It has been announced that American Express and Air Canada will be renewing their partnership for a further 10 years, which should be good news.
This 10 year deal is expected to drive continuity for joint customers, and will allow the companies to deepen and expand their partnership.
Keep in mind that there’s quite a backstory to all of this, given the recent happenings with Air Canada and Aeroplan.
Air Canada’s acquisition of Aeroplan
In May 2017 it was initially revealed that Air Canada would be dumping Aeroplan as their loyalty program. Over a decade ago Air Canada spun off their loyalty program to raise cash, and Aimia (Aeroplan’s parent company) has run the program ever since.
The news was that in 2020 their contract ended and Air Canada didn’t intend to renew it. Simply put, Air Canada thought they could make more money and offer a better experience by operating their program directly, rather than having it spun off.
Last summer Air Canada announced their interest in acquiring Aeroplan, the same program they just announced they’d end their relationship with. There ended up being quite a bit of negotiating on price, but in the end Air Canada and Aimia reached an agreement in August 2018.
What this expanded partnership means
We’re just over a year from Air Canada launching their new loyalty program. It’s anyone’s guess what the new program will look like, or for that matter how much it will change, given that Aeroplan is staying in the picture.
With today’s announcement, we know that:
- American Express and Air Canada will create new co-branded payment cards (presumably in Canada, but who knows, maybe we’ll see US cards introduced as well at some point)
- Air Canada’s new loyalty program will continue to participate in the Amex Membership Rewards program in the US and Canada, which I’d consider to be great news, as this wasn’t previously a sure bet (there are lots of Canadian credit cards earning Aeroplan miles as well)
- There will be expanded commercial cooperation between the two companies, though the full details of that haven’t yet been announced
According to the press release:
The two companies will work more closely in strategic areas such as premium customer experience, digital integration, member analytics, and incremental partnership opportunities. The terms of the deal provide Air Canada with significant revenue benefits and cost improvements, including a one-time payment upon signing, and the partnership will allow American Express to continue to expand its leadership in the premium card landscape.
There are still a lot of questions about what Air Canada’s new loyalty program will look like starting next year.
One thing I know for sure is that Aeroplan is one of my favorite Amex Membership Rewards partners, and I’m very happy to see that Air Canada will stay on as a transfer partner with the new program. Of course I hope that the program maintains a good value proposition, as that impacts whether or not this will continue to represent a good value.