Who Wins — and Who Loses — With the American-US Airways Mileage Program Integration That’s Just Been Announced?

On net I think the details of how American AAdvantage 2015 plans to combine with US Airways Dividend Miles in the second quarter of 2015 is the best possible outcome we could reasonably have expected.

I did expect that the combined program would have 4 elite tiers (as US Airways has today, and as both Delta and United have as well) and would move to a system of unlimited complimentary upgrades or all members (though I don’t think that system is better for lower tier elites, because it pushes down their success in actually getting upgrades — a system that has them ration when they request upgrades means they are more likely to get upgrades when they do request it).

As far as what could have happened — award chart increases, going revenue-based like United and Delta, imposing minimum revenue requirements for elite status — American didn’t pursue any of those.

Instead they basically kept (at least for now, and for the immediate term!) the American AAdvantage platform that is great for members, and they’re folding US Airways members into that.

Nonetheless, there’s no way to combine different programs in a way that would make everyone happy and better off. Take upgrades: if you like a system that requires using a limited number of earned upgrade instruments then you would be unhappy with unlimited complimentary upgrades (which increases competition for a given upgrade seat). American had the former system, US Airways the latter. So unless they doubled the size of their first class cabins (and gave every member a pony!) any integration becomes bound to disappoint some members.

So I thought I’d outline who gains and who loses given the specific way American will be combining its program with US Airways.

Here’s how legacy American AAdvantage members fare when the programs integrate early next year:

  • American Executive Platinum: It’s status quo for them, but they gain a fee waiver on same-day confirmed flight changes.

  • American Platinum: It’s status quo for them as well, gaining unlimited complimentary domestic upgrades on flights of 500 miles or less.

  • American Gold: While they get unlimited complimentary upgrades on flights of 500 miles or less, they now have to compete with Platinum members every time for upgrades on those flights since neither tier has to use 500 mile upgrade certificates anymore on those flights.

  • American Million Milers: Thrilled that the program stays with 3 tiers — a lifetime Platinum (AAdvantage 2 million miler) remains mid-tier, instead of become “second from the bottom” as happened at United.

  • American General Members: Primarily concerned with value of redeemable miles, the merger puts off major further changes to the award chart. With the introduction of unlimited complimentary upgrades for elites on flights of 500 miles or less, there will be fewer of these flights with empty first class seats — and thus fewer opportunities for a general member to purchase an upgrade at check-in (“Load Factor-Based Upgrades”)..

Here’s how legacy US Airways Dividend Miles members fare when the programs integrate early next year:

  • US Airways Chairmans Preferred:They keep complimentary unlimited upgrades, and get them now on American’s route network. Thrilled that they go from 2 to 8 confirmed international upgrade certificates per year, and in 2015 can even get their normal two plus 8 when the programs combine. These members lose free companion upgrades (those require 500 mile upgrade certificates at American, but top tier American members don’t earn those complimentary). Still, they can use their windfall of confirmed upgrades to help out their companions if they wish.

  • US Airways Platinum members: They’ll be mid-tier in the new program, instead of “second from the top” and they lose unlimited complimentary upgrades on flights over 500 miles. They also lose free same-day confirmed changes. And Platinums who fly 85,000 miles will no longer get the ‘Special Dividend’ choice of upgrades on domestic award tickets. They gain a 100% mileage bonus on flights, up from 75% in the Dividend Miles program. These are the members who probably do the least well with the integration.

  • US Airways Gold members: They’re now mid-tier and not just “second from the bottom.” They get a 100% mileage bonus on flights up from 50% in the Dividend Miles program. They lose free same-day confirmed changes and unlimited complimentary upgrades on flights over 500 miles, but will likely see their upgrade percentage rise when they do request them.

  • US Airways Million Milers: it’s now possible to go beyond lifetime Silver. And crossing new million mile thresholds means more upgrades.

  • US Airways General Members: the only focus here is on value of miles. These members lose the virtually non-existent award rules of Dividend Miles (since those were more or less up to the vagaries of agents) and lose award chart sweet spots like 120,000 miles in first class to Hong Kong — although first class much farther South in Asia is still just 135,000 miles. They trade flexible award routings for one-way awards and recognize that without the merger their award chart would probably have gotten much more expensive. American’s award redemption system also has lower fees

Which category of member do you fall into, what benefit do you care about most, and how do you fare with the changes?

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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  1. I think that there is an easy way to tell if US gold and silver members will be better or worse off with the restricted up grades next year versus unlimited this year. With 2000 mile of upgrade per 10000 flown, your upgrades are limited to an absolute maximum of 20% (probably more like 18% because of the 500 mile increments), so if your current upgrade percentage is higher than this, you lose, if it is lower, you win.

  2. For me, the companion upgrades are huge and a huge loss. A little know quirk to the system is that other non-CP elites on your itinerary gain your status, but don’t count as a companion. So me as a CP traveling with my wife who is a Silver and my daughter who is a general member almost always results in all three of us getting upgraded, often at the 7 day window. My wife inherits my status, and my daughter becomes my companion.

    I’ve long known this is possibly an anomaly that would go away eventually, but it did just go away.

    Upgrades for companions is a huge loss. The quirk of the system that led to my successful upgrades is another huge loss.

    Respectfully, the exuberance of the bloggers with this change was kind of surprising to me. It was almost as high pitched as some affiliate link credit card offer that was about to expire. I think it obvious that most of the bloggers are not US flyers (who would be unless you’re in CLT or PHX) and, thus, nothing changed for them…therefore…’yeah for us!’

  3. Do you know when the 5000 mile discount on UsAir awards will go away when you use your UsAir MasterCard? Will it be by the end of this year or by the second quarter of 2015?

  4. You say: “American Gold: While they get unlimited complimentary upgrades on flights of 500 miles or less, they now have to compete with Platinum members every time for upgrades on those flights since neither tier has to use 500 mile upgrade certificates anymore on those flights.”

    Perhaps it is more apt to say they no longer GET to compete with Plats and Exp Plats for flights less than 500 miles, as Plats and Exp Plats eat from the upgrade carcass first and Plats do not have th eincentive to “hold back” that they have on flights further than 500 miles.

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