact that they devalued these points resulting in lower value on the points transferred?
I already cut up my Chase Mileage Plus Visa and stopped flying United just before they started dragging passengers bloody off a flight helping to re- accommodate them
Now they will cut your privates off in the name of devastation I mean devaluation
same pain just no blood
Surprise United I’ve got a cash back credit card and will never use your program or your partners again so problem solved!
In addition to dragging customers off plains and killing pets, United has made its FF plan worthless for international flights from US to Central or South America. Good luck finding real “saver” awards (unless, of course, you want to hang out for 15 hours in the middle of your flight). I just found that from US to Northern South America would require RT 70,000 miles MINIMUM. I’m ashamed that United is an US airline.