What the New American AAdvantage Means for US Airways

American Airlines finally announced its plans for combining the loyalty programs of both merger partners: American Airlines AAdvantage and US Airways Dividend Miles. The “changes” are heavily in favor of the existing AAdvantage program, and that’s what makes it a little unusual. I was expecting some kind of ugly mess as they took pieces of each program — sort of like how United and Continental couldn’t stand to leave a single thing unchanged in the name of compromise.

If you’re an existing member of the AAdvantage loyalty program, there’s nothing really to worry about. Amol plans to cover that, and as I recall he has been trying to goose his way toward Executive Platinum status by crediting flights to both programs. I predicted, then recanted, and then gave up on trying to predict that American and US Airways would combine balances for 2014 when determining status in 2015. It looks like that will happen anyway, but not until the second quarter, leaving people in a bit of limbo for the early part of the year. But be sure to read his thoughts on the matter and other developments.

Notable Changes for US Airways Members

If you’re a Dividend Miles member, then the changes probably look bad. The Platinum Preferred tier will be eliminated, shoving people down to AAdvantage Platinum. Despite using the same metal to describe it, the status is more comparable to Gold Preferred. And a lot of features of American AAdvantage, in terms of how status is earned and upgrades are awarded, will apply to the new combined program.

If you chose to fly US Airways because you liked how they did things, tough. American is certainly a little different. For example:

If you fly in a premium cabin or with a full-fare ticket on American Airlines, you’ll earn elite status faster. Maybe. Elite Qualifying Miles are only earned according to the actual distance flown. The bonus credit is calculated as a separate number called Elite Qualifying Points. EQPs and EQMs don’t combine, and you’ll earn fewer EQPs if you fly on cheap tickets. It can be a wash unless you’re always flying premium fares. (I actually like EQPs, and argued that they’re one reason i don’t think American will switch to a revenue model like United or Delta.)

If you are used to unlimited domestic upgrades, American requires you to use 500-mile upgrade coupons to request upgrades only on the flights you care most about. I think this is a good idea as it reduces the competition and you can always buy more 500-mile coupons. Offering unlimited upgrades to everyone tends to make them near impossible for lower elite tiers. Not everyone agrees.

American still has a pretty generous bonus on award miles for its Platinum tier (again, this is mid-tier status earned at 50,000 EQMs). Instead of earning 50% more as a Gold Preferred or 75% more as a Platinum Preferred with US Airways, you’ll earn a 100% bonus as a Platinum member with AAdvantage. On the other hand, AAdvantage Platinum members get only two free checked bags, not three.

You can see more changes in the elite status comparison table that I last updated at the start of 2014. Most of the benefits for American Airlines members remain the same (but keep reading).

How concerned should Platinum Preferred members be about getting knocked down a peg in the new American? It depends. The major losses are free same-day changes, one less checked bag, and having to pay for upgrades by redeeming 500-mile upgrade coupons. But you’ll earn more miles, and other benefits will stay mostly the same. It’s not so much a devaluation but rather the elimination of your current elite tier, and unfortunately the one you now qualify for isn’t as good. I would say that you now have added incentive to earn Executive Platinum. Those perks have improved compared to what was previously offered to either airline’s top-tier members.

Same-Day Change Policies

American AAdvantage will finally provide free same-day changes for Executive Platinum members that don’t require you to show up at the airport and wait on standby. This is something US Airways already provides with its MoveUp offer, which is free to all Dividend Miles elite members.

The bad news: same day changes will now have a cost for Preferred Silver, Gold, and Platinum members who are integrated into the AAdvantage Gold and Platinum tiers. The good news: same-day changes will be more flexible than MoveUp, which is limited to a flight within six hours of the original departure and requires the same number of stops. American Airlines allows changes to a new flight on the same calendar day and only requires that the origin and destination be the same (you could move to a non-stop).

It stinks for lower-tier elites from US Airways, but it’s good for top-tier members of both programs.

Upgrade Policies

Integrating the program will take some time, and before that happens, current members with elite status in US Airways will still be able to get unlimited complimentary domestic upgrades on US Airways flights for them and one companion. But once merged, the new American AAdvantage will throw US Airways customers a bone with free upgrades on flights under 500 miles — no coupon required.

NOTE: To improve your upgrade priority before the programs combine, do not book codeshares. US Airways flights with AA numbers and American Airlines-operated flights with US numbers will offer complimentary upgrades based on availability at check-in only.

I think Chairman’s Preferred members will look forward to the integration when they become new Executive Platinum members. They’ll still get unlimited domestic upgrades under either policy, and they’ll also get eight eVIP systemwide upgrades after the programs combine in mid-2015. These are some of the most valuable upgrades among U.S. carriers because they have no fare restrictions. Eight eVIPs are enough for four round-trip upgrades if you’re flying to Europe, Asia, South America, or somewhere else.

US Airways previously only offered two systemwide upgrades, and you’ll still get to use those until the programs merge. Current Chairman’s Preferred members are looking at lots of upgrades in 2015. 😉

For comparison. United offers more upgrades in total, but these are divided into domestic and international upgrades and include moderate fare restrictions. Delta recently relaxed its fare restrictions but still doesn’t offer a large number.

Migration Timeline

American Airlines has provided a timeline on its website that, while specific in details, doesn’t yet tell us when the actual integration will take place. What we do know: In early 2015, you’ll have a chance to link your existing Dividend Miles account number to your American AAdvantage account number. If you don’t have an AAdvantage account, one will be assigned. (Linking doesn’t do much. It just lets them know you have accounts with both programs.)

On March 1, you’ll get your new elite status for each program. This will be determined exclusively by the flights you credited to that program during 2014. Nothing will be combined yet.

Sometime in the second quarter of 2015, the programs will be combined. This means:

• Your Dividend Miles balance will be merged with your AAdvantage miles balance, creating one combined pool of award miles.
• Your status will be updated to reflect travel on both carriers during 2014. So you could in theory have mid-tier status with each for the first few months of 2015, and then get bumped up to Executive Platinum.
• New upgrade policies and elite benefits will apply, and you’ll be able to book AAnytime awards on US Airways flights with no blackout dates.
• The two airlines will continue to operate separately through much of 2015. By the end of the year they hope to merge their reservations systems so that you can book and manage flights for either carrier using the American Airlines website.

After 2015, who knows? The new American Airlines is taking a cautious approach. This isn’t really a combined loyalty program but rather a system for matching Dividend Preferred elites into the existing AAdvantage program, making a few minor tweaks that could have been announced with or without a merger. I think Dividend Miles members are gaining a lot in this transition despite some hits to the upgrade policy. But looking at how unlimited upgrades have performed at other large network carriers like United and Delta, you’re not missing much.