Per InsideFlyer and the Wall Street Journal, Delta SkyMiles will become a revenue-based program on January 1, 2015.
If you don’t have a WSJ subscription, you can Google “Delta Plots Major Rewrite of Frequent-Flier Rules” and click on the article.
Flyers will earn miles based on the cost of the ticket purchased, and not on the distance flown.
“Under Delta’s new rules, scheduled to be announced on Wednesday, passengers with no elite status in SkyMiles will receive five miles for each dollar spent on tickets, excluding government taxes and fees. Those in the highest elite level (Diamond Medallion) will receive 11 miles per dollar spent.”
That means, excluding points earned from a credit card, the best cpm one can acheive is 9.1cpm for a flight. Say goodbye to mileage runs on Delta.
Silver Medallions will earn a base of 7 miles per dollar, Gold Medallions 8 miles per dollar, and Platinum Medallions 9 miles per dollar.
As an example, let’s say you purchase a $400 round-trip fare between Los Angeles and Atlanta. Under the current rules, you would earn about 1,950 miles in each direction, or 3,900 miles roundtrip. If you have connections, you’d earn more miles. If you have elite status, you could earn an additional 25%, 100%, or 125% more based on what status you have.
Under next year’s rules, it’ll depend on your fare. A check of my past fares show that there is about $50 of taxes and fees on a $400 domestic LAX-ATL fare, so you would only earn miles based on the $350 base fare. That means you would earn only 1,750 miles roundtrip as a base member, less than half of what one used to earn.
Needless to say, this is a huge change for price-conscious travelers.
On the other hand, let’s say you’re a business traveler who purchases a last-minute business class fare from New York to London roundtrip. That ticket would cost about $6,000. Under current rules, you would earn about 10,350 miles, since it’s a 6900-mile roundtrip and you get a 50% bonus for a business class ticket.
Next year, the same ticket will earn approximately 28,830 miles, and that’s before any elite bonuses.
Sadly, many of us don’t fall under this camp.
Still yet to hear on mileage redemption
As for mileage redemption…
“For fliers redeeming their miles, Delta will continue to award tickets by pricing them in miles, not in actual cash fares, offering different levels of availability as it does today […]Delta plans to introduce a system with up to five tiers of redemption choices so customers will have a wider variety of options, including one-way reward tickets and the ability to redeem tickets using both miles and cash, Mr. Robertson said. The new redemption levels will be disclosed in the fourth quarter.”
Well, we’ve always wanted one-way awards on Delta, right? 😛
As if the 3-tiered system wasn’t confusing enough, we’ll soon get a 5-tiered system. I guess we’ll have a low tier, a low-mid tier, a mid-tier, a mid-high tier, and high-tier. I’m sure we’ll be waiting with bated breath to see how many miles we’ll need to fly to places like Asia, Australia, and Europe in Business Class, especially with partners…
Until we see what the redemption chart looks like, it’s hard to say what the extent of the damage is going to be. Delta’s best redemptions have always been on partner programs, like Korean Air and Virgin Australia. Needless to say, this is 99.99% bad news, but if there’s one thing about this hobby, it’s trying to find value in everything possible.
What about miles earned through other means?
The thing is, all these changes affect people who fly Delta. For the time-being, Alaska Airlines is still a partner, and many people who are forced to fly Delta for work (e.g., those who live in hubs like Atlanta or Minneapolis) credit their Delta flights to Alaska to earn much more valuable miles. Considering their “war” in Seattle, I don’t know how long they will be partners, and I’m sure there will be some changes to the partnership mileage earning with this announcement.
But what about those who earn miles mainly through credit card bonuses and spending? Delta miles are still easy to earn, what with ample bonuses on the Delta American Express credit cards, as well as American Express Membership Rewards cards. And not to mention the Suntrust Delta Debit Card, which earns 1 mile/dollar, including on transactions you can’t use a credit card for.
Also, it will be interesting to see how miles earned in 2014 combine with miles earned in 2015.
From a screenshot on InsideFlyer, it looks as if Delta will performing a big “reset,” and keep old miles separate from new ones.
I used to be a primarily Delta flyer as a former Atlanta resident. While I enjoyed flying Delta, my frustration with SkyMiles is what drove me away. I felt I understood in theory how to get value out of the program, but Delta’s lack of upkeep for their award redemption systems were what infuriated me. I would see availability on Skyteam partners and Platinum Medallion reservations agents wouldn’t know how to book those seats. If Delta really wants to reward their big spenders, they really need to make mileage redemption easier.
Sad to say, I think other airlines will follow soon. It only took United a few months to copy Delta’s Medallion Qualifying Dollars move….