A Rebuttal to Gary Leff over the US Airways/American Upgrade Policies
Gary Leff has published yet another blog post about why he feels that the American AAdvantage system of upgrades is better for elite flyers and Why Complimentary Upgrades are Bad for Frequent Flyers. He seemed delighted that, on a recent flight, there were empty seats in the first class cabin (I wonder if there were any Chairman Preferred on that flight that were not upgraded – but that is a different story).
What I would like to do is address a few of his points directly.
- The sale of stickers, combined with mileage upgrade co-pays that do not exempt elite frequent flyers even domestically, mean that American earns a revenue premium on their first class cabin.
Not all upgrades are going to generate a large revenue premium. If one simplty uses his upgrade certificate, no revenue is generated. If one chooses to purchase additional upgrade certificates, the revenue generated is a paltry $30/certificate. Even assuming that the longest transcon upgrade will require five of these $150 hardly offsets the price of a seat in coach that could be sold if a member is upgraded, thereby freeing up more seats in coach. And I am not sure the revenue will offset the amount of ill will towards the airline when elite members see those empty seats.
- A more profitable first class cabin also supports a better first class product. American flyers were in uproar as their first class meals were cut back even a little, more or less meeting the old US Airways halfway. The revenue lets American invest in the product. (I wouldn’t call American’s first class spectacular, but it is materially better than US Airways first class.)
Doug Parker is in a great position now to turn American back into a profitable airline just as he did with US Airways after the America West Merger. That success did not involve selling upgrade instruments. I’ve flown the American First product, and other than the fact that some of the planes are newer and some of the planes have the new lie flat seats for trans-cons, it is just not that different than flying First on US Airways. As the old America West/US Airways planes are phased out, the hard product will improve across the board. I would respectfully submit that Gary hasn’t flown even a quarter of the US Airways First flights that I have and I have found them to be lacking in some areas (power ports mainly) but superior in others (crew members).
- Mid-tier and entry-level elites are actually better off without unlimited complimentary upgrades. When every passenger gets free upgrades, every passenger is requesting them almost every time. Elites who want to upgrade have to compete against every other elite every time.
Again, not only do I find this statement incredibly condescending but I have to disagree with this. At US Airways, we don’t request upgrades (except for our Envoy certs). We know what the proverbial pecking order is and if one is careful in choosing flights, the upgrade chances increase exponentially, thereby rewarding all frequent and loyal flyers. As a Silver, no, you won’t be upgraded as much as a Chairmans Preferred, but you will get upgraded. And if you want an upgrade badly enough, miles serve the purpose for that.
- When elites are rationing their free upgrades or they have to pay some amount, they actually have to make a decision when they care about getting the upgrade.
I don’t even know how to respond to this. What? If you are loyal to an airline, an upgrade is almost like the Holy Grail. We all want them. All the time. When would you not care about getting an upgrade? And even though you request it with your little upgrade instrument, there is no guarantee that you will get it. Unlimited upgrades reward loyalty – to everyone.
- The upgrades go to the people who want them most.
- And Golds don’t have to compete against all Platinums, and Platinums don’t have to compete against every other Platinum for the upgrade. That means upgrade percentages go up. You’re more likely to get the upgrade when you request it.
Again, when you fly US Airways, you know the system. It is fair and it works. I never think I am in a competition with others to get an upgrade. The system works, for the most part, in a fair and equitable manner. As a lower tier, upgrades are a delightful surprise and as such, much more appreciated. Complimentary upgrades reward everyone who is loyal to the airline and that is how it should be. I don’t want to have to request an upgrade and then be disappointed when I don’t get it.
- Most US Airways flyers are going to want to keep the system they have. I expect the average elite frequent flyer to say, why should I have to pay for something they used to give me for free?
Exactly. But it’s not really free, is it. Plenty of dollars were spent to establish loyalty and earn status with the airline. Why should that loyalty not be rewarded?
Gary mentions meals (again):
As for the meals issue, meh. It really doesn’t merit much more discussion. I have never seen such a whinging bunch of folks in my life. If you are flying and you know there is not going to be a meal offered, plan on packing a lunch at home or stopping in the airport and picking up a sandwich. Many of the loudest complainers also spend a lot of time in airport lounges – if you have time for that, then you have time to grab something for on the plane. I guarantee that it will be better than anything you are going to get on a domestic flight. I even do that if I am flying coach on an international flight and believe me, have even received envious looks from the flight crew as I’m tucking in to my Bring My Own Meal. In the longer run, planning and bringing your own food is much healthier for you.
I know my ‘voice’ is not as big as Gary Leff’s (whom I admire greatly by the way), but this is most assuredly the way I feel and I’ll repeat it. I hope it doesn’t happen, but I have a feeling that the US Airways loyalists are going to be pulling the short straw on the combining of programs.
And that will make me very sad indeed.
What do you think? Can the merger of the two loyalty programs find a common ground?
Should flights go out with empty seats in First?
I absolutely disagree with Gary Leff on this issue and this is the comment that I left on his blog:
I totally disagree with your assessment. Anyone can argue a point particularly if it is in line with what their believe to be ‘true’. It has been obvious from the outset of this merger where your loyalties lie.
I find it hilarious that American flyers are still beating the meals issue to death. Unless I am flying an international route, I could care less about a meal on a plane. No matter how you dress it or serve it, it is nothing but a glorified TV dinner….. Even those ‘delightful’ ice cream sundaes are often barely edible because they are frozen harder than a brick.
As for the upgrades, it makes NO sense for a F cabin to go out with empty seats. Sure, leave those seats empty and then pay the poor people who get bumped out of oversold coach rather than upgrading to the front and filling the back. How does revenue balance out there in the big picture? Loyalty should be rewarded whether one is a business traveler with all or most expenses paid…or a retired schoolteacher who just happens to love your airline and chooses to fly it faithfully.
I personally believe the ‘sticker’ system is absurd as it stands. US tried it in the 90’s and scrapped it. If the ‘stickers’ were good for a full segment, then perhaps they would be useful. As they stand, farnorthtrader has it right….too many are required for a reasonable flight.
I have resigned myself to the fact that US Airways loyal flyers, who stuck with them through the America West merger and subsequent austerity goof-ups, are probably going to come out of this merger pretty well screwed to the wall –
Unfortunately, it is going to be the people who flew Parker’s low cost carrier through thick and thin – who helped it crawl out of a hole and operate in the black for several years in a row – helped it to become strong enough to BUY American out of bankruptcy – yes, it’s going to be those loyal flyers who get the shaft on this if the AAdvantage program (as it is) dominates the merger of the two.
Totally agree with you
Thank you…. and thanks for speaking out as well.
Oh you’re so blind sighted. I too use to think like you when I was a nwa/dl flier than I moved to AA and found upgrades to come more frequently as a low or mid tier flier. as a AA plat (50/yr) i receive more upgrades than when I was a DL plat (75k/yr) post merger. the difference. I upgraded when I want or feel as though it’s granted.
also mind you AA didn’t go into bankruptcy when all the other airlInes did and when they were in bankruptcy not only were they profitable but they had millions (more than any other airline in history) in reserves. they only did it to shed the pension which they didn’t she’d post 9/11 like the other airlines. Doug Parker is famed for turning airlines into LCC, charging for sodas, aND turning good airlines into shit. let’s be real of legacy carries US should of merged with NWA as they both offered bottom of the barrel products. no ife, no power, etc. even the brand new a321 which US were delivered in 2013 had no ife and no in seat power. talk about cheap. not to mention only 4 rows of F when most planes thay side have 6-8 rows. finally remember Doug Parker striped PMUS planes of in flight radio and TV after the merger with American West. be quick to forget the horrors Parker brought to US airways as flyers were #parked but douggie.
but if you think as someone who isn’t chairmen or exp will be upgraded on a flight withat 16 f and 171 other passengers. good luck! UDU Will never get you there
What some people fail to consider is that with the merger there are going to be more planes and more seats. The ratio of seats to preferreds is going not going to change exponentially. Sure, there may be a few less mid-tier upgrades… but they will still be there. The point is – why go out with empty seats when you can award those seats to mid-tier elites instead of having them pay for them? Gary says he’s happy to see empty seats in the forward cabin – I am not.
Yes, when Doug Parker took over US Airways, he made some huge mistakes (charging for soft drinks, etc.) and as a result of that he lost a large number of customers. The airline rebalanced itself and turned into an airline making a profit while at the same time satisfying its loyal customer base.
Some of the arguments for IFE and meals on short flights really don’t matter to many of us. Power ports, yes (as I mentioned above).
I have never made the argument that everyone who wants one will get an upgrade – I’ve just argued that the present US System rewards its most faithful better than the AAdvantage program does.
I am a loyal USAirways customer (Chairman’s Preferred) who, along with many other loyal USAirways customers, am concerned and frankly worried about the merger with American Airlines.
I’ve never had such a good relationship with an airline as I have had over the last ten years with USAirways. They give me complimentary first class upgrades on most flights. My wife also gets complimentary upgrades.
When I spend over $25,000 on a USAirways Mastercard (I have three), they give me 10,000 Preferred Dividend Miles, which has helped me reach my elite status.
Much of my family’s travel (there are ten of us) is to the U.S. Virgin Islands from Washington, D.C. with connections through either Charlotte or Philadelphia. We could fly non-stop (for the same price and sometimes less) but we fly USAirways because of the upgrades, which are made available to us a full week before departure. We’re told we can upgrade on American as well, but only if seats remain available on the date of departure. Not impressive and a very bad indication of how American will be treating its best customers.
Should I book award travel using my Dividend Miles and want to make a change, no penalties are assessed because of my status as Chairman’s Preferred. American will charge its most valued customers $150 on each flight. That says a great deal about how much you value our loyalty and patronage.
We have come to think of USAirways as our friend, as family, and as such, we have a stake in its success. Will the best customers say the same thing about the new American? It would appear that very few of the benefits that USAirways accorded its best customers, and generated such extraordinary loyalty, will carry over with the new airline. Instead, it appears AA plans to adhere to the same policies that didn’t work too well with the old American.
That would be most sad. It’s not only loyal passengers—like us—who will be hurt. Should the “New American” go in the wrong direction on this, its shareholders will also suffer, not to mention the thousands of dedicated USAirways and AA employees who may also incur heartbreaking setbacks.
Agree – thank you.
Totally agree with you. If Excutive Platinums also had to use vouchers I am sure Gary would be singing a different tune
Where is the ‘Like’ button for this? Thanks for commenting.