American Airlines, at least temporarily, is now a Citi transfer partner. That presents a valuable new use of those points, increases the attractiveness of AAdvantage, but also will likely accelerate the next American Airlines devaluation.
An American Airlines AAdvantage Devaluation Is Coming
Folks, there is a huge American Airlines devaluation coming. It’s a just a matter of when. Of course that is true for all loyalty programs, but for American (and Alaska) in particular. The current chief of AAdvantage cannot understand why passengers like award charts, has warned of dynamic pricing, and therefore all but promised American Airlines will devalue its miles.
That means I’d take advantage of certain sweet spots now, including:
- First Class to Japan on JAL – 80K miles one-way
- Business Class to East Asia on JAL or Cathay Pacific – 60-70K miles one-way
- Business Class to Africa via Doha on Qatar – 75K miles one-way
I do not expect these to last. I expect most prices will rise, some will go down (sort of like AA’s current Web Special awards), but savvy customers who enjoy redeeming their miles for premium cabins on partner airlines will find their points worth far less than they currently are.
Which leads us to what may accelerate this devaluation: American Airlines is now a Citi transfer partner.
Transfer Citi Points To American Airlines AAdvtange
If you have the following Citi cards, you can now send your points to AA on a 1:1 basis:
- Chairman
- Prestige
- Premier
If you have the following Citi cards, you can send your points to AA on a 1:2 basis (two Citi ThankYou points = 1 AAdvantage mile):
- Preferred
- Rewards+
This is billed as temporary (through November 13, 2021), though I expect it to be a permanent change. What I expect to change is the transfer rate – the 1:1 basis for Citi’s higher end cards is likely not permanent, though may be extended once more.
The interim period presents a perfect test case for American, though. How many points will be transferred over? What kind of redemptions will be made? Should this overwhelm the system, AA could always pull it back and restrict the new transfer option by devaluing it or blocking it completely.
AA will also be watching closely to see how the ability make flexible Citi ThankYou points transferable to American Airlines impacts its own portfolio of credits. A real concern is whether users will stop signing up or spending on AA co-branded credit cards if they can use a flexible card instead.
But at least for now, the ability to top off your AA account with Citi points marks the golden opportunity to book AA awards.
CONCLUSION
On the one hand, I am excited about the new Citi transfer option to American Airlines AAdvantage and the additional doors it will open. On the other hand, I am cognizant of the likelihood this move will accelerate a devaluation at American Airlines. If you are eyeing an award book now: not only is there now a lot more competition for those seats, but the price may soon rise…potentially without any notice.
I was excited at first about this when I heard yesterday and was ready to transfer my Citi points over last night. Common sense prevailed though in backing off for now. Stranding them in AA given the lack of award space and what will now be even more people fighting for the scraps out there seems foolish. If I find a good redemption prior to November, great. If not, they are far more valuable sitting in my Citi account and waiting.
I totally agree with Stuart’s comments and am following the same game plan.
How responsible is it to tell people they should travel to Japan and East Asia where the majority of the local population isn’t vaccinated?
I hope that by next spring the situation will be better.