RDU Terminal 2

RDU Terminal 2

Sunday, November 22, 2015

Travel Tip - An Analysis of Updates to the American Airlines AAdvantage Program - Miles and Status

Location: Home

American Airlines recently announced changes to the way that their AAdvantage program will work in the second half of 2016. As a frequent flyer on American, I have been worried for a while about this type of change. I wanted to better understand how the changes will affect me, so I ran some numbers.

This analysis will focus on earned miles and status.  Later on I may write another analysis based on changes to awards travel.

Summary of Impact on Me

The impact on me is somewhat negative, but not too bad. Here is my projection of the impact based on a full year of the new rules.
  • Qualification for Elite Status: no change
  • Systemwide Upgrades: loss of 2-4
  • Awards Miles Earned: 22% less

My Travel Profile

The changes will affect different travelers in different ways, so it would be good to understand my travel profile.
  • Consistent  (2012-2016) Executive Platinum (EP) traveler.
  • My trips are typically planned in advance, so my tickets are usually discounted.
  • I do not buy First or Business Class tickets.  I occasionally buy premium coach for international flights on carriers that have that option.
 2015 Specifics:
  • 30 itineraries booked
    • Carrier: 
      • 25 booked on AA, which includes US Airways and code share flights
      • 5 booked on OneWorld partners
    • Region:
      • 17 domestic
      • 13 international
  • 87 segments
  • 150,000 Elite Qualifying Miles (EQMs) earned
  • 1730 miles/segment average 
  • 389,863 total award miles earned 
  • 304,588 award miles earned from flights only (excluding hotels, misc. bonuses, etc.)

Elite Qualification

I tend to fly relatively long segments, so I qualify on miles rather than segments or the now disappearing points.

Net change for me: None.

Systemwide Upgrades

One of the big benefits of qualifying for EP status is the 8 systemwide upgrades granted per year. These are good for all the segments of one part of a journey, including international flights.  They can also be used for others, so they are very valuable.

In the new plan, EPs will earn 4 systemwide upgrades at the 100,000 EQM level, with the opportunity to earn 2 more at the 150,000 EQM level and a final 2 more at 200,000 EQMs.

In 2015 I will earn 150,000 EQMs, which means a total of 6 systemwide upgrades.

In 2012-2014 I earned 101,000 to 129,000 EQMs, which would be 4 systemwide upgrades.

Net change for me: Loss of 2 to 4 systemwide upgrades

Award Miles

This is the area of biggest change.  In the past EPs earned awards miles equal to the twice the actual distance traveled. AA is now moving to a plan where the award miles earned depend on the amount paid for the ticket.  At the EP level this amounts to 11 miles per dollar spent.

Here are some examples of the current rules versus the new rules.

Itinerary  2015 Rules 2016 Rules Notes
  • 1,062 miles each way
  • 2,124 total miles
  • 2,124 bonus miles
  • 4,248 award miles
  • $432.20 total
  • $56.38 taxes
  • $375.82 fare
  • 4,134 award miles

  • 5,047 total miles
  • 5,047 bonus miles
  • 10,094 award miles
  • $437.20 total
  • $72.55 taxes
  • $364.65 fare
  • 4,011 award miles
Reduction of
miles in 2016

  • 3,872 miles each way
  • 7,744 total miles
  • 7,744 bonus miles
  • 15,488 award miles
  • $1976.00 total
  • $693.00 taxes and fees
  • $1679.60 fare+fees (est.)
  • 18,476 award miles
Increase of
miles in 2016

I wanted to get a better view of the total effect of the changes over the course of a year.  I did an analysis based on my 2015 travel and spending.  The monthly breakdown is shown in the table below.

  • The award miles earned in 2016 will be based on spending for airfare and carrier-imposed fees. It does not include taxes. This makes the calculation tricky because AA does not always break out the taxes separately, especially for international travel. Based on some quick research, I used 15% as an estimate of the taxes for where the taxes were not specified. Note that this figure has a big impact on earned miles.
  • AA has not yet specified the formula for award miles on OneWorld partner airlines.  For this analysis I used the same formula as for flights on AA.

       Month     2015
February 24,079 13,423  Long discount flights will earn a lot less miles
March 40,899 36,961
April 2,000 0  I assigned the award miles for the initial flight
May 36,182 23,266
June 32,778 36,961
July 10,180 11,432
August 15,512 13,151
September 13,988 10,082
October 8,726 3,551
November 51,886 48,672  Long international flights on Cathay and BA in premium coach
December 47,324 13,903  Long international discount flights on AA
January 21,034 24,927
Total 304,588 236,273  68,315 fewer award miles or 22% less in 2016

Net change for me: 68,315 fewer award miles, or a 22% reduction

Note that February, May and December accounted for 80% of the awards mileage reduction. These months included long trips bought at a low fare.

Closing Thoughts

AA says that the changes are aimed at "giving our best customers access to our most exclusive benefits." Anybody who buys business or first class tickets falls into that category, and they will see big benefits.  As a very frugal traveler I will see some reduction in awards miles and systemwide upgrades.  Even so, I think that the AAdvantage program will remain beneficial for me overall.

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