Should You Let New Pricing Changes Extort You Into Taking A Delta Co-Brand Credit Card

Award travel on Delta is now 17.6% higher for SkyMiles members who do not have an American Express co-brand. That’s because having a co-brand Delta Amex (Gold and higher) comes with ‘TakeOff 15’, a 15% discount on Delta award travel. Those without the card pay 17.6% more miles than those without it.

Award Discounts Aren’t Unusual, This One Is

Now, United Airlines offers a discount on award travel too – this isn’t just for co-brand cardmembers, it is also for elite frequent flyers. So United Silvers (Marriott Titaniums) and those who get a status match access the discount as well.

MileagePlus says engaged members of the program, engaged in some way, get lower redemption costs. By the way British Airways offers lower redemption costs on intra-Europe travel for active accounts too. That’s not unusual.

What’s unusual is Delta’s approach to saying there is one and only one way to be engaged in the program that the airline values. A Delta Diamond without a Delta American Express card pays more for award travel.

Plenty Of High Value SkyMiles Members Don’t Have The Card

There are numerous reasons why someone would be engaged as a high value customer without also being an American Express customer. For instsance,

  • Maybe they’re new to the country and haven’t established credit here yet.
  • Or they had the card years in the past, decided it was low value, and didn’t keep it. American Express is offering everyone else big miles to take the card, but not them. That’s frustrating.
  • They have credit issues, maybe from identity fraud that they’re working through slowly. Or medical billing issues.
  • They had a past frustration with American Express, deciding that the company’s customer service isn’t what it once was, and they swore off doing business.

A Thumb In The Eye Of Loyal Flyers

Delta no longer values Diamond members on their own. When it comes to award redemption, they value a non-elite member of the program who takes an Amex card and doesn’t use it. Delta customers, including top SkyMiles elites, pay a non-Amex customer surcharge every time they use their miles.

Does It Make Sense To Capitulate?

For a year it absolutely makes sense to get the card, the upfront bonus alone is clearly worth more than the annual fee while there are elevated offers (as there are now).

But does it make sense to keep a card on an ongoing basis? If you’re a Delta flyer, the Reserve card makes sense to access Sky Clubs (especially since Delta is doing something about crowding, and the card is clearly the best way to access clubs from a cost perspective, and by not being excluded on basic economy fares). Companion tickets can cover the cost of the Platinum and Reserve cards as well.

From a pure redemption discount standpoint, let’s compare a $99 annual fee card – at a value of 1 cent per mile you’d need to save 9900 miles per year if you do not value other features of the card. That means you need to redeem awards that would otherwise cost 66,000 SkyMiles to net 9900 miles of savings each year with TakeOff 15. With SkyMiles that is not hard to do.

As distasteful as I find the approach, if you’re going to fly Delta and you’re able to get an American Express co-brand, it likely makes sense to do so for many. Just be glad there are elevated offers.

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. It already made sense for the free checked bags, so no more analysis needed for us. Also signing up for Gold Delta comes with enough miles to pay for years of the annual fee even if you don’t value the free bags.

  2. @ Gary — It ALWAYS makes sense to take the SUB and then close the card the next year. They screw you. You fight back.

  3. The 15% back doesn’t do anything to move the needle for me. Getting 15% off a one way business class flight from ATL to ICN on a Tuesday in October is still going to cost a hell of a lot of points…348.5k to be exact.

    To get me even remotely interested in any of their cards past the sub would require at least 50% off…and that’s if they don’t jack the cost up to compensate.

    Delta has a decent product. I fly with them when it makes sense and have accepted that “it is what it is” when it comes to their loyalty program.

  4. This is why my family members recently got the 30k bonus for the United Gateway card, which has no annual fee. It provides access to XN award inventory just like the $95 Explorer card.

  5. If you live in a Delta hub, the card is already a no-brainer. At MSP, for example, something like 75% of flights are Delta. The platinum card’s annual companion certificate is generally a net money maker in itself. Add on checked bags and now 15% off reward travel and it’s worth keeping. The only spend we put on it is hotels and Delta airfare at 3x as well as 20% off on board booze. Otherwise it lives in the drawer and quietly does it’s job.

  6. Done with Skypesos. Dumping their Amex cards. Will only take SUBs sans annual fee, use them before they’re even more worthless, and then dump again. I am going to make them pay me.
    They have destroyed any value.

  7. The simple answer to Gary’s question is “NO” ‘

    The travelers that Delta seeks and its moves support are to get high value business passengers – largely through negotiated agreements and in markets where Delta commands a service premium – such that Skymiles is not the driving factor.
    All of the people that respond to questions about walking away from DL do so based on their individual decisions.
    The largest amount of travel is not on an individual, unnegotiated basis.
    Delta carries the largest amount of business travel among US airlines among US airlines

    Those who buy from a DL and use Skymiles as a make or break purchase factor probably do not want to choose DL – but that is simply not the demographic that Delta is chasing.

  8. I disagree with Tim here. Delta doesn’t just seek out high value business passengers that fly on negotiated contracts. They also seek out individual travelers that choose Delta for whatever reason, perceived or not – better service, better routes, better planes, more reliable service, better SkyClubs, etc.

    I agree that SkyMiles is not the motivating factor. But Delta elites burn a lot of Skymiles, often on domestic travel. Delta has made a lot of changes to make SkyMiles more valuable to travelers in recent years:
    1) Making award travel eligible to earn MQM and MQD
    2) This change, which is targeted to credit card holders

    This makes Skymiles more valuable to elite travelers in a way Delta prefers.

  9. I personally think this change is horrendous, and another example of Delta demonstrating that SkyMiles and their elite program in general are not a priority and low value. That said, as an American Executive Platinum, it doesn’t really affect me.

    However, one thought I have, which I hope isn’t true, is that this is indicative of loyalty strategies that airlines may increasingly lean on in this post-COVID new normal of permanently diminished business travel.

    The road warrior is the classic example of an elite flyer that doesn’t engage with the program, doesn’t have the credit card, and earns everything from pure flying. Leisure travelers, especially high-end ones, are probably much more likely to have the card and participate in other even more niche engagement channels.

  10. The road warrior may be just a pawn forced to fly on corporate contracts that are heavily discounted and the airlines may just be waking up to the fact.
    The airlines are looking to engage more with leisure travelers and to reward or influence behavior.

    I would have given a varying threshold to nudge more people to the more expensive cards
    – likely that will follow once the economy clearly improves, e.g., Delta Gold Amex – 5% off; Delta Platinum Amex 10% off; Delta Reserve Amex – 15% off

    DL is not unique in MQD for awards -awards on UA earn PQP and PQF as well.
    I agree with many of the comments above, good and bad. Once you set a value of 1c for a mile, then it needs to be rewarded like 1c cash – In a way it is better than cash for airlines – as they get the money for the credit card miles far ahead of the actual travel, so the float time is larger than a year unlike tickets which are not older than 11 months at most

  11. Anthony,
    you are right that my statement is too black and white regarding negotiated travel but they are much less focused on the individual traveler than American or United and they get revenue premiums because of their leading market position in all of their hubs except for SEA where they still have a network advantage over AS.

  12. Not to mentioned good Delta customers and status holder that aren’t US residents and can’t even get the card if they wanted to. Used to be the case for me a few years ago until I switched my travel to and in the US mostly away from Delta.

  13. The bigger reason I switched to to regular AMEX Platinum is that Delta does not allow the points you accumulate on that card to be used for their partner and when I fly internationally we are always flying out of Mexico City on KLM or AirFrance

  14. Let me clarify my previous comment. The award points for flights on the KLM and Air France site are often either not available or better than what is showing on the Delta site. When I previously had a Delta Reserve Amex I could only transfer miles to my Delta account and not to their partner’s accounts.

  15. Gene is 100% correct. For those of us who rarely fly DL we cannot justify paying AF to keep this card. Maybe rotate various card options between P1 and P2 on an annual basis for SUBs and benefits though obviously excluding the Reserve card.

  16. I got the Gold Card 2 years ago because of a special offer, but I canceled it several weeks ago. I don’t hate Delta, but AmEx is terrible. They look for every which way to stick you with fees and interest. Even though I pay off my balance every month, a one time late payment (sent on time but apparently the mail was slow and they have no grace period) has so far cost me hundreds. The reps on the phone are “so sorry, but the system won’t let me remove the charges.” Well it was the company that set up “the system.”

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