Rewards, Travel

Single-airline cards losing their luster

Kelly Dilworth

Airlines continuing to revamp their frequent flier programs by cutting benefits and restructuring rewards programs and it’s causing some airline credit card holders to question whether it’s worth staying loyal to one carrier.

“Not only are free upgrades harder to find, but airlines have increased the number of miles (or points on some airlines) needed to obtain award seats,” wrote founder George Hobica in a Nov. 29 op-ed in USA Today. “Plus they’re awarding fewer miles for flights, and they’ve added fees and surcharges to what were originally truly free awards.” In an unscientific survey of its readers, the site asked whether loyalty still pays. Eighty percent of the 1,500 respondents answered no.

Over the past year, a number of major airline carriers, including United, American and Delta, have retooled their miles programs so that cardholders earn points based on how much they paid per ticket rather than how far they flew. Changing rewards from miles-based to a price-based system made loyalty programs far less valuable for everyday travelers and bargain hunters. As for frequent fliers, those who have single-airline loyalty cards are already bound to just one airline and, as a result, often have to give up cheaper flights on other carriers just so they can earn maximum rewards and gain or maintain elite status. According to the consulting firm IdeaWorks, the frequent flier programs run through budget airlines such as Southwest have turned out to be much better deals than the frequent flier programs offered by bigger carriers, thanks in part to cheaper rewards flights.

In addition, air travel experts complain that airlines have made it tougher to use points for instant seat upgrades – a popular perk for frequent travelers who booked economy fares but hunger for free upgrades to business or first class. “Upgrades are harder to find these days because airlines have slashed first and business class domestic fares, enticing more people to buy them rather than play upgrade roulette,” wrote Hobica. Some airlines have also tweaked how they award free travel upgrades. For example, American has announced loyalty program changes for 2017, which most frequent fliers have panned as further watering down of rewards.

Airlines have also slashed the value of rewards points, forcing loyalty members to earn more points to pay for a free flight, and have tightened their redemption rules. For example, United made changes effective in October 2016, including Chase Sapphire cards, Capital One Venture or the Barclaycard Arrival Plus World Elite Mastercard, typically give cardholders more opportunities for earning points. For example, a number of travel cards offer bonus points on groceries, gas and restaurant purchases as well as on travel purchases, making it easier for less frequent travelers to rack up points.

They also typically offer more flexible redemption policies, potentially saving cardholders a substantial number of points on rewards-funded flights. For example, some travel cards let users book the cheapest flight they can find themselves and get reimbursed for it. Other issuers handle flight bookings, but don’t impose any restrictions or travel blackout dates.

If you’re thinking about applying for a new travel card, think seriously about what you want from a travel card before you apply. If you live near an airline’s hub, or you’re fond of a particular airline and its perks, an airline card might still make sense. But if you care more about scoring cheaper fares and traveling on your own terms, then a general travel card could be a much better fit.

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