Ridiculous: United MileagePlus Devalues Partner Awards AGAIN

Filed Under: Awards, United

Most travel loyalty programs recognize that this is the time to reward loyal members, rather than devalue program perks. And then there’s United MileagePlus…

United devalues partner awards close to departure

United MileagePlus no longer publishes award charts, meaning there’s no transparency when there are changes to award pricing. Well, it looks like in the past 24 hours or so, United has raised the cost of partner airline award tickets booked within 30 days of departure.

Specifically, the cost of MileagePlus partner award tickets booked within 30 days of departure has been increased by 3,000-4,000 miles one-way.

United has increased the cost of partner award tickets again

For example, a one-way Lufthansa award ticket from Chicago to Frankfurt costs:

  • 33,000 miles in economy class more than 30 days out, 36,000 miles in economy class less than 30 days out
  • 77,000 miles in business class more than 30 days out, 80,500 miles in business class less than 30 days out

A one-way All Nippon Airways award ticket from Chicago to Tokyo costs:

  • 38,500 miles in economy class more than 30 days out, 42,000 miles in economy class less than 30 days out
  • 88,000 miles in business class more than 30 days out, 92,000 miles in business class less than 30 days out

A one-way Ethiopian Airlines award ticket from Newark to Addis Ababa costs:

  • 44,000 miles in economy class more than 30 days out, 48,000 miles in economy class less than 30 days out
  • 88,000 miles in business class more than 30 days out, 92,000 miles in business class less than 30 days out

This is the third partner award devaluation

This is bad enough as is, but what makes this even worse is that this is the third devaluation to partner award tickets in less than a year:

Now we’re essentially seeing both of those policies stacked — not only did United devalue partner award costs by around 10%, but there’s also a higher cost within 30 days of departure.

In other words, a Chicago to Frankfurt MileagePlus business class award ticket on Lufthansa:

  • Used to cost 70,000 miles
  • Then it cost 73,500 within 30 days of travel (as of November 2019)
  • Then it cost 77,000 miles no matter when you booked (as of April 2020)
  • Now it costs 80,500 miles within 30 days of departure

Expect to pay more for Lufthansa award tickets within 30 days of departure

This change is unjustifiable

The way reimbursement for award tickets works between airlines, United is paying the same amount whether you book a partner award ticket close to departure or far in advance.

It’s not that United is passing on some increased cost that’s being incurred. Rather United assumes that people are willing to pay more to fly last minute on award tickets, so the program is seeing what it can get away with by increasing its margins on redemptions.

I understand airlines are in a tough spot, but devaluing the miles of loyal members doesn’t exactly seem like the right approach to take here. Never mind the fact that the program has just been used as leverage for a multi-billion dollar loan…

This is another disappointing change from United MileagePlus

Bottom line

United MileagePlus has devalued partner award redemptions yet again, for the third time in less than a year. This is also the second time that this has happened during the current pandemic.

The price increase doesn’t reflect any increased cost United is incurring, so this is pure greed. This is very disappointing from MileagePlus…

(Tip of the hat to Live and Let’s Fly)

Comments
  1. Vote with your wallet. After the last round of MP devaluations I dumped my chase cards and moved my portfolio to be Amex heavy. If they want to devalue the currency constantly then let them kill their golden goose and explain to their shareholders and creditors how their greed screwed them.

  2. This makes perfect sense. They secured loans for their loyalty programme precisely with the argument they can pretty much devalue as they see fit.

    Redemptions for a programme’s own metal are waaay more profitable than partner redemptions. I’ve recently read an estimate that AAdvantage redemptions on AA incur an incremental cost per redeemed mile as low as $.004. Partner awards can cost almost 3x as much.

  3. A bit off-topic, but I’d be curious to read your thoughts on the recent Aeroflot smuggling case. Apparently, the FBI just busted 10 people for smuggling Apple products, many stolen, to Russia from JFK. The State Department also revoked the visas of over 100 Aeroflot crew.

  4. Earlier this year I used the last of my miles with UA. It’s a real shame because I loved their program for so many years. They truly had an opportunity to make themselves different and standout from the crowd but they decided to screw their loyal customer base. So long MileagePlus! It was good while it last but UA knows no limits to their greed and it’ll catch up to them — it always does

  5. Yes, United will sell you miles, and, or pick your pocket. It is a sucker’s bet. The least worthy place to park your money while expecting them to do the right thing.

  6. Ever since the last devaluation, I’ve been choosing to earn miles with ANA, LifeMiles, or a different Star Alliance airline instead when flying United. This is just another nail in the coffin for a mileage program that used to be pretty decent.

    Also, another slight devaluation for Chase UR as well. Chase really needs to add a good transfer partner to replace the Korean Air loss a while back.

  7. I second the sentiment expressed in other comments. I have not had any United credit card for several years now. For that matter, nor do I have any AA credit card. Why bother? I now collect Chase UR points only.

  8. They are simply applying value-based pricing. You seem to expect that they would use cost based pricing? Within reason nobody does that.

  9. I moved out of the chase ecosystem entirely (except woh card) because of this. I’m all in on Citi and Amex.

    At some point, customers notice. It doesn’t matter how many hundreds of thousands of sign up points they give you. Once we know it’s the Zimbabwe dollar, the game is over.

  10. Glad my loyalty is to Delta. I don’t follow awards charts/redemption costs religiously but Delta for the most part has always had fair redemption rates in my opinion. Plus they treat me well and get me to my destination on time. And even though it’s not much I love priority boarding that comes with my Delta Amex Gold card.

    Southwest is my other airline. Have had some hiccups with them here and there but they’re a solid backup to Delta in my situation with my Priority Card ($149/year) that comes with the $75 annual credit (basically making the AF only $74 plus 7,500 RR points every anniversary.

  11. Thank goodness they are a chase transfer partner. I accrue no MileagePlus miles with the program, and just transfer what I need, when needed, which isn’t often. Worthless program.

  12. Nothing compared to the huge devaluation coming for Aeroplan. My credit card gets 1.5 miles per $ spent. That goes to 1:1 Novemer 3rd AND the miles required for a few destinations goes up, notaly NA to Europe. A ticket will be 140k points rather than 110k. It takes me 73k of spending to get a business ticket to Europe now, it will require 140k after novemer 3rd….that’s double!

  13. Unreserved miles are a huge liability on the balance sheet, so most companies actively try to reduce it by whatever means possible. Since all the airlines are busy raising cash by selling miles to their partners or using the loyalty program itself as collateral it makes perfect sense to increase redemption costs so the liability goes down. If the program is not aspirational then you will end up with a transactional program aka a cash back model, which is where the big 3 are gradually headed with revenue based redemptions. At that point in time you are better off putting your spend on a cash back card.

  14. @ Cabal2222 – agreed. I feel for the bloggers. When we go fully cash-back, it will be the end of a significant revenue stream for them. United is hastening the end.

  15. It wouldn’t bother me if they would make additional inventory available within 30 days at the higher price, but I’d be shocked if they’re going to do that. It’s just raising the cost on the same paucity of seats.

  16. @Cabal2222

    I disagree. While the issued/outstanding miles on UA’s balance sheet are shown on the liability side of the balance sheet, a decent chunk of them–sometimes well over 50%–actually represent deferred income.
    For instance, UA sells miles to financial institutions at a value considerably higher than the incremental cost of honoring a redemption. Only when the miles are redeemed (or they expire/are forfeited) UA actually reports a profit. [This is not true for all but most of the miles issued.]

    If UA nudges people towards redeeming for UA as opposed to partner flights, the expected costs of redemptions fall. When the miles are redeemed for awards, UA can then report a higher profit.

  17. I have shifted most of my spending out of the Chase ecosystem because the points have considerably devalued with all of their partners, and they lost Korean which had the best value redemptions. Planning to cancel my Sapphire Reserve when the annual fee comes due.

  18. United wants to make money and they make more when passengers fly on their metal. Ben I suspect you are upset because you are in Germany and this will impact your future trips on Lufthansa. Nevertheless everything is always changing and I’m glad to be Covid free.

  19. I’m sure Ben will forget all about this in a week and will continue singing the praises of United.

  20. Are we surprised? United is the lowest of the lowest. Dirty. I avoid them like the plague even if it means paying a higher fare with another carrier. Don’t care to have to pay more.

  21. Ugh why did I even sign up for the United explorer card last month. Looks like I can barely redeem anything even with the bonus.

  22. I actually noted this implemented last month on my return MUC-SFO … we were changing our return flight booked on LH to push it back two days, and it was an additional collect of 3,500 miles per ticket. I noticed that extending back four days was a straight 77k exchange, but within the 30 day window. Infuriating.

  23. So incredibly infuriating. I honestly, honestly almost switched from AA to UA at the beginning of the year, entirely for the mileage program. That would have been a foolish move, and I’m glad I didn’t. The program is no longer an incentive.

    Also, what a slap in the face at a time when the ONLY possibility for travel is short-term bookings. Anything you book more than a month out is a massive gamble, given the restrictions. What a terrible PR move. I am super annoyed.

  24. Airports that have codeshare rail service such as EWR, FRA, VIE should be easy to navigate as adding a rail segment will give you cheaper mileage levels but except in very limited circumstances one will never have to actually take the train.

    Flying EWR-FRA this week Oct 28 will cost you
    63k on the UA nonstop
    80k on the LH nonstop
    73k on the LH nonstop with a German rail leg to ZWS.

    Since bags don’t get transferred in FRA you just pick them up and leave. None will know you didn’t take the last leg.

  25. If only this was just the biggest thing to worry about. C’mon, folks. I am more bothered by the maskless running around who are delaying all of us getting back to 2019 when chasing a good mileage promo seemed to be the most important topic of the day in the travel world.

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