Two major airlines have already entered a bankruptcy/restructuring procedure. Although both Virgin Australia and South African Airways are bullish about their perspectives to survive that process. After witnessing a “run on the bank”, the first thing both programs did was to suspend redemptions in their Frequent Flyer Programs Velocity and Voyager. There is no reliable schedule when such redemptions may resume and under what conditions. While it might be too late for these two programs, make sure to apply one valuable piece of advice for any other program: If you have the slightest doubt about the survival of your program operator, cash in your points as quickly as possible – and ideally on more stable partner airlines. There is no guarantee that such bookings would be honoured in case of a bankruptcy, but it is probably the best you can try. Avianca has filed for bankruptcy as well, but its LifeMiles program (still) allows redemptions.
While the current crisis might only accerelate the fate of certain airlines, such as South African (see above), which were in an unstable situation before, certain state aids will represent an unexpected chance for survival. This is certainly the case of Alitalia, which has been looking in vain for a buyer for several years and which will now be renationalised. For that relaunch of a much smaller Alitalia, which will focus on long-haul flights, the Italian government will provide a 3-billion Euro injection – yet an irrational sum compared to the some 10 billions the Lufthansa Group or Air France KLM get while being 6-7 times larger. But to go from there to come up with a conspiracy theory that the Covid-19 virus was created by Alitalia might be a bit too far-fetched nevertheless… The Italian government is also considering switching Alitalia from SkyTeam to Star Alliance although it is unclear what benefit Alitalia will gain: Lufthansa will certainly not accept a strong long-haul presence of Alitalia, but would rather like to see it downgrade to a more regional role.
The doors of most hotels were hardly open when Accor was already there with an aggressive promotion to accompany the return to business: Quadruple ALL points in all their properties in Greater China, including in Taiwan and Mongolia, which were comparably little affected by the Covid outbreak. This concerns some 400 out of their 5,000 properties. The promotion is valid for stays of at least two nights until 31 August and registration is required. Excluding the brands of Ibis and below, this corresponds to an earn rate of 100 points per 10 EUR spent for base members. 100 points have a cash value of 2 EUR when redeemed in-house again, corresponding to a saving of 20%. You understand what to expect in the months to come from loyalty programs, fighting aggressively for market shares.
Back in 2017, Air Canada announced the launch of its own loyalty program for June 2020 and promised to provide detailed information well in advance. This information was due long before any pandemic, but now we are a few weeks ahead of the launch date and nobody has the slightest clue what will be happening. Let’s hope that they are busy working on the redesign of the program since a far more competitive program will now be required than what anyone could have imagined until recently. In the meantime, Air Canada launched an interesting promotion called “Travel at Home”, which allows achieving elite status or moving up with any non-air activities until May 31, including the transfer of credit card points. Nice initiative, but why should somebody take the gamble and shift 50,000 miles into the Aeroplan program without having any idea what they will still be worth under the new program? It is fair to assume that the elite program, which has always been managed by Air Canada, won’t be subject to dramatic changes – although any member outside of Canada would certainly hope to be able to qualify for elite statuses without the current requirement for a high share of activity on Air Canada itself, but nothing is clear for the reward side once which will be assumed by Air Canada as well. A pity and missed opportunity for this nice carrier since nobody needs such additional uncertainity around loyalty programs in these times.
If you are not yet ready to travel again, earnings from credit cards are likely to be your most important source to increase your point balances. And from that perspective, you can basically only hope that you are a resident of the UAE, since Emirates is now catching up with the previous lead Etihad took by introducing some of the most fantastic credit card offers for high spenders. As such, Skywards has recently introduced yet another high-profile offer in form of a MasterCard issued by RAKBANK, characterised by a high earning rate, Silver membership in the Skywards program (with a possibility to upgrade to Gold purely on a spend basis), complimentary membership in the LoungeKey program and a range of lifestyle benefits. But depending on your exact profile, there are various other products by Skywards and Etihad Guest, which might be even more attractive to you!
The reassuring information first: Airlines would usually not turn their focus to China to get inspired by best practices for their FFPs. And it can only be hoped for that it will be like that this time as well. The general hope for frequent flyers is that the initial months after the Covid crisis, when business will be picking up again, will be highly rewarding for them as airlines will use their loyalty programs massively to lure business towards them. However, with China as first major country having moved to that post-Covid status, nothing like that can be observed at all – it seems to be business as usual. But let’s hope – and there are fair reasons to do so! – that the cultural differences will prevail since China is indeed a market, where aggressive mileage promotions from loyalty programs are not very common place. For instance, the last mileage-based promotion at China Southern’s SkyPearlClub dates back to spring 2019…
It was the first full entry into an alliance of an airline in many years – but maybe the strangest one ever. As with many other airlines, Royal Air Maroc suspended temporarily all flights on March 21 – but joined the oneworld alliance nevertheless as planned on April 01, just without the usual PR noise. Until today, the website of Royal Air Maroc does not mention a single word how its Safar Flyer program was changed as a result, but most oneworld partners now list Royal Air Maroc as new partner in their program information. The differences between the programs are though considerable. For Business Class flights, one accrues up to 200% of miles flown with the program of American Airlines, AAdvantage, while the programs of British Airways and Iberia, Executive Club and Iberia Plus, turn out to be the most generous ones in Economy Class. On the other side, most booking classes in Economy Class are excluded from any mileage accrual in the program of Cathay Pacific, Asia Miles.
While free rebooking even the cheapest fare has become the new industry standard in the current context, some airlines are definitely more forward-looking than others when it comes to securing future business. Etihad customers with a reservation until June 30 can cancel their flight and receive a corresponding flight credit for future flights. If you actually use that flight credit for a flight booking made prior to September 30 for any new date until July 31, 2021, Etihad Guest members receive an additional mileage bonus of up to 5,000 miles plus a cash credit of up to 400 USD, depending on the travel class and destination.
Latam and Delta started their partnership as planned April 01, one month ahead of Latam’s departure from oneworld. The opportunity for LatamPass members resulting from that, to pool miles during one month for flights with Delta and American into one program, remains widely a theoretical possibility in front of the current developments, due to a lack of flights… LatamPass also slightly adjusted partner airlines award levels in March, but values literally only shifted by a few hundreds of miles – with the exception of, and against market trends, award levels in Business Class on short- and medium-haul flights, which increased considerably.
While most airlines were busy grounding most of their flights, Russian carrier Nordwind Airlines launched its first ever FFP, Nordwind Club. The program has three tier levels to serve the true frequent flyers, but also awards miles on charter flights as well as on its sister company Pegas Fly to cater for the leisure-type of travellers. However, earn and burn rates are not very transparent, making it a bit difficult to judge the attractiveness of the program. With Nordwind being based at Aeroflot’s main basis in Moscow Sheremetyevo, it remains to be seen whether this will really be enough to become a challenger to its dominating Bonus program – what should not be too difficult, given the latter’s weaknesses and limited attractiveness.