American Airlines revamps its frequent flier program

American Airlines is changing its frequent flier program, becoming the latest carrier to have passengers earn miles based on how much they spend rather than how far they fly.

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American, now the world’s largest carrier following its merger with US Airways, stood pat with its traditional set-up for more than a year after its rivals changed. That’s less than under the current system, in which the same flier would earn 9,502 miles because the flight is 9,502 miles round trip.

“American Airlines has spent the last two years being singularly focused on integration”.

Following competitors Delta and United, American Airlines will now dole out member rewards based exclusively on the price of a ticket, not distance traveled.

Redemption rates will increase for long-haul flights, such as to Europe and Asian, and premium cabins due to high market demand for those higher-priced flights, higher award redemption demand and more competitive pricing on those tickets, Rubin said.

Mileage earning: Travelers will now earn miles for flights based on the base fare of their ticket instead of the miles flown.

American is tinkering with what’s generally regarded as the best frequent flier program among major carriers.

For tickets booked on or after March 22, award-redemption levels to popular destinations in Mexico, the Caribbean, and Central America will be reduced, American said.

The move, long anticipated by investors, makes it harder for travelers to attain elite status and benefits on American by booking flights on the cheap that log thousands of miles.

The changes, which are being unveiled to members of the AAdvantage program in e-mails today, affect three major areas of the AAdvantage program: mileage earning, mileage redemption and qualification for “elite” status in the program, which comes with perks such as free checked bags and first class upgrades.

Suzanne Rubin, who heads the AAdvantage program, said the company has spent the past two years consolidating rewards programs after merging with US Airways in 2013.

Rewards will also depend on a customer’s AAdvantage status.

Non-elites will earn five miles per dollar spent; AAdvantage Golds will get seven, Platinums will earn eight, and Executive Platinums will bring in 11 miles per dollar spent, American said. Dallas-based Southwest Airlines which switched to a dollar-based system in 2011.

“On the flip side, if you buy an $800 ticket to Asia, you are only going to get 4,000 miles versus 20,000 in the old program”, Kelly said.

Industry experts said the change to a revenue-based rewards program seemed inevitable, and the changes to the program overall balanced the financial needs of the airline with the desires of its frequent fliers.