Monthly Archives

Monthly Archives for November 2019.

Will California’s New Privacy Law Require American Airlines to Tell You Your Eagle Rating?

by Gary Leff

american airline plane
Nov 05 2019

Here’s how American Airlines scores its customers. American Airlines has a system called Helix that it uses to tell employees when to go ‘above and beyond’ for a customer. It’s used by reservations, agents at the airport, customer relations, baggage services and others as a way to know when it’s ok to spend more on a customer.

The goal of the system is to accommodate high value customers who are at risk of defecting to a competitor. Helix will display an Eagle ranking from 1-5 for each customer. This ranking is updated each day and depends on a combination of revenue and how badly you’ve been treated by the airline. You’re only going to get special treatment if your ranking is 3 or higher.

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How Much Hyatt Pays Hotels When You Redeem Points for Free Nights

by Gary Leff

Nov 05 2019

A hotel program books your room on points. They take the liability on their books for your point balance, and use it to pay the hotel.

Since hotels are mostly independently owned, they need to get real cash from the chain for your stay. Hotels actually benefit by filling unsold rooms with reward night guests, getting revenue from the loyalty program for a room that would have sat empty.

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That Didn’t Last Long: Hyatt Adding New Category 8 Hotels, and Many Limited-Participation Properties

by Gary Leff

Nov 05 2019

I don’t have an issue with limited-participation hotels, and it makes sense for timeshare hotels not to offer complimentary breakfast as an elite benefit. However it’s not really fair to say that Hyatt is growing and delivering more value to members by adding hotels where redemption is not possible.

And I think we can assume that moving five Destination Hotels into category 8 is just the beginning. We’ll eventually see more at the inflated 40,000 points per night level.

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New Push to Unionize Delta Flight Attendants

by Gary Leff

delta plane
Nov 05 2019

CEOs of American and United are pumping their fists in the air with news that the Association of Flight-Attendants-CWA has launched an effort to unionize Delta flight attendants. Finally, they’re thinking, their more profitable competitor may be saddled with the same onerous work rules that United and American face – and perhaps the better service flight attendants provide will go away in the long run, too.

Delta flight attendants can choose a union, with the costs and job protections that provides. However they can expect profit sharing to fall, the raises they’re getting without negotiation to go away. They won’t keep these things because the higher cost of unionization will trade off with wages (the value of the wage can’t exceed the value of marginal product) and because Delta will have to signal to mechanics that unionization doesn’t deliver benefits.

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British Airways Parent Company Acquires SkyTeam Member Air Europa

by Gary Leff

Nov 04 2019

IAG, parent of British Airways, also owns Iberia, Aer Lingus, Vueling, and LEVEL. Now for the price of €1 billion they’re acquiring Air Europa (10 times current earnings). The deal is expected to close in the second half of 2020.

They are currently the third largest Spanish airline, behind Iberia and Vueling already owned by IAG. This is a blow to transatlantic redemptions using Delta miles.

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