Insights from American’s Suzanne Rubin on What’s Next for the Program

American and US Airways made more program in the integration of their airlines and frequent flyer programs today.

And we learned a little bit about their strategy going forward. I spoke with American AAdvantage President Suzanne Rubin to get an idea of what these changes mean, and what to expect next.

Here’s my observations about what the announcements mean:

  1. The US Airways award chart changes were announced in advance, with changes not taking effect for nearly 3 months. This is the first time I ever remember US Airways making an advance announcement of an award chart change. It seems that American did learn something from the firestorm that erupted after their April 8 changes without notice.
  2. They’re making as little temporary IT investment as possible. They’ve taken a half step in upgrades, but they built it on top of an existing system (buy ups at check-in that already exist will simply be free for elites at each airline). No reason to spend money on the US Airways platform that’s going away, or for a process at American that will be very temporary.
  3. This is the only upgrade process we should expect for each airline’s elites when flying the other carrier. The next step for upgrades will come when the two airlines actually become one.
  4. We won’t see a lot of major changes to the programs between now and the time they’re combined, just some tinkering at the margins. They could have adjusted more awards, or adjusted up the price of 3-cabin North America awards at both American and US Airways to a new higher level, but they chose not to do it.

I asked Suzanne Rubin about what comes next, and they’re not ready to announce when the airline will combine so not ready to announce when the programs will combine.

I asked her about the ability to move points back and forth between programs, to give US Airways members access to one-way awards now and American’s members access to what Dividend Miles members have (cough).

She pointed out that,

Members now have ability to redeem out of single account for travel on either airline, and there are industry opportunities to move points, but we don’t have anything ready to communicate on something functionally to allow movement of miles across two accounts but we have spent a lot of time on linking accounts, letting members do it.

The ‘industry opportunities’ refers of course to transfers, so it’s technically possible to do although not ever at a rate where I would do it other than to keep miles active in an account or generate activity with a partner when there’s a bonus offer for doing so.

The next thing they’re working on is

[H]ow to go about the process of integrating the two programs, we may see some things, minor policy changes to help prepare for integration. We’re going through the terms and conditions, through every policy in the program, but don’t expect much to change in the interim. We’re focused on getting ready to undertake the integration.

Linking accounts and integration is a big deal. Focus on big picture, the wins for the airline come from bringing the two programs together not from making changes at the margin to each program now. That’s the message I got.

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, 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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  1. Very disappointed at the cheapness they are showing on the IT front. CO/UA (and I think DL/NW) invested in their IT platforms to ensure reciprocal upgrades during the merger. UA/CO were in a very similar situation even, with UA ditching Apollo in the same way US is ditching SHARES now. It makes me nervous that they are being so cheap now (and indeed if the meal cuts rumor is true), it doesn’t bode well for the future US-ification of AA…

  2. @Chase the meal cuts aren’t a rumor, it’s straight from corporate communications and confirmed. And I actually agree with you (you’ll be hearing more from me on this) about the need to invest in more integration, their excuse is they had more work to do because Continental was already in Star, Northwest was already in Skyteam, but they didn’t partner with US Airways at all. Even US Airways/America West managed to do reciprocal points transfers in advance of integrating programs and the airlines, and that was going on a decade ago!

  3. I get the impression that the slowness to allow transfers between accounts is not due to IT, but instead to wait until there is a “new” program in place, whatever that might mean. Put another way, I suspect a substantial devaluation before the opportunity to merge account balances is put in place. It makes sense from a financial perspective – allowing the transfers will create a huge influx of points (and presumably then, redemptions).

  4. I’m going to bet that the meal cuts are a stage show. AA is waiting for the uproar so they can roll back to DL standards and say they ‘compromised’ when in fact that was the goal all along,

    Sorry, I don’t buy the ‘previous partner’ argument. CO already invested in the functionality to implement partner upgrades in SHARES through the merger with UA. All US needs to do is pay the licensing fees for those changes, and they won’t do it. Period. Granted, Sabre has not had this functionality before and Is probably a size able investment for AA to implement on temp basis. But still, don’t lie to your customers…

  5. So what will happen to people who were shut down by the terrorist Bartulevicz without any cause?
    Will they also lose their US miles when the merger goes through?

  6. In early 2015 I have a TATL ticket in economy (booking class O), booked on AA stock, on flights operated by US. How can I upgrade to C using miles/cash?

  7. Last weekend I flee US for the first time since the merger (it was an AA codeshare). I am EP on AA, no status on US. One simple perk I would like to see provided on US for AA elites is free ‘Same Day Standby’. It doesn’t cost the airline much because it just uses unused inventory….potentially they could even sell my empty seat on the original flight. Both IT systems have a similar feature. I use this all the time with AA.
    I asked the agent at the US club, she said there was no way to do this for free at this time (she could do it for $75)

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