End of runway for world's favourite airline perk as value of BA points plummets
Cost-cutting of regular fares means 'free' loyalty flights can cost more than just buying a ticket
Simon Calder is Travel Editor at Large for The Independent, writing a weekly column, various articles and features as well as filming a weekly video diary. Every Sunday afternoon, Simon presents the UK's only radio travel phone-in programme called The LBC Travel Show with Simon Calder (97.3 FM). He is a regular guest on national TV, often seen on BBC Breakfast, Daybreak, ITV News and Sky News. He is often interviewed on BBC Radio, particularly for BBC Radio 4’s You & Yours programme and BBC Five Live.
Thursday 20 October 2011
First, the glamour, joy and excitement of aviation evaporated. Now the cherished perks of travelling executives, frequent-flyer points, could go too.
On some trips from the UK it now costs more in taxes, fees and charges to get a "free" flight than to buy a ticket on the open market.
Frequent flyers using accumulated miles to fly from London to Amsterdam and back could find the passenger in the next seat with an ordinary ticket has paid £11 less for the same trip.
Business travellers have long grumbled about the diminishing value of free tickets for loyal passengers. Things have now reached a stage at which mileage can have a negative value.
Research by The Independent reveals frequent travellers on Air France/KLM's Flying Blue scheme are charged £110 plus 20,000 miles for a Heathrow-Amsterdam round trip – available for £99 to normal paying passengers.
A KLM spokeswoman said the £110 plus 20,000 miles cost was "available to frequent travellers throughout the year, even at peak time. The £99 offer...is much more restricted in availability".
Meanwhile, for some short-haul trips from Gatwick, BA Miles can be worthless. Members of the British Airways Executive Club seeking a "free" economy flight to Amsterdam and back must pay 9,000 BA Miles plus £77.80 in taxes, fees and charges – the same as the cash fare on many dates this winter.
A member paying half the cost in miles and topping up the rest with cash will spend £45 more than someone buying an ordinary ticket at the lowest price. One reason is a fall in fares. After two decades as the biggest carrier at the Sussex airport, BA ceded its position to easyJet in 2008. The rivals – also the UK's two largest airlines – now compete on a wide range of routes.
To win back business from easyJet, BA has just cut its prices for European flights from Gatwick.
BA said: "Tickets available for Executive Club members to use in return for their miles differ to the lowest published fares in that they are fully flexible, allowing customers to make changes to bookings free of charge."
KLM and BA run sophisticated "yield management" systems aimed at filling planes and maximising earnings.
Seats sold publicly at the lowest fares must typically be bought well in advance, with limited availability on peak departures. The KLM spokeswoman said: "The majority of our passengers burn their miles on long-haul flights or when they need to fly at peak times."
She rejected the suggestion Flying Blue members should be warned cheaper fares might be publicly available and insisted: "Frequent travellers receive regular communication... [and] are aware promotional offers can at times be more competitive."
Many members of BA's Executive Club redeem points for Club World or First Class long-haul flights as that is where BA Miles are most valuable.
British Airways also owns Airmiles, a retail-reward programme that currently offers completely free flights. Amid much controversy, the scheme switches next month to a new currency, Avios, and starts imposing taxes, fees and charges. Previously free flights to New York will soon cost over £300 in addition to points spent.
Timeline: Loyalty in the skies
1981 American Airlines launches "Aadvantage", the first miles-for-free-flights scheme.
1988 Airmiles, a "retail reward scheme" offering free flights is introduced by British Airways.
1990 Virgin Atlantic launches Virgin Freeway, claiming to be "the UK's first automated frequent-flyer programme".
1991 Pan Am collapses, taking billions of "Worldpass Miles" with it.
1995 Tesco Clubcard launches. Benefits include Airmiles.
1996 easyJet unveils its first and only frequent-flyer offer: passengers paying the top fare between Aberdeen and Luton get a free bottle of whisky, which turned out to be a half-bottle.
1998 FlyerTalk becomes the first online forum for collectors of miles. One popular feature is "Mileage Runs", where travellers make journeys specifically to earn points: see www.bit.ly/MileageRuns.
2003 Redeeming Airmiles for low-cost flights ends when Go is taken over by easyJet.
2007 The Independent reveals distortions in the Airmiles map of Europe: points are worth 16 times more flying to Hungary compared with the Scottish islands.
2009 George Clooney stars in Up in the Air, the film featuring a frequent-flyer who reaches 10 million miles.
October 2011 EasyJet starts giving away free tickets, but only to business passengers whose flights are late.
November 2011 Airmiles and BA Miles to be replaced by a new currency called "Avios".
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