The June issue of Inside Flyer runs a cover story on the value of miles, how to think about when to use them, and what value to expect back in return for those redemptions.
The piece includes a sidebar Q&A with me and with Lucky.
We agree on most points. Delta Skypesos are the least valuable major mileage currency in North America. United’s Starnet blocking is a huge detriment to the value of their mileage. International premium cabin awards are the best use of miles, though they aren’t ‘worth’ for most people the sticker price that airlines charge for paid versions of the same itineraries.. We both like Aeroplan.
Our disagreements? Lucky thinks miles have gotten less valuable because of award chart inflation (a fair point) while I think that on the whole they’ve gotten more valuable because they’re easier to earn and alliance awards have come about and become more robust (with addition of new partners).
What say you — are miles worth more or less than they were five and ten years ago?
> are miles worth more or less than they were five and ten years ago?
To answer this, you could compare the actual cost of a flight (now and then) with the miles required now and then. With 2010’s summer airfares going through the roof, I’d prefer to be nostalgic and believe that the miles have devalued less.
One thing that would make me think that they are worth less is that many tickets (e.g. discount) now only earn a portion of the real miles flown (e.g. 25%) and then on top of that, the only fares you can upgrade are full fares. Essentially, it is impossible to get value out of Flying Blue.
It is exactly for this reason that we no longer fly KLM between N America and Europe. BA is MUCH more generous with their miles program.
I think they are worth a bit less: with fewer aircraft flying, and those that are flying are at a higher capacity than in the recent past — it becomes more difficult to get an award seat. Miles are not worth much if you cannot use them.
Many major non-US based programs have gotten much worse in value over the past few years. Higher mileage cost for awards, significant fuel surcharges, more fees, lower earning rates.
However some FFPs have increased in value – eg for newish airlines and those which have joined an alliance.
I am interested in knowing why Aeroplan seems to be everybody’s favorite (or one of them). As a newcomer to this whole miles and award booking deal, i am have been trying to decide where to park my Membership Rewards and SPG points and when i look at Star Alliance, Aeroplan and ANA offer the best deals for transferring MR and SPG points (1:1). But a transatlantic booking costs 43000 miles in ANA and 60000 in Aeroplan. So isn’t booking Star Alliance travel through ANA better than booking through Aeroplan? Am i missing something here?
Also, apologies – i didn’t mean to veer away from the discussion about the valuation of miles. Just thought it was interesting that both of you really like Aeroplan.
My CO miles got a lot more valuable to me with the switch to Star Alliance last year. But the switch to one way awards with AA cut into the value of my miles there in a big way with the loss of most stopovers.
I get exactly what I need from the Skymiles program, easily earned miles and good domestic availability. This matches my need perfectly since I’d prefer to use miles than pay ~$400 for a domestic ticket. Some might call it shortsighted to not save the miles for something bigger or more expensive, but I’m saving my $$ for other things…
@Johnny Triump, you’d come out ahead with a good 2% cashback card and not face capacity restrictions at all.
I can’t be the only one who sees the hilarity in seeing someone who proudly paid $200 for a meal seriously “discussing the value” of ANYTHING? Anyone? 🙂
@jjoyce, value such things differently if you wish, but I actually think that lunch (and the dinner I blogged about at El Bulli a couple years back for that matter) were amazing values. Way better than half a dozen lesser meals combined…
The only real value of miles is the ability to spend them, not earn them. If you can find an award that satisfies your need, you have found some value. Of course, as airlines charge for luggage, add fuel surcharges for international flights, and charge fees for converting miles into “free” tickets, the value of miles is further weakened. I agree with both views and conclude the value of miles is neither better or worse than 5 – 10 years ago.