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Travel Is airline elite status still worth it?

15:51  20 september  2021
15:51  20 september  2021 Source:   thepointsguy.com

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The skies have not been consistently smooth for airlines in … well, a while. Before the delta variant began its rapid spread across the globe, demand for leisure travel had shown great promise over the summer, and business travel had begun to return, albeit at a slower pace than was hoped. Combined with breakthrough cases of illness in vaccinated individuals, and hospitalization spikes, and many would-be travelers remain too concerned about the risks of COVID-19 to travel.

With the pandemic dragging on, airlines have had to create a new playbook on the fly to keep loyal customers engaged. And in turn, consumers have actually benefited from a shift in the power dynamic as airlines have reduced status requirements, lowered spending thresholds or even outright given away status to try to lure in more leisure travel dollars.

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At TPG, we love elite status benefits such as first-class upgrades, dedicated customer service assistance, waived change fees and more. But if we are looking at it objectively, is airline elite status even worth it right now?

Here are arguments both for and against taking another spin on the elite status hamster wheel.

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Why elite status it isn’t worth it

Many elite benefits overlap with credit card benefits

The main benefits of airline elite status typically comprise complimentary upgrades, priority check-in, early boarding and waived checked bag fees. However, many of these perks can be mirrored with a cobranded airline credit card.

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For around $100 per year, you can get a mid-tier airline card and enjoy many of the same benefits, plus discounts on inflight purchases (a perk not even offered to elites).

The United Explorer Card even offers expanded award availability to cardholders, which is normally reserved for elites, as well as a pair of United Club passes each year.

(Photo by Darren Murph/The Points Guy) © The Points Guy (Photo by Darren Murph/The Points Guy)

Meanwhile, more upscale airline credit cards, as well as premium travel rewards cards like The Platinum Card® from American Express, proffer even more benefits, including lounge access in some cases — which elites typically don’t even get without a ticket to fly in the front of the plane.

Some airline cards, such as the Delta SkyMiles® Reserve American Express Card and the Alaska Airlines Visa Signature® credit card, even reward cardholders with annual companion flight certificates (though the terms of these vary widely from card to card), which elites don’t normally get simply from status, either.

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Considering that even the lower rungs of airline elite status typically require a couple of thousand dollars in annual spending, it may be better to pay a flat annual fee for one of these cards and guarantee access to the perks that matter to you without going out of your way to chase status.

a room filled with furniture and a flat screen tv: American Airlines Admirals Club at BOS. (Photo by Benji Stawski/The Points Guy) © The Points Guy American Airlines Admirals Club at BOS. (Photo by Benji Stawski/The Points Guy)

Upgrades are still hard to come by

While the pandemic has led to fewer elite flyers, upgrades are still elusive, especially for lower-level elites. While fewer people are flying, there are also fewer flights operating, so most flights that go out are full, even with reduced business travel. This translates to continued competition for business- and first-class seats.

The other issue is that airlines automatically extended elite status, which means there are still lots of travelers eligible for upgrades. For example, Delta Air Lines automatically extended all elite status through January of 2023.

You are also now starting to see folks who earned status with lower thresholds that airlines put in place last year join the competitive pool.

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Add in more aggressive upselling of premium seats by airlines, likely in order to bring in as many dollars as possible, and you have limited “free” upgrades.

Delta Air Lines, for example, often offers upgrades to first class at discounted prices all the way until a day before departure. TPG senior news editor Clint Henderson was recently offered an upgrade to first class on a flight from San Francisco to Salt Lake City for just 9,900 Delta SkyMiles or $99 cash (he jumped on the miles upgrade at that price).

Then there’s the problem of all those people trying to use upgrade certificates that were extended from 2019 and 2020. Oftentimes, you’re fighting to use them and the airlines are simply not making upgrade space available to elites. Both Delta and American Airlines, for example, can be stingy with releasing upgrade inventory — something that has not gotten better during the pandemic.

It’s cheap to book first class outright

You don’t need to be a top-tier elite or super big spender to fly first class these days.

Now more than ever before, airlines want to maximize revenue by selling premium-cabin seats rather than simply giving them away. With the vacuum left by fewer business travelers, some premium-cabin seats have become less expensive. After all, an airline probably figures that even a little revenue from these seats is better than none at all.

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Take, for instance, a route like New York-JFK to Chicago (ORD). It’s not uncommon for flights on this route to have a couple of dozen elites on the upgrade list. However, you can typically book first class outright on this route for under $200 each way — a roughly $100 premium over standard economy. On longer flights, such as Los Angeles (LAX) to Miami (MIA), business-class seats can be booked for under $400 each way — a $210 premium over coach.

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Sure, you’ll still be paying more than for economy. However, you’re guaranteed the better seat and won’t be forced to always fly the same airline regardless of schedule and price because of being on the elite status hamster wheel.

Likewise, saver-level premium-cabin award space is plentiful these days.

Take for instance the nation’s most premier route: Los Angeles (LAX) to New York-JFK. Although this route usually commands a premium in either price or mileage, and has historically been difficult to book at the saver award level, it’s now not uncommon to find American Airlines business-class awards for under 25,000 miles each way on this route.

table: (Screenshot courtesy of aa.com) © The Points Guy (Screenshot courtesy of aa.com)

Even if you put most of your spending on transferable points credit cards, you’ve probably racked up a large point balance with programs like American Express Membership Rewards and Chase Ultimate Rewards points.

The best use of these points is to transfer them to airlines and book premium-cabin awards. So, if you’re using points to guarantee yourself a seat at the front of the plane, along with the benefits that these tickets confer (checked bags, priority boarding, etc.) what value will you get from having elite status?

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Airlines have eliminated change fees for everyone

Although often overshadowed by more glamorous perks like free upgrades and lounge access, for a long time, one of the most valuable perks of elite status was greater flexibility.

Most elite statuses offer some form of a same-day change benefit. Some status levels even offer waived ticket change/cancellation fees. This benefit could save you hundreds of dollars as it effectively allows you to put tickets on hold for as long as you need.

However, these benefits are mostly irrelevant now that many airlines have done away with those fees. Most award and paid tickets can now be changed or canceled for free by anyone and award tickets have essentially become refundable.

a group of people in a room: (Photo by Benji Stawski/The Points Guy) © The Points Guy (Photo by Benji Stawski/The Points Guy)

Likewise, United now offers free same-day standby for all passengers, allowing you to easily switch to an earlier flight.

Sure, complimentary confirmed same-day changes, which are usually reserved for elite members, are nice to have, but they probably aren’t worth chasing status for.

Reduced meals and service

(Photo by Zach Griff/The Points Guy) © The Points Guy (Photo by Zach Griff/The Points Guy)

Another reason to get off the elite status hamster wheel? Reduced service.

Many airlines are still operating under pandemic guidelines framed as being for the sake of safety, though they have the side benefit (to airlines, at least) of major cost savings.

While American Airlines is reopening its Flagship lounges, and was a leader in bringing back meal service, other carriers like Delta Air Lines are still offering limited service.

In fact, Delta has brought back hot food in their lounges, but most meals served onboard are still snack boxes or snack packs. Only on long-haul transcontinental and international flights will you see hot food on Delta.

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Why elite status may still be worth it

If you’re chasing top-tier status

a man driving a car: (Photo by Jose Luis Pelaez Inc/Getty Images) © The Points Guy (Photo by Jose Luis Pelaez Inc/Getty Images)

As discussed, it’s fairly easy to replicate entry-level and mid-tier elite status benefits with cobranded airline credit cards. However, top-tier elite status is a bit of a different story.

Top-tier elites typically get some tangible rewards upon qualifying for status, such as upgrade certificates or the ability to gift entry-level status to someone else. Upgrades are also much more likely to clear since these elites are at the top of the status food chain.

Although this is less commonly applied, top-tier elites also get noticeably better treatment and may occasionally get transfers between gates during tight connections. Finally, many of the best airport lounges, particularly first-class lounges, are typically reserved just for first-class customers and top-tier elites — you typically can’t access them with a credit card or lounge membership.

Related: Is it worth pursuing lifetime elite status?

Better customer service

You will get much better customer service as a top-tier elite. Period.

a group of people standing in front of a building: (Photo by Caiaimage/Chris Ryan/Getty Images) © The Points Guy (Photo by Caiaimage/Chris Ryan/Getty Images)

Oftentimes, elite members will have access to dedicated phone service numbers, or the airline will recognize the phone they are calling from, and will route them to elite phone agents that will help them faster or allow them to skip the line altogether. The rules applied to these valuable customers’ accounts can also be more … flexible.

TPG has found that, especially this summer as Delta was inundated with phone calls, wait times could exceed three hours. Our staff with elite status on Delta rarely had to wait that long. You can’t put a price tag on your valuable time, and elite status will help save you time and patience.

Related: The 9-hour wait: Here’s why hold times are so bad

You’ll also get priority during irregular operations. That was another huge problem this summer as weather and operational meltdowns led to mass flight cancelations for airlines like Spirit and American Airlines.

Not only will top-tier elites’ calls get answered more quickly, but they will also typically get first priority when it comes to rebooking. Those with status get the first pick of new flights if they are facing a cancellation. Often, the major airlines will even rebook top-tier elites on competitors just to keep the most loyal/valuable customers.

Earning status is easier than ever this year

While elite status might not seem as valuable as it once was, it has also become more attainable than ever.

a desk with a laptop computer sitting on top of a table: Elite status comes with a ton of perks, from free checked bags to confirmed lie-flat upgrades. (Photo by Zach Honig/The Points Guy) © The Points Guy Elite status comes with a ton of perks, from free checked bags to confirmed lie-flat upgrades. (Photo by Zach Honig/The Points Guy)

Due to the pandemic, most airlines have lowered their 2021 elite status qualification requirements, making it much easier for members to earn, requalify or upgrade their elite status tiers.

On top of that, frequent flyer programs have been offering back-to-back promotions, such as rewarding passengers with double elite-qualifying miles on flights. Delta has even begun awarding Medallion Qualification Miles, Medallion Qualification Segments and Medallion Qualification Dollars on award tickets and will continue to do so through at least the end of 2022. With travel still down significantly compared to pre-pandemic highs, these fast-tracks to elite status will likely stick around for a while.

All of this is before even considering the elite status shortcuts offered by cobranded airline credit cards.

Even in normal times, many airline credit cards allow cardholders to earn incremental credits toward status through their spending. Some cards, such as the United Explorer Card and United Club Infinite Card, even recently increased the number of Premier Qualifying Points that can be earned with credit card spending. Depending on the card and how much you spend, you may be able to earn status without ever setting foot on a plane.

Related: The best credit cards to jump-start elite status

Fewer frequent flyers and business travelers means a chance of upgrades for top-tier elites

a person in a blue room: Alaska Airlines first-class cabin on a 737. (Photo by Clint Henderson/The Points Guy) © The Points Guy Alaska Airlines first-class cabin on a 737. (Photo by Clint Henderson/The Points Guy)

One of the best parts of traveling during the early days of the pandemic was nearly unlimited upgrades for those who were traveling with elite status. Those days are long gone, but top-tier elites are still getting some more upgrades than before.

Fewer business trips and business travelers mean you aren’t competing against so many high-status individuals as often on certain routes. You are more likely to get upgraded on those leisure destination trips as a top-tier elite. Operationally, it’s better for the airline to give upgrades if they can sell that coach seat to a city like Las Vegas.

TPG’s Clint Henderson said his upgrade percentage on Alaska Airlines was hovering around 95% even during the height of this summer’s busy travel season as an MVP Gold 75K (Alaska’s current top level). Meanwhile, I have been getting frequent operational upgrades on hub-to-hub American Airlines flights, such as New York-JFK to Miami (MIA) as a top-tier Japan Airlines elite, even though Oneworld partner elites typically don’t get upgrades.

This doesn’t apply as much to lower-tier elites, but those at the top still have it pretty good when it comes to pandemic-era upgrades.

Bottom line

The value of airline elite status ultimately depends on how much use it and value you get from it.

For most people, it probably won’t be worth going very far out of your way to chase airline elite status. You can easily replicate many of the perks that a low- or even mid-tier elite traveler would enjoy by holding the right credit cards and buying the occasional upgrade to first class. This is especially true as the price difference between economy and first class has narrowed on some popular routes.

That said, there are some exceptions for those who are true road warriors and can achieve top-tier elite status. Flying with top-tier airline status is still a different experience than without it. Likewise, between the reduced qualifications and promotions being offered this year, it may be worth pushing through if you’re just short of crossing the finish line given the different pathways to status that have opened up this year via rollover miles, credit card spending and other promotions.

So is airline elite status worth it? Sure, it can be. But only if you can get to a relatively high tier without trying too hard or spending too much.

Featured photo by Ryan Patterson/The Points Guy.

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Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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Find an airline credit card that works for you both on the ground and in the air.Air travel is surging as people are making up for lost vacations and business travel. But when you look in your wallet, do you have any of the best airline credit cards—the ones that will maximize both your increased travel spending and your at-home buys? Or are you still using the first travel credit card that caught your eye with minimal mileage-earning potential? If it’s the latter, you could be leaving free flights or a faster track to frequent flier elite status on the table.

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