The value of loyalty is on the decline if you are an airline passenger.
When United Airlines and Delta Air Lines announced plans recently to overhaul their loyalty rewards programs, industry experts assumed the changes would benefit airlines at the expense of passengers.
Now a new study calculates exactly how much fliers will lose.
Both airlines announced plans to switch from a loyalty rewards program that awards miles based on total distance flown to programs that dole out miles based on how much travelers spend on airfare.
Members of United’s MileagePlus program will collect an average of 11 percent fewer reward miles, flying on the most popular routes, under changes that take effect March 1, according to a study by Boston flight research site Hopper.com.
Meanwhile, members of Delta’s SkyMiles program will get an average of 22 percent fewer miles under changes starting Jan. 1, the study said.
“Overall, typical fliers earn fewer miles on both systems,” said Hopper’s chief data scientist, Patrick Surry.
The effect on individual fliers will vary, depending on the loyalty tier of the traveler and the fares they pay.
Among major air carriers, only American Airlines continues to offer a distance-based loyalty system. Brian Kelly, a loyalty rewards expert and founder of the website ThePointsGuy.com, said American may leave its program unchanged to differentiate itself from competitors.
“I don’t think it’s a slam dunk that American will follow,” he said.
Norwegian chief defends plans to launch low-cost airline
Norwegian Air Shuttle’s plan to launch the biggest low-cost airline crossing the Atlantic took another hit last week when former Transportation Secretary Ray LaHood said the federal government should withhold a permit for the carrier, pending further studies.
The carrier, based in Norway, is awaiting approval from the U.S. for permission to fly into the country from a base in Ireland.
Airlines and labor unions charge that Norwegian – Europe’s third-largest low-cost carrier – is opening a base in Ireland to take advantage of more lenient labor laws, with plans to undercut transatlantic fares charged by other carriers.
“We should not rush approval of the new business model until the consequences for international competition and the impact on airlines, their workers, and consumers are fully understood,” LaHood said in an article that appeared on the news site TheHill.com.
Norwegian’s chief executive, Bjorn Kjos, said his intentions are misunderstood.
In a recent interview, Kjos said his airline already has permission to fly into the U.S. under the “open skies” agreement between the U.S. and Europe. The move to Ireland, he said, would make it easier to fly to destinations in Africa, Asia and South America and give his airline access to better financing to buy planes.
The salaries of crew members flying from Ireland are nearly the same as those for U.S.-based crews, Kjos said.
So why are unions and competing airlines so intent on stopping Norwegian?
“They have a protected environment for high prices,” he said. “They hate that we will have introductory fares for $99.”
Delta Air Lines loses bid to call itself ‘most trusted airline’
It looks like Delta Air Lines won’t be calling itself the “world’s most trusted airline.”
The U.S. Patent and Trademark Office rejected the airline’s request to trademark the slogan, saying it is “not inherently distinctive, but rather is merely laudatory and descriptive.”
The airline has six months to appeal.
Don’t feel sorry for Delta. The airline can always revisit one of 22 other trademarks and slogans it has adopted since the 1920s, including “The airline with the big jets” (1959), “We love to fly and it shows” (1987), “Ready when you are” (1992) and the latest, “Keep climbing.”