American Airlines to Update AAdvantage to Revenue Based Model


Since last November American Airlines has been making numerous changes to their award program, some for the better and some for worse.  In the latest round of changes, American is switching from a distance based rewards chart to a revenue based system.  A move which is not so great for most AAdvantage members.

What is Changing

In a move consistent with what Delta and United have done in the past few years, American has done away with mileage based earnings on paid flights.  Under the current methodology Gold status earn a 25% bonus on miles flown and Platinum and above earn a 100% bonus on miles.  Under the new system each status level has a multiplier associated with it which is used in conjunction with the dollar amount spent.

StatusPoints per $ SpentBonus
AAdvantage member5
Gold member740% Bonus
Platinum member860% Bonus
Executive Platinum member11120% Bonus

The new earnings chart will take effect as of August 1, 2016

Example:

  1. Main Cabin
    • Under the old system a flight from New York (JFK) to San Francisco (SFO) in the main cabin would earn 5,200 miles on a roundtrip ticket with no status.  Under the new system the same booking will earn 1,900 AAdvantage miles (Base Fare of $380 * 5 = 1,900).  That is a 63% reduction in miles for the exact same route.
  2. Business Class
    • The story is a bit different for business class.  Under the old methodology, a traveler would earn 7,800 miles on a roundtrip premium class ticket to SFO from JFK.  Under the new awards model the same trip will generate 11,175 AAdvantage miles.  A 43% increase in award miles.

It is also important to note that American is also doing away with the minimum mileage guarantee on shuttle flights, which was a great benefit for many road warriors.  However the 500-mile EQM minimum will still be awarded on eligible flights.

As illustrated in the examples above, it is clear that American’s model is doing what it is intended to do, awarding those who deliver them the highest profit margins.  If you are a business traveler who is somewhat price agnostic, the changes will most likely be a positive.  For most others, the change in models will significantly reduced award earning potential.

In our next article we will go through the changes to the elite program.

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