Aeroplan announced the next generation of its program this morning, with a reimagined approach to earning and redemptions. In this post, I’ll offer a breakdown of the news on the redemption side of the program. Then I will offer my thoughts on the winners and losers of the 2020 Aeroplan program. I will say this to start: the changes are a net negative for me, but were directly in-line with my expectations and the changes could have been much worse. Many will benefit from the new program and there is much to like.
New Aeroplan Program Launches November 8, 2020
Aeroplan will launch its new loyalty program this autumn. On the redemption side, we will see a number of changes including:
- The elimination of fuel surcharges on Air Canada and partner awards
- Stopovers on one-way awards at a cost of 5,000 miles
- Pricing that factors in both distance and zone
- Published award chart
- 39CAD booking fee on all partner awards
- Higher cancellation fees
- Family sharing
- Cash + Points option
- A comprehensive online award search engine that can build and book complex routings
Aeroplan says the average cost of an award will increase 12.7%, but current sweetspots will rise by more than 50% in some cases, as I’ll note in one poignant example below.
First, let’s look a the new award chart.
Aeroplan Publishes Innovative Award Chart Combining Zones + Distance
Aeroplan will divide the world into four regions in terms of award pricing:
- North America
- South America
A published award chart notes pricing within each zone and between zones. Not only does zone/region factor into pricing, but so does overall distance traveled. Segments are priced cumulatively rather than from origin to destination. For example, ORD-FRA-LHR would be calculated at 4,752 miles even though the direct distance between ORD-LHR is 3,953 miles.
Within North America
North America includes Central America, the Caribbean, and the Hawaiian islands.
Between North America and Atlantic zones
The “Atlantic” zone include Europe, Africa, the Middle East, and Central Asia.
Between North America and Pacific zones
The Pacific zone includes East Asia, Australia, New Zealand, and the oceania area.
Between North America and South America
Within Atlantic zone
Within Pacific zone
Between Atlantic and Pacific zones
Within South America
Between Atlantic and South America zones
Between Pacific and South America zones
Air Canada Awards Will Be Variably Priced
You’ll note above there are separate prices for awards which include Air Canada segments. Currently Aeroplan offer “fixed price” and “market price” awards on Air Canada. The new program will combine the two and offer a single variable pricing levels on Air Canada segments. That means if you are combining partners with even a short segment on Air Canada, you may end up paying significantly more than just having the partner segment.
Fuel Surcharges Are Eliminated!
The new program will eliminate fuel surcharges on all flights. One-way Lufthansa first class redemption to Europe routinely run over $800. That will now be zeroed out…almost. Aeroplan collected notoriously high fuel surcharges on Austrian and Lufthansa flights, which will not longer apply.
New 39CAD Partner Booking Fee
While fuel surcharges will be eliminated, Aeroplan will tack on a 39CAD partner booking fee to each booking. This will apply per booking, whether you book a one-way or round-trip award. As most partners do not have fuel surcharges, this move is a net negative, particularly for domestic redemptions on United Airlines, which currently only carry taxes of $5.60 per one-way ticket.
Stopovers Will Cost 5,000 Miles And Be Available On A One-Way Basis
Currently, Aeroplan allows two stopovers on a round-trip journey (if booked over the phone, one if booked online) but none on one-way tickets. Free stopovers on round-trip tickets will no longer be available, but Aeroplan will allow for stopovers on a one-way basis (one only) at a cost of 5,000 miles plus any additional taxes the stopover incurs.
Flexible Routing Rules
With the regions more loosely defined, there is no maximum permitted mileage and up to six segments permitted per one-way ticket. But Aeroplan has said that no backtracking will be permitted. We’ll still need to determine how strictly that “no backtracking” rule can be enforced. Hopefully connections in Istanbul for western Europe will still be permitted. I was told by an Aeroplan spokesperson, for example, that something like Chicago – Frankfurt – London would still be permitted. Perhaps connections within a continent will permitted, even if there is backtracking?
Higher Cancellation Fees
Change and cancellation fees will go up by as much as 33%.
More info here.
Points + Cash
Redemptions will also be offered on cash + points basis. We can only speculate at this point at what value Aeroplan will assign the points, but this could be a lucrative option if Aeroplan adopts a sliding scale system similar to what Avianca LifeMiles currently offers.
Pool Family Points
Aeroplan will allow the pooling of points among family members at no cost. This is potentially a huge benefit, especially considering Aeroplan will take a progressive approach to defining a family (i.e., you can define it the way you want). In essence, you can add anyone to your family you choose.
Winners And Losers In Aeroplan 2020 Award Chart
I see some nice sweet spots in the new chart, particularly in intra-region travel. You’ll be able to fly from Newark to Honolulu in business class for 35K miles, Frankfurt to Delhi for 45K miles in business class, or Sydney to Bangkok in first class for 60K miles. More generally, the lack of fuel surcharge will make eastbound Lufthansa First Class awards a much greater value, especially when departing from the East Coast.
Those who like redeeming Aeroplan miles for last-minute domestic tickets on United Airlines will generally not pay more points, but will incur a 39CAD booking fee, which certainly lessens the value of those redemptions.
My most common Aeroplan redemption was Los Angeles to Frankfurt in Lufthansa First Class. Currently, the award costs 70K one-way. The LAX-FRA fuel surcharge is about $800 while the FRA-LAX surcharge was closer to $300. Under the new program, the price rises to 100K each way. I value Aeroplan points at two cents each, so that extra 30K miles is the equivalent of a $600 surcharge in each direction. In that sense, I gain nothing and if I add connections, such as Frankfurt to Rome, the prices goes up to 120,000 one-way, since the cumulative mileage rises above 6,000 miles. Paying an extra 50K miles in each direction is a huge devaluation, for me personally, especially on flights back to the USA where fuel surcharges are much lower.
It’s not just premium awards. We have used 30K Aeroplan miles to travel from Los Angeles to Zurich on SWISS many times over the years. That award will now cost 40K miles, an increase of 33%.
I’m still processing all the details of this new program, but thus far it looks like a net loss for me, but only because of my residence on the West Coast and frequent trips to Europe. For many people, the new program will represent a substantial move in the positive direction. As more details unfold, I’ll be writing much more about the new Aeroplan program.