Earlier today I wrote about United’s new earning structure for partner flights, effective July 1, 2020. While the policy penalizes those outside the USA, I would not call it unfair. At the same time, I cannot think of a more tone deaf move on the part of United Airlines now.
Why The United MileagePlus Policy Change On Partner Flight Earnings Is Fair
When I first wrote about the 2020 MileagePlus program changes last autumn, it was already clear there were tremendous arbitrage opportunities to earn status for far less than the dollar values set by United.
United eliminated the category of distance in calculating elite points for its own segments (only dollar spend and segments would count) but essentially re-introduced mileage runs by allowing partner flights to count toward elite spending requirements…by factoring distance.
As one commenter aptly noted:
Also ironic that this will result in people spending more money to “not” fly United. Did I say irony? I meant something else…
Well, the irony is no longer lost on United, especially as it fights for survival.
For mileage aficionados, there was a perverse disincentive to avoid flying United. Choosing Singapore Airlines over United on a cheap San Francisco to Singapore flight could result in 3-4X greater MileagePlus earnings on Singapore than United.
Clearly, as United desperately tries to rebuild, it wants to incentivize customers to fly on its own planes.
In that sense, the policy change is fair.
Why The United MileagePlus Policy Change Is Tone Deaf
But while this change may be fair, it is certainly tone deaf. People are not flying now, but looking ahead to when they can fly again. United was just the recipient of a huge bailout from the U.S. taxpayer. Yes, United was very generous to extent status and cut status requirements for 2021. But it had to do something to woo customers back.
And this new policy change strikes me as unnecessarily adverse during a time in which United should be doing all it can to earn customer’s trust. Just like on the refund issue, people are taking note and will remember which airlines took care of them and which airlines did not. Business is a two-way street.
United had a great opportunity to build upon the positive news of its status extension and offer additional incentives to fly on United. United could have even offered a less painful disincentive. It could have also increased the divisor, essentially reducing the number of PQDs earned on partner tickets without setting artificially low caps.
Sadly for United, it will once again be viewed as penny-wise, pound-foolish by further devaluing its MileagePlus program and pulling the rug out from a new earning scheme that is only four months old. If United decided, with one day of notice, that this valuable feature must go, what confidence do MileagePlus members have that other perks or positive program features won’t be taken away without notice?
How This Could Backfire On United
I’ve got a friend who lives in Singapore. He has been loyal to United for decades, always re-qualifying for 1K status. Yes, he uses Singapore Airlines or Thai Airways for regional or European flying to help re-qualify for status, but spends thousands of dollars per year on tickets between Singapore and the U.S. on United metal due to EconomyPlus and the chance of upgrades.
With United now no longer counting partner flights as generously, he may well just give up on status and start using Singapore Airlines for his transpacific status. That will cost United thousands in revenue.
People who took advantage of these arbitrage opportunities were discretionary passengers on the margins. United has shown hostility toward such travelers going back to the Smisek era, so this is hardly a shock. But I still think the “hey this isn’t fair they are qualifying so cheaply” mentality does not account for the whole picture.
United’s war on travelers at the margin has never made sense to me. It continues to reward the sort of corporate travelers who have no choice anyway (and also receive deeply discounted tickets due to bulk discounts). Especially as the economy rebounds slowly and air travel even more slowly, it’s not like they will be “stealing” seats when load factors are so light.
And if the quip is “they never wanted to fly United anyway” then I guess that means they are not stealing premium seats from any “worthier” customers.
Customers will not reward desperation and this move strikes me as desperation. United is so desperate to win customers back that it further undermines its more valuable asset (MileagePlus) in a way that will actually drive more business away than draw it in it. But yes, technically the new policy is fair, at least when compared to earning on United flights.