American Airlines and US Airways To Combine Loyalty Programs In First Half of 2015

Doug Parker was interviewed recently by Business Travel News.  There were a couple of nuggets for people trying to get a sense of what’s coming up as the merger progresses.

The loyalty programs will be combined in the first 6 months of 2015.

From the customer standpoint, what’s the next major milestone to be reached in the merger?

There are a series of them, but the next major one will be the integration of the frequent-flyer programs. They’re separate today, and we’re planning to integrate those [in the first half of next year]. We’re doing a lot of things already to make sure for consumers that they get the benefits of the combined networks: code-sharing, some frequent-flyer reciprocity, day-of-departure upgrades, use of the clubs—just not a combined mileage program.

A move to a revenue-based program is not coming anytime soon.

[During an onstage appearance at the GBTA convention, Parker was asked whether American would follow Delta and United in moving to frequent-flyer program based on revenue accrued instead of miles flown. Such a move was “not even on the plate right now,” he said. “We have to get the two frequent-flyer programs merged first. If it makes sense to make that innovation, we may do that, but to try to change the program now would be foolish.”]

The article goes on to say that the New American would like to launch service from Dallas to Beijing, that they don’t expect to make money on a route like that anytime soon and they’re okay with that.

I don’t really like to hear that the programs won’t combine until 2015.  I was hoping that the elite qualifying miles I earned on US Airways would combine with my American Airlines EQMs to help me qualify for Executive Platinum more easily this year.  While not definitive, this is another signal that it’s unlikely there will be a way to combine elite activity in both programs this year.

On the heels of reading that the companies wouldn’t combine to operate as a single airline until late 2015, it’s definitely a bit better news to hear that the ability to move miles back and forth could be less than a year away.  View From The Wing speculated that this would happen by Q2 2015 ,and he seems to be right.

I didn’t think there was a reasonable chance that American Airlines would make the move to a revenue-based program in 2015.  Just too many distractions and way too many technical bowls of spaghetti to digest.  I also think that there’s a chance American Airlines can forge a path without a revenue-based program but playing to their other attributes to attract and retain lucrative corporate customers.

While I view the second point as less likely, I’m very glad to hear Doug Parker say that a move to revenue isn’t in the cards for 2014.  It’s reasonable to assume an announcement in 2015 would dictate parameters for 2016, as it’s unlikely an airline would spring a new qualification requirement mid-year.

The growth in Asia isn’t news.  The New American still trails it’s peers in this area, and it’s good to see them start to close the gap.  But, it’s unlikely to be closed anytime soon.

On balance, this is generally positive news.  I’m not happy to have a short-cut to top-tier status in 2014, but I really like hearing that the leadership view a move to a revenue-based loyalty program right now as foolish given the other items outstanding.

Waiting for the next batch of tea leaves…..


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