Star Alliance Introducing New Credit Card, Adding Non-Airline Partner

by Gary Leff

Star Alliance, the largest of the three international partnership groups which includes United and Air Canada, plans to launch a credit card that’s separate from the co-brand cards issued by its individual member airlines. It’s expected to become available later this year. (HT: @crucker)

It’s not clear who will issue the card, or how points-earning will work since Star Alliance doesn’t have its own currency separate from those of its members. And having miles with member airlines already allows customers to redeem their points across the alliance.

There’s no way Star Alliance outcompetes a given airline in its own market. United won’t allow Star Alliance to offer consumers a better cobrand value proposition than MileagePlus in the U.S., nor is Star likely in a position to do so.

Star Alliance will also add a non-airline partner, suggesting it could be a European railroad. Star Alliance wouldn’t be first to try building in a non-airline travel company, SkyTeam announced Hertz as a car rental member in 2018 the idea here was that Hertz would pay to attract customers in the alliance.

Finally, Star Alliance wants to make bulk purchases of sustainable fuel as a group on behalf of its members and “partner with large multinational corporations” in travel to “get businesses to subsidize airlines’ cost” because airlines are always looking for subsidies.

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’s not clear . . . how points-earning will work since Star Alliance doesn’t have its own currency separate from those of its members. And having miles with member airlines already allows customers to redeem their points across the alliance.

    1. Bilt accrues its own points that don’t have cash value but transfer to airlines. Presumably, Star Alliance will devise a similar “currency.”

    2. If the Star Alliance card can transfer to any member airline, then the points are much more valuable for topping off mileage balances.

    United won’t allow Star Alliance to offer consumers a better cobrand value proposition than MileagePlus in the U.S., nor is Star likely in a position to do so.

    Much of the value prop in UA cards is not points, but free checked bags and other things that a more savvy traveler (a.k.a. one interested in an airline alliance card) would care less about. The UA card’s point accrual rate is lame. Even if the Star Alliance card offers no benefits other than a flat 1.5x point per dollar accrual rate, then in my book, it’s got the UA cards beat.

  3. My guess is you can cash the pts for a voucher that is accepted towards flights across star alliance. Perhaps, earn at 1c and allow star redemption at 1.5c, with burn at 1c for anything else.

    Anything else seems too complicated, and likely to be opposed by the airlines/banks.

  4. Imagine if it were to also earn status points as some cards do. Holy smokes.

  5. Similar to ayenus’ point, it suggests to me that maybe S* is moving towards one unified FF currency? Alliance-wide standardization would be very interesting from a carrier/alliance point of view, and maybe very damaging from a consumer point of view.

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