Monthly Archives: March 2013

Friday Roundup….LOT’s A330s, American Airlines’ Livery, Asiana’s Pants

– Poland’s LOT will lease an A330 from Portugal’s HiFly to replace the 787s it cannot use on flights from Warsaw to Chicago and New York. Those aircraft will fly from April 12 to the end of May, when they hope the 787 will be back in service. Unfortunately, the aircraft has an old-school business class similar to what LOT offers on their 767s (the 787s will have flat beds).

– Don’t fall in love (or keep your hate to a minimum) with American Airlines’ new livery yet. Doug Parker now says that he isn’t 100% sure they’re going to continue using the colorful new paint job once the merger integration begins.

– Asiana’s flight attendants are now allowed to wear pants.

– SAS is eliminating intra-European business class beginning in June.

I Sure Hope You Are Not Putting Actual Spend on That US Airways Credit Card

I wrote last week about why a 2% cash back credit card actually makes the most sense for everyday spend for a vast majority of people.

I received an email for an offer (enter your details to see the exact offer for you) that’s been around for a bit to purchase US Airways miles with a 100% bonus. This offer is available in some format several times a year. They’ll sell you 100,000 miles for $1881 (or 1.8 cents per mile).

As I wrote last week, because you can get 2% cash back with a couple of cards out there, by forgoing the cash back you are purchasing miles for 2 cents each. It’s ultimately your decision to calculate whether you’re getting more value than that when you put spend on a points-earning card. But US Airways is basically telling us that their miles are available for purchase at 1.8 cents per mile several times a year.

If you put any spend on your US Airways credit card, you are buying points at 2 cents per mile – you are better off getting a 2% cash back card and using the cash to purchase US Airways miles at 1.8 cents each. Other airlines don’t sell their miles (typically) this cheaply.

This isn’t to say you shouldn’t get the card – the 35,000 mile signup bonus for 1st purchase is great, and it’s (somewhat) churnable. And once in a while once you have the card they’ll have some pretty good spend bonuses. (Unlike several other airlines, US Airways does not waive checked bag fees for credit card holders).

But if you are one of the many people who are using that card to earn miles, you’re making a mistake — take the cash and buy the miles when you need them.

Here’s a Reason for a Flight Delay You Don’t See Every Day

A Saudia flight from Jeddah to Dammam was delayed because, seriously, a passenger demanded to know why a female flight attendant was permitted to travel without a male family member accompanying her. He then insisted that all unaccompanied female passengers be removed from the plane.

To Saudia’s credit (?) they had security remove the man from the flight and they departed without further incident.

According to the linked article, every woman in Saudi Arabia is required to have a male guardian (usually a family member) while traveling.

KLM Announces Business Class Seat Upgrade; SAS Announces It Will Not Upgrade Business Class Seat

KLM will roll out a flat bed in their 747-400 business class cabins over the course of the next year, replacing the angled seats that they’ve had for a while now. The new seats by BEAerospace, are similar to those found in United Airlines’ BusinessFirst cabin, which is to say they are perfectly comfortable if, perhaps, slightly hard.

The KLM seats were fine for the return trip from Europe if you were reclining and awake, but nearly everyone who has flown them overnight has found themselves 5 miles over Greenland crumpled into a ball at the bottom of the seat where they have slowly, slowly slid down over the course of 2 hours.

The only slight drawback is that they will reduce the number of seats in the cabin from 42 to 35 to accommodate the new design.

Meanwhile, SAS, which has been struggling financially, announced (apparently) in this Danish article that they will not install flat beds into their long-haul A330 and A340 aircraft because (they say) the market does not demand it. Their seats are OK, but they’re aging and don’t hold a candle to an actual flat seat. Nearly all other Star Alliance partners flying Trans-Atlantic have moved to flat beds (or are in the process of moving to fully flat beds).

Uh Oh, Should I Have Been Using a 2% Cash Back Card All These Years?

I woke up in a cold sweat over the weekend with this thought: By using a points-earning credit card for my every day purchases, am I flushing money down the toilet?

When you use a credit card (any credit card) to earn points, you are actually buying those points for 2 cents each. How so? There are 2 no annual fee cards that earn 2% cash back on all purchases (Fidelity Rewards Amex and, of all things, the Priceline Rewards Visa). By not using those cards (and I currently do not), you’re forgoing 2 cents on every dollar spent — ie, when you use a different card, you’re buying points for 2 cents each.

I’m not at all suggesting that you shouldn’t sign up for cards for the sign up bonuses — by all means, that makes a ton of sense, even if there’s some minimum spend to hit. And certainly there are cards you should use for specific spending – the Amex Blue Cash Preferred earns 6% cash back on groceries, for example. And for many people the 2X points on the Sapphire Preferred for travel and restaurants can make sense.

But for everyday purchases where you’re just earning 1 point per dollar there are very few scenarios where you’re optimizing your rewards by earning points instead of cash. Let’s take a quick look.

If you’re spending roughly $2,000/month, you’ll earn 24,000 points a year or just about enough for a round trip domestic coach ticket. You’ve given up $500 in cash for that – in most cases, not a particularly good deal. Coach ticket to Europe at 60,000 miles? $1,200 in missed cash back, in many (though not all) cases enough to pay for at least 1 ticket to Europe.

The equation changes a bit if you’re looking at complex premium cabin itineraries — a business class ticket to Asia will “cost” you $2,000, much less than actually purchasing a ticket outright (though you may reconsider flying in business if you knew it was costing you $2,000 vs. $1,000 to outright buy a coach ticket).

With the Starwood Amex card the numbers change a bit because you’re earning 1.25 airline miles per dollar spent (with the 5,000 point transfer bonus). It’s costing you 1.6 cents per point (though it’s still costing you 2 cents when you redeem at a Starwood hotel, unless you’re booking the 5th night free).

My point here isn’t that everyone should use a 2% cash back card for everyday spend – it’s that you should look at your planned spending habits and see if it makes more sense to earn points or cash. I know plenty of people who have a $90/year airline credit card and put $30,000 worth of spend on it – in nearly all cases that’s a terrible idea. You need to do your own calculations and decide. But actually go through that exercise, you might be surprised to find out you need to switch your spend strategy.

A Quick Explanation on Extra Fees When You Connect through London

In yesterday’s post I mentioned that connecting through London was generally more expensive than connecting through other cities in Europe when you book an award ticket. Gary from View from the Wing noted that you don’t pay an extra charge when you connect through the UK, you only pay when you stopover in the UK. A commenter noted that London flights ARE more expensive (as I thought). Here’s the deal:

Gary is referring to the Air Passenger Duty, which you DO NOT pay if you are connecting through London (there is a 50+ page document that the British government has put out explaining the details of this rule, but let’s just say for the sake of this discussion that you don’t pay it when you connect through London).

However, airlines may still charge a UK Passenger Service Charge (United is charging $51.40, on an Athens-London-Newark award booking). This is basically the same as the $3 Passenger Facilities Charge (PFC) that airlines charge in the US to offset airline fees. Well, it’s the same except instead of $3 it’s $51.40. This is why connecting through London can be more expensive — there is an expensive facilities charged often baked into the ticket.

So, because both Gary and I are brilliant, we are both correct. Whew.

(I’ve also updated yesterday’s post to reflect this).

5 Quick Tips for Booking Award Tickets

For whatever reason I’ve been helping a bunch of people book award tickets recently, and I thought I’d share 5 quick tips (there are probably 300 quick tips I could share when I don’t write the book I keep saying I’m going to write) for your next attempt at using those miles:

1) If there’s only 1 tip in the award booking game, it’s that you need to check back every day. Every. Day. I can’t stress this enough. I can’t tell you how many people say something to the effect of, “I checked and there was nothing available.” OK, but did you check the next day? And the day after that? Award inventory changes all the time and it’s going to take a little work. Keeping checking.

2) If you’re going to Europe and you need to connect, avoid London – the fees are higher than if you were to connect just about anywhere else. (Note: See Gary’s comment below – taxes are higher at London if you stopover, not if you connect. Still, Heathrow is a miserable place to connect and I would still avoid it).

NOTE 2: I’ve figured out the confusion around this issue (and I’ll add a separate post about this). Gary is referring to the Air Passenger Duty, which you DO NOT pay if you are connecting through London (there is a 50+ page document that the British government has put out explaining the details of this rule, but let’s just say for the sake of this discussion that you don’t pay it when you connect through London).

However, airlines may still charge a UK Passenger Service Charge (United is charging $51.40, on an Athens-London-Newark award booking). This is basically the same as the $3 Passenger Facilities Charge (PFC) that airlines charge in the US to offset airline fees. Well, it’s the same except instead of $3 it’s $51.40. This is why connecting through London can be more expensive — there is an expensive facilities charged often baked into the ticket. So, because both Gary and I are brilliant, we are both correct. Whew.

3) Check availability leg-by-leg. If you’re flying from New York to Venice and using United miles, there are many, many, many ways to route that. The United website is good, but it’s not perfect. Check each leg on its own and build your connections that way.

4) For whatever reason, many people forget about flying out on one airline (or an airline from one alliance) and flying back on an airline from a different alliance (ie, outbound on United and back on American). This is helpful because sometimes when trying to open credit cards to earn enough points for a trip, you’ll find that you can’t get enough United miles (or whatever) for a roundtrip — but you could easily get enough United miles for a 1-way and American miles for the return one-way. Think flexibly.

5) Use your United miles last if you’re flying on Star Alliance. Meaning: only use your United miles if there are no other options using other Star members’ frequent flyer miles. United is quite flexible, allowing one-ways where US Airways does not, and they do not charge fuel surcharges (unlike, say, Aeroplan – in most cases – and Singapore – in most cases). Recently I was helping someone book an award ticket on United to the Caribbean. I had her transfer her Membership Rewards points to Singapore and use those points on United (no fuel surcharges). Save United points for when you need the flexibility and use US Airways, Singapore (via Membership Rewards) or Aeroplan (via Membership Rewards) for the easy tickets where they don’t charge fuel surcharges.

Dear Air Canada….

….Thanks so much for your solid customer service. You were so nice to allow me to change my flight to Toronto today without penalty because of (the possibility of) the winter storm. That was kind of you.

You even gave me a link to re-book the ticket online. That was kinda nice.

Then when I went to that page you told me that I couldn’t rebook online, and that I should call you. You even gave me the phone number. That was helpful, since the online tool didn’t allow me to make the change.

Then I called you, and knowing how nice Canadians are, I knew you’d be able to help me out. You did help me out, by telling me in the recorded message that no agents were available and that I should call back later. You did say “goodbye” very nicely prior to hanging up on me unceremoniously.

Solid work all around, Air Canada.

TAM and LAN (That’s LATAM to you) Choses to Go with Oneworld

When TAM and LAN announced their merger (into what is now called LATAM) there was lots of speculation about whether the combined carrier would join LAN’s alliance (Oneworld) or TAM’s alliance (Star). They announced today that the combined airline will join Oneworld.

Though the move was announced today, TAM will join Oneworld in the second quarter of 2014 — so those of you with United miles have a year to fly down to Brazil on TAM using miles. LAN Colombia will also join Oneworld as an affiliate member in late 2013.

This a great news for Oneworld, which had significant South American presence already with American Airlines and the LAN family of airlines. TAM will flesh out the route map with extensive service in Brazil.

This is a pretty significant loss for Star, which has a bit of presence in South America through Copa, but doesn’t really hold a candle to what Oneworld now offers in the region.

(As a commenter noted, I did forget about AviancaTaca, which obviously has a large presence, especially out of Peru. But it still leaves a big empty space in Brazil….)

A Painful Conversation….

At dinner last night with a good friend.

Friend: I got a new watch. (Shows me the watch…)

Me: Nice watch.

Friend: Yeah. (Becomes slightly sheepish). Uh, yeah I cashed in…

Me: (No. Don’t. Please don’t say it.)

Friend: Some Amex points…

Me: (sweating)

Friend: …to get the watch.

Me: (tearing up…)

Friend: I feel like it’s hard to use those points for trips.

Me: (banging head against table)

Friend: And when I called for 4 tickets to Florida, they said that 200,000 points is only good for $1,600 worth of travel…

Me: (taking dinner fork and stabbing it into my leg, because that dulls the pain)

Friend: Plus there are never flights available.

Me: (bursting into tears, people now staring)

Friend: So I decided to get this watch.

Me: (a blubbering mess)

Pause

Pause

Me: Cool, it’s a great watch.