Probable Southwest Rapid Rewards Devaluation

Last week, Southwest Airlines sent an email to its Rapid Rewards loyalty program members informing them of a future change in the program. Sadly, they weren’t very specific about the change but it reads as a devaluation.

We created Rapid Rewards® because we think you deserve to actually feel rewarded. And, from time to time we must make some updates to our program. Beginning April 17, 2015, the number of Rapid Rewards Points needed to redeem for certain flights will vary based on destination, time, day of travel, demand, fare class, and other factors.

Previously, Rapid Rewards points basically had a fixed value that were correlated to the cash fare of a flight. However, this cryptic message from Southwest makes it seem like they can charge however many points they want for a given flight on a given day to a given destination.

I really do like Southwest because they have great availability from my home airport (EWR). Another reason Southwest must be considered for is that it is a transfer partner for Chase Ultimate Rewards points. Ultimate Rewards points transfer to Rapid Rewards instantly at a 1:1 ratio.

If you book flights with points, you can cancel them any time before the flight and you will receive the points & taxes/fees back 100%. This is great for making speculative bookings and it’s a feature that other airlines charge big bucks for (often $150+).

When you throw in a Companion Pass, Southwest Airlines Rapid Rewards program hard to beat for affordable domestic travel for one, let alone two.

The only thing we can do now is wait but we do have 2 months to make preparations in case these changes are quite terrible. If you have a lot of points, you may want to consider making some speculative bookings to lock trips up at the current rates. You really have nothing to lose since you can get a full refund at any time.

This is just another lesson in the frugal flying game. Things change all the time to be ready to react. Stay tuned.

British Airways Avios Devaluation

The biggest news going around the travel blogosphere lately is one we’re sadly all too familiar with… devaluation. British Airways announced some pricey changes to their loyalty program that will take effect April 28, 2015. The last time they changed their loyalty program was over 3 years ago so I suppose they’re due.

Earning Avios

There are changes to earning rates that, honestly, don’t concern me because I don’t ever fly or credit my miles to British Airways. You can read about them here.

Redeeming Avios

The changes that I care about most are the ones for redeeming Avios. Luckily, economy awards aren’t changing, but Avios amounts for premium cabin awards are definitely changing. Below is the new award chart for British Airways & Iberia metal.

New British Airways Award Chart

New British Airways Award Chart

Below is the peak calendar for 2015. Not bad if you fly BA/Iberia because most of the year is off-peak.

Peak & Off-Peak 2015

Peak & Off-Peak 2015

 

What if I use Avios to fly on partners instead of BA or Iberia?

Again, economy award rates won’t change. Premium Economy, Business and First class rates will definitely change.

Business Class redemptions will increase 50% on any route Zone 4 and beyond. This is unfortunate because there were some great sweet spot routes that fell in Zone 4. BOS-DUB & JFK-YVR are very popular.

Examples:

Boston to Dublin (Zone 4) is 25k one-way in Business Class on Aer Lingus, probably one of the best deals with Avios. On & after April 28th, BOS-DUB will be 37.5k in Business.

New York to Vancouver Zone 4) is 25k one-way in Business Class on Cathay Pacific’s Fifth Freedom flight, another top redemption with Avios. This will be 37.5k in Business going forward as well.

New York to Hong Kong (Zone 8) is 70k one-way in Business Class on Cathay Pacific. On April 28th, JFK-HKG will be 105k in Business.

What do I do now?

If you have a huge stockpile of Avios, it’s time to start thinking of redeeming the premium award you were saving for. Come April 28th, that award is only going to get more expensive. Devaluations are always good lessons for us; don’t hoard your miles & points!

As for me, I have less than 70k Avios in our household account so I won’t be employing any drastic measures. I also like to use Avios for their short-haul leverage; I flew to Montreal twice in 2014 for a mere 4,500 Avios each way. Since that award isn’t changing, I think I’ll keep some Avios handy for it.

Overall, this upcoming devaluation is bad news for those of us who like to redeem for premium travel. British Airways’ last devaluation made long-haul premium travel more expensive; this time around they might as well be unattainable.