American Cuts Change Fees, Improves Basic Economy, Beats United

Filed Under: American

My goodness, this has possibly been the best 24 hours for US air travel consumers in decades. Yesterday evening United eliminated change fees on domestic tickets, then Delta eliminated change fees on domestic tickets, and now American is eliminating change fees on domestic tickets (and then Alaska Airlines and Hawaiian Airlines eliminated change fees as well).

However, American’s policy is even more generous than United’s, so that’s fantastic.

Let’s get into the details.

American Airlines cuts change fees

American Airlines is eliminating change fees on many itineraries effective immediately:

  • This applies for domestic and short haul international itineraries (this includes Puerto Rico, the US Virgin Islands, Canada, Mexico, and the Caribbean)
  • This applies to First Class, Business Class, Premium Economy, and Main Cabin fares, as well as AAdvantage award travel (this has now been extended to AAdvantage awards globally); the only exception is Basic Economy fares
  • American will allow customers to keep the full value of the original tickets they purchased if they need to rebook; in other words, if you cancel a $500 flight and rebook a $300 flight, you’ll still have a $200 voucher

This is so great that I’m in disbelief, and frankly this destroys United’s policy (in a positive way). Not only are select international destinations included (unlike with United), but most importantly you get the residual value of your ticket if you rebook on a cheaper flight.

With United if you canceled a $1,000 itinerary and rebooked a $500 itinerary, you would forfeit the difference. That’s a huge “gotcha” that you don’t have to worry about at American.

It’s interesting to note that unlike Delta and United, American isn’t using the word “permanent” to describe these changes, which I respect.

American is eliminating change fees on many kinds of tickets

American Airlines introduces free standby

As of October 1, 2020, American Airlines will be introducing free standby for all travelers, eliminating the $75 fee that currently exists for non-elite members:

  • You must standby on the same day as the original departure date, and be traveling to the same destination
  • This applies to eligible domestic and international travel, regardless of the ticket purchased

American Airlines is introducing free standby

American Airlines extends temporary change fee waiver

While American is eliminating change fees on domestic and short haul international tickets long term, the airline is extending its temporary change fee waiver for other tickets.

American is extending its change fee waiver for any new travel purchased by December 31, 2020, which would even apply for Basic Economy and long haul international flights.

American Airlines has a temporary change fee waiver for all flights

American Airlines changes Basic Economy for AAdvantage elite members

Some AAdvantage elite members may find this to be the most exciting development. As of later this fall, AAdvantage elite members will receive all elite benefits when booking Basic Economy fares. This includes upgrade privileges, the ability to assign seats (including Main Cabin Extra), same day confirmed flight changes, and more.

There’s one catch — as of January 1, 2021, Basic Economy tickets will no longer earn elite qualifying miles (EQMs), elite qualifying segments (EQSs), or elite qualifying dollars (EQDs) towards future status. Previously Basic Economy earned elite qualification at half the rate of “regular” economy.

While the lack of elite qualification is a negative development, personally I view this as an overwhelmingly positive change. As an elite member I’ve avoided Basic Economy fares on American due to the lack of benefits.

I’ll gladly give up 50% elite qualifying miles in exchange for my usual elite perks.

American Airlines Basic Economy tickets are now upgrade eligible

American Airlines Basic Economy gets more flexible

American Airlines is making Basic Economy more flexible for non-elite travelers as well. As of October 1, 2020, customers who purchase Basic Economy tickets will be able to purchase upgrades and priority boarding, and can even pay for same-day confirmed flight changes.

This makes Basic Economy more a la carte than in the past.

American Airlines Basic Economy will come with more flexibility

Bottom line

I’m in disbelief that in the past 24 hours all of the “big three” US carriers have eliminated change fees on many itineraries. While the current state of the industry is awful, these are the most consumer-friendly airline changes we’ve seen in a long time. For that matter, this eliminates a huge competitive advantage of Southwest, which has long advertised no change fees.

I’m frankly surprised that American’s changes are the most overwhelmingly positive. Not only do short haul international destinations qualify for the change fee waiver, but you also get to keep the residual value of any voucher, if you rebook onto a cheaper flight.

And then there are the changes to Basic Economy, which I’m a big fan of.

What do you make of these American Airlines changes?

Comments
  1. Great and exciting news overall!

    Slight typo in your article though: one of the headers says American Airlines changes premium economy – guess you mean basic economy.

  2. Nice job by the OMAT team providing readers exceptional analysis on these changes. Doing this so quickly and completely is really something to be proud of.

    I sense the fingers of one Tiffany Funk behind the scenes! Thank you Tiffany

  3. @ Clem — Fixed, thank you! Sorry, might be publishing a bit prematurely today with all the news and not taking the time to proofread until after publishing. 🙂

  4. My fear is that there will be a much bigger cost difference between Basic Economy and “regular” Economy fares.

  5. This is all excellent news. Any info about change/redeposit fees for award tickets?

    Also, with all this good news… how about another happy hour?

  6. @ Elteetrav — We’ll do another one soon, let me figure that out, thanks for the interest. 🙂 I believe this won’t apply to awards, so let me add a section about that to the post.

  7. Let’s hope they also revert to better frequent flyer programs (with more availability) and better elite status benefits where, say, a systemwide upgrade might actually be usable. Here’s hoping they bring back RTW AAdvantage mile only tickets (will be tougher without LATAM, though).

  8. Now if only hotels would get rid of resort fees (especially when many of the amenities are closed or reduced in benefits).

  9. It should really say improves basic economy (for elite members), because as someone who always flies whoever is cheapest the basic economy changes actually leave me worse off.

  10. @Rico. Yep, last day to book flexible travel on Alaska Air is Sept 8. Sticking out like a sore thumb at this point.

  11. Yep, Southwest is the huge loser today.

    The primary reason I book Southwest has just disappeared.

  12. Great news overall!

    I’m not that concerned with the business of no residual value on UA. Lets say I buy a $500 ticket and then want to change it to a $100 ticket. I’ll just cancel the $500 ticket, buy the $100 ticket on my credit card, and only use the $500 credit when I’m buying a ticket thats $500 or >. This impacts non frequent flyers a lot more! However, if you fly a lot you are always buying tickets and you can strategically use these credits when it makes sense. AA’s policy is better, but I can easily manage this process on UA without any worry to be personally. However, I’m far from a normal traveler!

  13. Ben, AA’s press release indicates award travel IS covered by the new policy….can you clarify for us?

    “The new change fee policy applies to AAdvantage® award tickets as well.”

  14. The details are not good for award travel. Only applies to US/CA/MX/PR/USVI – for award trips to the rest of the world, you get bupkiss. And, the fee-waiver is time limited. AND you do not get to redeposit your miles for no fee – you must USE THEM by 12/31/2021. If you want to cancel an award trip and redeposit the miles, you pay fee.

    United’s new policy is vastly better for award tickets.

  15. If I book a ticket for April 2021 and need to cancel it, for how long will that residual value remain available? Only until a year from booking (i.e., 8/31/21) or some other time, or is it not clear at this point? Thanks!

  16. Kelly must be on the phone with Kirby as we speak…”LOOK AT WHAT YOU’VE DONE!!!”

    Bravo AA for (finally) some one-upmanship!

  17. Rebooking fees were the genesis of all fees, aren’t they? When United’s Scott Kirby termed this move as “permanent” thought “permanent until the economy is better”. How will Southwest react to this immediate loss of competitive advantage they have touted for decades?

  18. This is pretty cool news. I’m hoping the next big thing is more saver/discount award availability in the 3 alliances.

  19. Also forgot to mention that the residual value voucher for fare difference is a huge thing, at least for my current travel issues. I’ve been burned this one a few times in the past and it’s painful.

  20. I’m confused about the same day standby. Is this scenario if I miss an early flight and try to stand by on a later one?

  21. Ben, do you know if the positive changes regarding elite benefits also apply for customers with OneWorld status other than AAdvantage (e.g. BA Sapphire?)

  22. I think this just shows you the level of competition there is right now for travelers during a pandemic. Delta and AA couldn’t even wait two days to make the change. It’s match or potentially lose higher share of customers Just due to the limited volume.

  23. Shared with an aviation friend in Australia.

    AA and all international airlines apparently still capped at 30 pax per each arrival.

    Cargo once again carries the day…errr, weight.

    In my memories of being in the biz, I’ll never forget that LHR-HKG still operated profitably on cargo alone during the darkest days of SARS.

  24. What counts as “same destination” for free standby? If I’m flying to LGA, will AA charge for flying standby to JFK or EWR?

  25. If you only buy Basic Economy – then with no EQM or EQS – how are you going to earn Elite status? Doesn’t sound that appealing to me.

  26. Hey Lucky this might be interesting to you but ANA just recently moved their training center to Haneda airport and the old location looks to be a good spot for a hotel to take over!

  27. What do you need before you can enjoy your “usual elite perks”? Elite status, of course. So if you are no longer earning ANY elite qualifying miles with Basic Economy, how are you going to obtain that status required for your perks? Even the 50% reduction in EQM was an unadvertised and painful post-purchase find causing me to just miss getting the elite status. Honestly, paying the extra $35 for full economy to get ALL those EQM points is well worth it, at least until you’ve achieved that status.

  28. @DCYukon you cannot fault the airlines for lack of award availability solely. Pre-C19 air travel was a frenetic high with so many paying passengers. Revenue customers always trump award tickets. But maybe now for a relatively short period award travel will be easier and more advantageous.

  29. @ TedH — I think the intent is that elite travelers would book some Basic Economy fares and some non-Basic Economy fares. I agree when “regular” economy is $35 more it has been a no brainer, but I’ve also seen situations where Basic Economy is $35, and regular economy is $200+, so sometimes the difference is substantial.

  30. @ Randy — If you’re only buying Basic Economy then you probably wouldn’t be bothering going for elite status as it is?

  31. @ MPSinCharlotte — Generally American doesn’t allow co-terminal standby, as far as I know, so I think you’d need to travel to exactly the same airport.

  32. I’m in disbelief that in the past 24 hours all of the “big three” US carriers have eliminated change fees on many itineraries.

    Desperate times call for desperate measures, as the steady march toward the return of the ‘Golden Age’ of loyalty continues…

  33. On AA I guess the BE fares would make sense for me as I’ve already hit EXP for the year and wouldn’t need additional EQDs/EQMs.

    Two questions:
    Will BE fares still be applied towards 12 month rolling spend for upgrade priority within status level?
    Would the miles from BE fares still be applied towards MM status?

    Admittedly neither of these are “game changers” if there’s a significant difference in fare. And why do I think the difference might be minimal.

  34. Alaska following suit has me very interested in moving points to them for some travel next year to Japan (hopefully).

  35. great news ! delta is my preferred carrier, but applaud AA for making changes to basic economy. hope other 2 follow suit.

  36. @ Ben — AA’s website also says no EQD earning for B fares effective January 1, 2021. You only mention EQMs and EQSs above. Not crediting EQDs is flat out stupid, but that seems to be the policy, no?

  37. @ Highgamma – jealous. That is so hard to earn for most people who are not located in AK. 🙂 Have fun!

  38. just to confirm, do web specials fall under the general fee waiver for all bookings up until Dec 31 of this year? i’m looking to book for next july.

    meaning, if i cancel the web special later and reinstate my miles, do i have to pay a fee or that is waived for all new bookings till end of year?

    thanks!

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