Southwest Airlines has hired an investment bank to help evaluate options for its co-brand credit card.
Southwest Airlines is considering replacing JPMorgan Chase as the issuer of its credit card rewards program, according to two people familiar with the matter.
One of those people said Southwest has hired investment bank First Annapolis as an adviser as it reviews the relationship with Chase.
Who could Southwest rope into making a credible offer for their co-brand franchise?
Does Citi have the juice to pick up a second Dallas-based airline, after shooting the moon on Costco?
American Express can’t possibly make sense for an airline that pitches itself as discount, and of the people, even in a world where Amex co-brands with Walmart and Target.
Barclaycard lost US Airways and clearly needs a prize airline. Southwest’s relationship would be cheaper than American, Delta, or United. So while Barclays doesn’t have the history of spending the sort of cash necessary to put together the Southwest deal, it seems more plausible than Barclays having been positioned to beat out Citi for American’s business.
My guess? Chase retains the business because it’s more valuable to them than a new bank, and because they have the resources. This could simply be preparation for negotiations, and a signal to Chase that they plan to negotiate hard. They see the $2 billion Delta got, the big renegotiation between American and Citi, and they want more too.
They may have chosen, then, precisely the wrong time to make their points worth so much less.
(HT: Miles to Memories)
I’m unloading my SWA cards shortly. Have three and renew them because the annual point bonus USED to offset the fee. I don’t see that as the case moving forward. Plus, should Chase retain them, I’m really just resetting the clock at worst.
Nice timing, as Mrs B is dumping her Chase Southwest card as < .014 per mile doesn't cut it anymore.
It’s amazing how the spend calculus for this card has really changed in just over 2 years. Now points for WGA fares are down to a valuation of as little as 1.25/cents per point, down from 1.67/cents when RR 2.0 first launched.
I let my 2 SW cards go, as the bonus points for renewal were basically just worth the price of the Annual Fee. Thought I might just as well buy the ticket and get more points for the purchase, rather than pay the fee for points I didn’t even need yet. Now that they have gone Delta-esque with an unknown value for points, the case for renewing the card is even weaker.
How many points are awarded for the annual bonus? Am 6 months away from my 2-yr anniversary, and a little perturbed at the devaluation. The annual fee is $100. Are the annual bonus pts worth anywhere-near $100?
I do not agree:
http://money.usnews.com/money/blogs/my-money/2014/06/12/the-dos-and-donts-of-closing-credit-cards
Tina