American Airlines Dropping Alaska Airlines Award Redemption

Two years ago American Airlines stopped allowing customers to earn miles on most Alaska Airlines flights. Alaska sources told me at the time this was a decision made by American, and one they were disappointed by.

Back in July I told you to expect even more degradation of the American Airlines-Alaska Airlines partnership.

That’s now been announced: effective March 1, 2020 it will no longer be possible to use American AAdvantage miles to redeem for travel on Alaska Airlines, and vice versa.

American tells me that there are no further changes to reciprocal lounge access or what’s left of their codesharing relationship at that time. The only change this coming March is that neither airline’s frequent flyer members will be able to redeem their miles for travel on the other carrier any longer.

Why American Says They’re Dropping Award Redemption With Alaska

American says they’re taking this step because,

  • Alaska members redeemed more on American (and in premium cabins) than American’s members redeemed on Alaska. They argue that eliminating Alaska member redemptions on American will mean more availability for American AAdvantage members, although I submit that if American had an overriding concern with award availability they’d… offer a reasonable amount of award availability to start with.

  • With Alaska’s growth, after merging with Virgin America, they now serve 97% of Alaska’s destinations. But this isn’t American serving more destinations than before, the gaps in American’s route network that Alaska helped plug remain. This is just that American serves the same cities Virgin America used to – and it isn’t even serving the same routes since American is weak in San Francisco.

Dropping More Partners is a Strange Move for American to Make Now

American isn’t serving their customers better by losing Alaska as a partner. Serving a city in the Pacific Northwest from Dallas Fort-Worth is useless to American customers in Los Angeles.

It’s particularly odd for American to own goal lose a partner now, immediately after having LATAM yanked out from under them, and this continues a trend of the airline dropping partners without adding new ones for seemingly little good reason (Cf. Gulf Air).

This is American walking even further away from competing in the Bay Area and Pacific Northwest. They just became even less relevant to customers there. My wife’s parents, for instance, living in a city only served by Alaska’s regional subsidiary Horizon Air, just found their substantial AAdvantage mileage balance useless.

To be sure customers can originate their redemption in Seattle and buy separate connecting flights, but then American won’t even through-check luggage.

If it is indeed true that Alaska members redeem more on American than vice versa, maintaining options for members would even be cash positive for American since they’d be getting paid for those net redemptions. As a result this seems petty, along the lines of immediately closing off inventory on LATAM codeshares, the needs of their customers to have options and make changes to already ticketed flights being paid no mind.

Will This Affect Other Alaska Airlines Partnerships?

Alaska continues to partner with airlines in oneworld like Qantas, Cathay Pacific, and British Airways and with independent carriers like Icelandair and Hainan Airlines. They’ve said they’ve looked at joining oneworld as a limited ‘connect carrier’.

One of the key changes that American had to make to get their joint venture with Qantas approved is that it couldn’t require Qantas to drop its partnership with Alaska. Hopefully the commitments they made to get anti-trust immunity to coordinate schedules and prices with Qantas will be upheld.

This is a Blow to American’s Profitability Engine

This appears to make little sense from an American Airlines standpoint. The airline has largely walked away from the New York market and has only a limited presence in the Bay Area and Pacific Northwest. It’s unclear why they’d want to reduce their relevance to Bay Area customers even further, as Delta builds up not just Seattle but a focus city in ex-American Airlines hub San Jose.

American generates its profit largely from credit card deals selling miles to banks. The two most important markets for credit card spend are perhaps… New York and the Bay Area.

In order to attract that spend the AAdvantage program needs to be relevant to consumers in these markets, offering them flights that take them where they want to go.

Ultimately This Shouldn’t Change How You Value AAdvantage Miles Much

It’s true that American miles do less, accessing fewer flights and destinations. And one is pressed to think of the last time there was a piece of good news for members?

While if you have a vision of visiting small towns in Alaska using miles, you should make those redemptions soon, as long as you don’t live in a primarily-Alaska city this isn’t likely to affect you much. You should be using American miles for premium cabin international redemptions on the airline’s partners like Cathay Pacific, Japan Airlines, Qantas, and Qatar.

Nonetheless I just want American AAdvantage, and American, to do something for once with its members and customers in mind instead of taking another thing away.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. And the hits just keep on coming. AS flights have usually been the only domestic F saver availability that AA.com offered.

  2. why dont you do any proofreading before you publish things? you wrote the following – what on earth does it mean?

    American isn’t serving their customers better by losing American as a partner.

  3. @Jose – EXACTLY

    Where I live, Alaska is a valuable AA differentiator. I’m not hub-captive, so I guess I have 1 less reason to choose AA instead of WN, DL, or UA.

    I’ve been burning AA miles for a bit now. With their meager redemption availability, diminishing partners, and alliance that seems perpetually under duress (MH, QR previously, now CX). I think I just need to cut it all off and get rid of their CC’s too.

  4. That is a blow to people like me with AS miles who don’t live in the Pacific Northwest. AA was my only option for domestic and Central American travel. DE is not really a good option to C2 and BA with their insane YQ was never an option to begin with.

  5. @Gary – not asking for anything that I dont think you’re capable of doing. Clarity and precision shouldnt be difficult, especially when relaying the basics of a pretty big decision. From what I understand, one can still proofread/ do a quick read of something before hitting publish, even in an uber.

  6. I read the AS website.

    You will NO LONGER earn any AS miles on AA international flights.

    So the only connection is the AS/AA lounge benefit which seems odd since you won’t earn anything on each carrier anymore.

  7. @Isaac: Codeshares remain as well. And paid lounge partnerships aren’t always tied to frequent flyer partnerships anyway. Alaska has had airport-specific agreements with United for years for some lounges, including in airports with AA lounges (PHL comes to mind).

    @Gary, I agree that this doesn’t affect the value of AA miles for passengers who don’t need to fly AS, which is probably a large fraction of AAdvantage customers. But of course it affects the value of AS miles quite a bit more, as AA provided a large fraction of the usable international awards for AS members (awful availability aside).

  8. I live in Seattle and AA miles on Alaska F has been the saving grace domestic connection for me over the year on premium cabin redemption using AA miles. JAL F SEA-LAX-NRT, CX SEA-LAX-HKG, Etihad AUH-JFK-SEA and most recently QR DOH-JFK-SEA. AS was only way to get F award seats for 4 nonstop to SEA. This is a big blow for me as I can’t hardly find any availability on JAL or CX out of SEA so I have to often re position to or from SFO or LAX or even JFK.

  9. Yep, the hits just keep on coming. I’m somewhat mystified at how Alaska members were redeeming more American flights than vice versa, given the extremely limited availability of AA awards. But so be it. Regardless, this relegates AA even more to a mileage bank for redeeming on international partners.

  10. This was the only saver first space I have ever taken using AA miles–I’ve done it 4-5 times. I have had close to no success otherwise using my AA miles in a reasonable manner in the past 12 months. I already quit AA because most of their employees hate each customer individually and hate the company as a whole, but this will have me considering a connection to Philly instead of the direct. Can’t think of any reason to fly this dumpster fire of an airline with this final blunder.

  11. I know many Alaska elite flyers that redeem AS miles for AA flights. Most have no status with AA.

    Net effect: by cutting redemption options for AS miles on AA flights, AA is losing on CHECKED BAG FEES and seat selection fees. Oops.

    I suspect this was a spur of the moment change by AA with little thought or internal analysis to the effect.

    AA is run by idiots.

  12. It’s still possible to book AS with AA miles for dates after March 2019. (I’m looking at SEA->PHX April 2020 right now) So does this announcement mean you can no longer book after March, or that flights departing after March will have their tickets cancelled?

  13. Give @Gary a break on the proof reading. I don’t think this is his full time job, and his content/analysis tends to be way better than most other bloggers (ie TPG). I appreciate proofreading from a full service site like TPG (which has been horrible the past few years, even with a full staff) but I care way less about it knowing the value Gary brings. Just my two cents.

    Thanks for your work Gary!

  14. I have found the partnership extremely useful for trips – using either type of miles – that require both airlines. And it’s not just to the Pacific Northwest and Alaska, though I do redeem for those. Just last year, the only award seat I could find to Hawaii on my available dates from my airport was using American through DFW to connect with AS at San Diego.

    No, everyone does not use American miles solely or even primarily for long haul partner redemptions, and this does devalue AA miles for me.
    The hits keep coming.

  15. I have an award ticket booked on AA in April to Las Vegas for the NFL draft. To get the cheapest saver ticket I had to book CLT-SFO-LAS (crazy I know) with the SFO-LAS flight on AS. I’m already confirmed and have a seat assignment on the AS flight. Return is all AA so this is the only segment on AS.

    My question is if you have already booked a ticket after March 2020 will that still be honored or will I get my flights disrupted. Trust me there are numerous ways AA could route me, even without the non-stop CLT-LAS flight, that would be better than CLT-SFO-LAS (actually connecting through ANY of their hubs would be better than this) but at this point I’d prefer to keep it so curious if you feel I would be adversely impacted by this decision.

  16. Actually Gary, American doing a disservice to American is an understatement and is insightful andmore truthfull

  17. @Parts Unknown – you can book 331 days out on February 28, 2020 … but you won’t be able to change these flights to other Alaska flights if you do.

  18. @Jason, People can disagree with positions and arguments but should give Gary (and other readers) a break with the obvious proofreading nitpicks. With a first-born newborn at home and work and business responsibilities, I’m amazed he posts multiple times per day. I just hope he has time to experience and enjoy.

  19. Great article, Gary. I’m surprised they’re dropping Alaska as a partner. Since their customers are booking on Alaska, I would think that’s a benefit they’re offering their membership without additional cost to them, so I don’t think it’s a great move but to each company their own!

  20. @Gary, so bookings will not be possible after March, 2020, but all ticketed flights booked before that date will be honored. No changes allowed.

  21. Why not just imitate Delta (again and again) and tell the world their partners are worthless to them unless they have invested $$ in them, like China Southern.

    American seems to be taking the wrong fork at every opportunity, and their stock price is a clear reflection of the market’s anticipation of American’s ability to compete.

  22. Why is this titled AA is dropping Alaska? They actually have no choice. This was part of the agreement the government and Alaska had in order for them to by Virgin America.

    Seriously, can’t we be objective, this is not FOX or CNN. Report the facts, not your feelings.

  23. @sunviking82 – No, that’s simply not true. The government had no requirement with respect to frequent flyer reciprocity, only codeshares.

  24. This sucks royally for AA redemptions out of The SF Bay Area. With AA slowly but surely reducing routes and frequencies, and downgauging flights, we have been lately also seeing wholesale blockage of any and all saver awards to/from SFO.

    We have no real north/south options other than LAX. The staff always said the Alaska partnership was designed to plug this. Now what is their story? Will Doug suddenly open new markets from SFO, or just continue downgauging to RJs like he did with LAX last fall? Will we ever see another seat released SFO-JFK as a saver, or is that a 90,000 mile r/t now for business? Gee, for 30k more we could continue on to Europe in Biz (but of course those seats aren’t available either.

    Does Citi understand that they’ve essentially made their cards irrelevant to Bay Area fliers, since there are no reasonably priced awards available on the remaining destinations outta here? I haven’t put a cent on my AA card in months. Why should I accrue miles I can’t use except at a horrendous premium, or with unconscionable fees tacked on?

  25. I have noticed in trying to book a couple of trip to Europe from SFO using mileage redemption for first or business, AA often used AS economy class for a long domestic leg, even though AA has its own flights. Appears AA was trying to keep customers using points off some of its own flights and force them on AS economy even if you wanted business or first supersaver. The exception is anytime first with the highest amount of points. If you eliminate AS as a potential carrier in the redemption search, you are much more limited in your options. As off late last week, AA was still showing AS flights as part of the options for award redemption to Europe, even though my trips are past the effective date of these changes. AA will need to be changing their award redemption options significantly for Bay Area flyers if AS is no longer an option.

  26. My son and i flew American form Miami to Phoenix to Seattle and then on Alaskan to Ketchican. I am a platinum for life and do not pay for up to 2 bags per trip. On the return, Alaska was the first segment and i was charged $170.00 for our 2 bags each. I explained I was an American Platinum Member and the Agent’s response was, “This is not American.Take is=t up with their customer service department. Upon my return, I wrote an email under the customer service complaint section asking for a refund as i had booked the entire flight through American and the Alaskan Flight numbers had American flight numbers associated with them. American replied that I wasn’t eligible for a refund.
    American’s benefits are getting less and less every day.

  27. Jason, Get a life…after reading his article, if you couldn’t tell that the inference was Alaskan rather than American in that sentence, then you need to watch TV instead of reading blogs. I thought the article was quite informative considering I’m almost a 3 million miler on American and my benefits are getting less and less. After a recent flight (which I just outlined) it is obvious American can care less if I continue to be a loyal customer after refusing to refund my $170.00 for a luggage charge by Alaskan, especially when 3 of the 4 segments on the return were American.
    Grammar corrections are made at school and in business, not on blogs where you have no control over the individual writing. Be happy he’s providing a service that doesn’t cost you anything and has no affect on you directly.
    From a former CEO who used to return emails from employees with grammatical errors circled in red and a requirement to return it with corrections made. (I finally got a life-retirement!)

  28. I’m having no issues with redemptions long-haul IAH to Australia via North-Asia (AA,JL), HKG (AA,CX), or trans-Pacific via SYD or MEL (AA,QF). PlanAAhead and be flexible. I’m flying F/J home for Xmas. If this means more availability in domestic F on AA metal then all the better because I never found AS redemptions of any value.

  29. @nathaniel T Russell – huh? Are you talking about FF award fees? If so I assure you AA charges $5.60 each way (security taxes) like everyone else. If you paid $80 for an award it had to have other international taxes and fees or maybe a last minute award (don’t know if there are charges for those since I’m EP and any such fee is waived for me)

  30. From all the comments, American continues to dig its own grave. Gary provides a tremendous service that passengers are able to vent, allowing others to share their frustration that AA doesn’t give a hoot, regardless of your loyalty. Feather than going into great detail, I just want to say AA simply doesn’t care about their passengers. Customer Service blocks access to taking complaints beyond their level. Have found they try to placate passengers by offering worthless miles or e-ticket vouchers rather than being responsible to compensate when they are clearly at fault. Airline service is clearly an oxymoron in dealing with AA.

  31. You are spot on with regard to American not caring about loyalty from it’s customers and Customer Service not responding accordingly!

  32. on a more basic level, does the March deadline refer to flights after that date, or the ability to make a booking after that date?

  33. I live in the Bay Area and this has little to no effect on me, although it is disappointing.

    Most my travel is international and I prefer to connect via DFW as passport control is more civilized than going through JFK or LAX.

    None of the award travel offered by Alaska has looked attractive to me.

  34. This deal only serves to diminish both American and Alaska. Your classic lose-lose situation. Nice work Doug Parker! When did you say you’re going? Please make it sooner!!

  35. for many years AS had a codeshare/mileage relationship with NW. after NW merged into DL they tried to get AS into skyteam. AS resisted because of their cozy relationship with AA. So DL said to heck with them and built a successful hub @ SEA. And not much gained by AS to stay with AA. So it’s not a surprise that this is Doug’s way to squeeze their smaller competitor.

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