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Points and miles can offer incredible value if used correctly, enabling everyday flyers the chance to cheaply enjoy perks normally reserved for business executives and the ultra-rich. However, if you’re not careful to value your points and miles, you could effectively be throwing your rewards away.
When it comes to the actual value of points and miles, no two award redemptions are alike. Even short-haul economy awards can deliver attractive value, particularly when booked at the last minute when fares are high.
Conversely, there are circumstances in which long-haul economy awards can be practically worthless. Even saver-level business-class redemptions can offer sub-par value in some situations. Here are some examples of potential award redemptions that could render your points almost worthless.
British Airways Economy (World Traveller) Awards
British Airways has among the highest fuel surcharges out there on award tickets. Flyers can easily pay over $1,000 in surcharges alone on some business-class and first-class redemptions.
In the back of the plane, things aren’t much better. An off-peak saver level World Traveller award using Avios is priced at 26,000 miles plus $524.66, round-trip:
Cash fares for nonstop economy flights on the same dates are as follows:
Not only would one be throwing away 26,000 points on this redemption, but you’d actually be throwing away over $150 in cash compared to the lowest economy airfare. Even fares on Virgin Atlantic and Delta, which offer what many would argue is a superior economy class experience, are in the same ballpark as British Airways economy award surcharges.
Air France Angle-Flat Business Class, New York to Paris
Air France generally offers fantastic business-class service on international flights, highlighted by the excellent reverse-herringbone seats available on the airline’s Boeing 777-300ER aircraft. There’s one exception, however, that makes for a paltry a business-class award redemption. The airline’s A380s are still (somehow) equipped with angle-flat seats.
Air France charges on average of about $550 in fees and surcharges on a round-trip business-class award redemption. While Air France offers what many consider to be a better overall business-class experience than boutique all-business class competitor La Compagnie, the seats on the Air France A380 are hardly a big step up from La Compagnie’s angle-flat 2-2 seating.
Moreover, La Compagnie offers round-trip fare sales for as low as $1,250. More realistically, fares this spring are available starting at around $1,500, or about 125,000 Amex Membership Rewards points or Chase Ultimate Rewards points spent through a credit card travel portal (100,000 points for Chase Sapphire Reserve cardholders). That means that you save absolutely nothing by booking a 125,000 round-trip award
Considering that international business class is all about the bed, it’s difficult to justify blowing $550 in this case. Note: For flyers traveling one-way, Air France fees on flights from the US to Europe are significantly lower than on the return.
Flying Blue (Air France/KLM) Economy Awards to European Hubs
While FlyingBlue doesn’t have surcharges as high as rival British Airways’, they’re enough to make redemptions a challenging proposition, even at the lowest level.
Consider a mid-January redemption on Air France, round-trip from New York (JFK) to Paris (CDG). The airline wants a total of 50,000 Flying Blue miles in economy, plus nearly $250 in fees, including taxes.
Unless you’re dying to fly Air France in economy, it’s probably not worth it — the out-of-pocket price of this award is about two Ben Franklins shy of a cash fare on a similar nonstop itinerary.
Let’s clarify the math we’re looking at here. The cash fare for this route, nonstop on a Norwegian 787 Dreamliner, is $440, given present exchange rates.
That means that 50,000 points or miles, via Flying Blue, nets $200. That calculates out to $0.004 per point. Not exactly worthless, but close enough to consider this a no-go.
European Economy Redemptions on Aeroplan
The situation with Lufthansa tickets to German cities is similar when booking via Aeroplan.
In this case, between Chicago O’Hare (ORD) and Frankfurt (FRA), 60,000 Aeroplan miles nets about a $200 USD savings (when converted presently) over a cash fare, an even worse value than Flying Blue’s offer.
Bottom Line
As fares tend to increase sharply in the days before a scheduled departure, the redemptions discussed in this article may prove more valuable in cases where last-minute decisions are being made. While European carriers aren’t the only airlines to add surcharges to award tickets, the low cash price of nonstop flights to Europe can easily render economy awards a lackluster or even negative value proposition.
It’s important, whenever booking, to consider the cash fare alternative and decide accordingly whether you’re getting reasonable value for your miles. If you need to use points, consider using a pay-with-points portal to purchase tickets at a fixed rate. In each of the above cases, paying with points would have offered far better value than overpriced, overtaxed economy awards.
Source: thepointsguy.com