Is the traditional airline loyalty reward chart — showing fixed mileage costs for various award trips — becoming a thing of the past? Industry observers are predicting that other airlines are likely to follow the lead of Southwest and Delta in changing over to “dynamic pricing” for award trips — i.e., varying the miles or points required based on supply and demand, just as they do with air fares.
It’s just one more blow to the traditional structure of airline mileage programs that the hapless traveler will have to adjust to, as burgeoning load factors give airlines increasing confidence to do pretty much whatever they want with program rules. It’s also helped along by the fact that reward travel requests have been increasing in recent years as capacity remains tight.
The trend to dynamic pricing for award seats is perhaps a natural outgrowth of frequent flyer programs’ ongoing shift from distance-based to spending-based earning models, now in place at Southwest, Delta and United, and perhaps coming to American as well.
Bloomberg News, in an analysis of the trend, predicts that United will begin dynamic pricing for MileagePlus award travel in the second quarter of this year, although the airline wouldn’t confirm it.
Bloomberg also noted that Southwest Airlines, which sets a fixed exchange rate between Rapid Rewards points per dollar of air fare (which is set dynamically and thus varies by award flight) last month boosted that rate from 70 to 80 points per dollar.
The quandary for passengers was perhaps best symbolized by Delta’s decision last year to remove its award chart from the SkyMiles website, so the cost of a reward trip was completely unknown until the traveler researched travel dates and routes.
Given that uncertainty, it’s all the more reason to keep your reward travel plans flexible in the future. And to keep burning your miles as fast as you earn them, since they continually lose value over time.
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