American Waives Rush Fees, but Only for Elites

Effective yesterday, July 29, Gold- and Platinum-level elite members of American's AAdvantage program are exempt from the so-called close-in fees for booking award travel within 21 days of travel. (AAdvantage members who had attained the program's highest level of elite status, Executive Platinum, were already spared from the fees.)

For background, United did away with these fees more than a year ago. And they did away with them for all members of the Mileage Plus program, not just elites. So: advantage United, both for the timing of their policy change, and for its scope.

Delta, earlier this summer, followed United's example, discontinuing the fees for all SkyMiles members. So Delta is also ahead of American, both in beating American to the punch and in exempting non-elites as well as elites.

These fees are huge revenue-generators for the airlines—tens of millions of dollars annually for the largest carriers, by my own rough estimate. So it's no wonder that American wants to keep them in place for the great majority of AAdvantage members.

But close-in booking fees are the very personification of nuisance fees. As I argued in a recent column on airline fees, it costs American no more to allow an AAdvantage member to book an award last minute than to book 21 days out.

Charging extra for a service that costs the airline nothing extra to provide is, to be blunt, a gouge.

Exempting Gold and Platinum members from these nasty surcharges is a step in the right direction. But American has stopped well short of real fairness and decency.

You shouldn't have to be an elite customer to avoid being gouged.

United Discounts Short-Haul Award Tickets by 30%

By my count, United has offered discounted award travel 11 times during the past 18 months, making such discounts a regular if unofficial feature of the Mileage Plus program.

The latest award sale makes it an even dozen.

Offer Details

Mileage Plus members can save 30 percent on coach-class award tickets for short-haul flights (less than 700 miles) within the U.S., or between the U.S. and Canada. With the discount, the price of a round-trip Saver award is reduced from 25,000 to 17,500 miles, and a one-way Saver award drops from 12,500 to 8,750 miles. A round-trip Miles & Money award is reduced from 10,000 to 7,000 miles, plus cash, but United warns that "this award type may not be offered on every flight."

Bookings must be made by August 31, but travel at the reduced prices can be completed any time before January 7, 2010.

Deal or No Deal

It goes practically without saying that paying less is better than paying more. So if there's a short flight already in your plans, taking advantage of the discount is a no-brainer. You might even want to squeeze in an unplanned short trip, just to get some extra value from your miles.

This might also be an opportunity for Mileage Plus members with modest account balances to use their miles for an award that would otherwise exceed their mileage budget.

Reader Reality Check

Have you taken advantage of United's previous award sales?

Will you take advantage of this one?

Flying to Europe? Choose Your Airline Alliance

The oneworld global airline alliance is on a roll.

In the past week, the consortium of airlines—American, British Airways, Cathay Pacific, Finnair, Iberia, Japan Airlines, LAN, Malev, Mexicana, Qantas, and Royal Jordanian—has announced a new European partner, and received regulatory clearance to jointly operate transatlantic flights.

Alliances Dominate Europe Flights

Last week, the U.S. department of Transportation (DOT) followed the European Commission in granting antitrust immunity to American, British Airways, Iberia, Finnair, and Royal Jordanian on their transatlantic routes, including "plans for an integrated joint venture in which American, British Airways and Iberia would cooperate on all their transatlantic flights and services." That means those carriers are now free to jointly set schedules and fares across the Atlantic, effectively eliminating any pressure among the affected airlines to compete with lower prices or better service.

Some competition will remain, of course. But with most other transatlantic airlines already participating in one of the other two global alliances—SkyTeam and Star, both of which already enjoy anti-trust immunity—the competition has been reduced to the three mega-groups, plus a few independents like Virgin Atlantic.

American and British Airways have been trying to get approval for a transatlantic partnership for 14 years, and the just-approved anti-trust immunity was originally proposed to the DOT in 2008. So the ruling came as no great surprise.

Air Berlin Now (JetBlue Later?)

What was surprising was yesterday's announcement that oneworld will be adding another European airline to the partner roster: Air Berlin.

Air Berlin is, according to the oneworld press release, the sixth largest European airline. So it's a substantial airline, size-wise. But while it's not exactly a discount carrier, like Southwest or Ryanair, neither is it a full-service airline, like the other oneworld airlines.

It's been called a hybrid carrier, like, well JetBlue. Which recently began interline and frequent flyer partnership with oneworld founding partner, American. Which naturally gives rise to speculation that JetBlue might eventually be invited to join oneworld.

Stay tuned.

Winners and Losers

For all the airlines' promises of "seamless travel" and the like, the real beneficiaries of airline alliances are the participating airlines' own bottom lines.

Anti-trust immunity—like that now in effect for all three alliances across the Atlantic—means that companies may legally collude to set prices, exactly the sort of corporate coziness that anti-trust laws were designed to prevent.

Alliances themselves are a form of consolidation, which reduces competition and, inevitably, leads to higher prices. And that's exacerbated by affording anti-trust protection to alliance participants.

But the DOT disagrees, opining that oneworld "on balance, was pro-competitive."

There is one noteworthy consumer benefit that comes with the DOT ruling: Members of American's AAdvantage program will be able to earn and redeem miles for British Airways transatlantic flights; and British Airways Executive Club members will be able to do the same on American's transatlantic flights. In order to preserve competition between American and British Airways, such joint marketing had been expressly prohibited previously.

Alliances are now a fact of travel life, and are likely to become more entrenched, more dominant than ever in the future.

If you can't beat 'em, or avoid 'em, your best bet is to understand 'em, and use 'em to your advantage.

Double Southwest Credits for Philly, Baltimore, Washington Flights

If you're headed to or from Philadelphia, Baltimore, or Washington, D.C., Southwest has the flights, and a bonus to make those flights extra-rewarding.

Offer Details

Through September 30, Rapid Rewards members can earn double credits for Southwest flights to or from Philadelphia, Baltimore/Washington, or Washington (Dulles).

To earn the bonus, flights must be booked by August 11.

Registration is required.

Deal or No Deal

Aside from Delta's triple-mile promotion for Shuttle flights between New York and Washington, D.C., this is the only mileage bonus on offer for flights to or from these three areas.

So, if you're already a Southwest loyalist, this offer is a no-brainer. And if you don't normally fly Southwest, this might be a good reason to do so now.

Reader Reality Check

If you're aware of any better offers, please chime in.

Otherwise, what are you waiting for?

Virgin America Adds Boutique Hotels to Elevate Program

Members of Virgin America's Elevate program can now earn points for stays at Joie de Vivre hotels, a collection of California boutique properties.

To earn Elevate points—one per dollar spent—travelers must also be members of the hotel's Joy of Life Club and indicate Elevate as their earning preference. But through December, as a launch promotion, hotel guests can earn both Elevate points and Joy of Life points for the same stays.

The press release characterizes the hotel group as follows: "San Francisco-based Joie de Vivre is the second largest independent boutique hotel company in the U.S. and manages the largest boutique hotel collection in California." What that amounts to, though, is just 33 hotels, paltry by the standards of the major hotel chains.

Naysayers will knock the latest addition to Elevate as more style than substance. That's true in part. But Elevate already partners with Hilton—the multi-brand behemoth, with thousands of properties worldwide—and another boutique hotel collection, the Morgan Hotel Group. That's a significant amount of hotel choices for members of a program as small as Virgin America's.

And the Joie de Vivre collection makes up in personality what it lacks in size and scope. While not on the must-stay lists of the average business traveler, such hotels as the Ventana Inn & Spa in Big Sur and the Hotel Erwin in Venice are a welcome relief from the cookie-cutter hotels that have done so much to homogenize the travel experience.

Who said an airline loyalty program can't have style?

Midwest Changes Mile Expiration Rule in Run Up to Frontier Merger

Following the decision by the two airlines' common owner, Republic Airways Holdings, to merge them, Frontier and Midwest are on track to have most of their operations consolidated by the end of this year, including unification of the two airlines' frequent flyer programs, Frontier Early Returns and Midwest Miles.

According to an email announcement last week from Midwest:

As a reminder, we expect to be operating the Midwest Miles frequent flyer program under the Frontier EarlyReturns name this fall. At that time, all the miles you've earned will be combined in a single account with the same account number you currently use. You'll also be able to log in to your account on FrontierAirlines.com using the same user ID and password you currently use.

Most of the changes will take place behind the scenes, with little or no action required from members of either program. But there is at least one policy change that Midwest Miles members need to pay special attention to:

Your frequent flyer miles will not expire as long as you continue to earn miles from flying or with a program partner. Beginning in January 2011, miles will expire in 24 months of inactivity—a change from the current 36 months.

That of course is to bring Midwest's policy into alignment with Frontier's 24-month expiration policy. They could have adopted Midwest's more liberal policy instead, but with the current industry standard set between 18 months and two years, there was no competitive reason to do so.

The email addressed another question I've heard raised by Midwest Miles members, that of their program-affiliated credit card:

You will be issued a new Frontier Airlines MasterCard in the fall. Your account number will remain the same, and you'll continue to receive the same great benefits you have today. Look for more information about your new Frontier Airlines MasterCard in the coming weeks.

According to the merger timeline, the plan is to have new affinity cards in the wallets of current Midwest Miles members by December 1.

A few other upcoming milestones worth noting:

• September 15 - Consolidation of EarlyReturns and Midwest Miles accounts
• October 1 - Midwest Miles name disappears, to be replaced by EarlyReturns
• November 1 - Single website and reservations system
• December 1 - Single award-booking system

And last but not least:

• August 1 - Cookies on all Frontier and Midwest flights

New BFFs, American and JetBlue Partner on Flights, Frequent Flyer Miles

The airline business is one of the world's most incestuous. Even as carriers furiously match and beat their competitors' prices, to keep from losing the merest slivers of market share, they doggedly work together with those same airlines on joint fares, interlining, global alliances, reciprocal frequent flyer program participation, and so on.

If ever there were an argument for the coexistence of cooperation and competition, the airlines are it.

Still, when American and JetBlue unveiled, in March, the outlines of their upcoming "commercial agreement," it was a mild surprise.

American partnering with JetBlue isn't quite like a tie-up between Delta and AirTran, which fight to the death for passengers flying to and from Atlanta, where both carriers are based. But it is improbable.

In particular, American and JetBlue both have major presences at Boston's Logan and New York's JFK airports. Both operate cross-country flights from the Los Angeles and San Francisco areas. And both serve Florida destinations from the Northeast.

There are also fundamental differences in the companies' backgrounds and characters. American is a legacy carrier, with a hub-and-spoke flight network, first-class seats, and airport lounges. JetBlue is a relative upstart, based on the Southwest anti-legacy model, but with more attitude and class.

They are, in short, unlikely partners.

But rather than accentuate the adversarial aspect of their business overlap, American and JetBlue have decided to capitalize on it, to mutual advantage.

The Partnership Begins

Beginning today, July 20, travelers can make easier connections between non-overlapping American and JetBlue flights in Boston and New York.

Specifically, American customers can connect to 18 of JetBlue's domestic flights, including Nantucket, Burlington, Buffalo, Denver, Houston, Washington-Dulles, Jacksonville, New Orleans, West Palm, Richmond, Rochester, Fort Myers, Salt Lake City, Sarasota, Syracuse, and both Portland, Oregon and Portland, Maine.

And JetBlue customers can connect to 14 of American's international destinations from New York and Boston, including Barcelona, Brussels, Paris, Buenos Aires, Rome, Sao Paulo, London, Madrid, Manchester, Milan, Tokyo, Zurich, plus planned flights to Rio de Janeiro and Tokyo-Haneda.

"Later this year," according to the press release, members of American's AAdvantage program will be able to earn miles when flying on those 18 JetBlue routes; and members of the JetBlue TrueBlue program will be able to do the same when flying on the 14 American routes.

Who Benefits, and How

By streamlining sales and operations of these flights, American expects to gain more JetBlue customers—who otherwise might have selected a different carrier for the overseas portion of their trip—and JetBlue expects more customers from American—who otherwise might have booked the domestic portion of their international trip on a different airline.

The frequent flyer miles give partisans of both carriers extra incentive to book the other airline.

What's in it for travelers? In a word: convenience. International flyers can now book a flight from, say, New Orleans to New York on JetBlue, connecting to an American flight to Madrid, all on a single ticket. In theory at least, American and JetBlue will have adjusted their schedules to make the connection at JFK a relatively seamless one.

And if that's not enough, there are those frequent flyer miles ...

New Amex Card Perk: Access to US Airways Airport Lounges

Among travel-rewards credit and charge cards, there's an intensifying scramble to add cardholder perks, both to bolster their customer bases and to keep existing users reaching for their cards.

Among the recent developments was Continental's enhancement of its card benefits and Delta's waiver of checked bag fees for holders of its SkyMiles credit cards.

The latest move in this escalating perk-athon is from American Express, which announced last week that holders of two of its Membership Rewards cards would henceforth enjoy access to 17 US Airways airport lounges in 13 cities.

According to the American Express press release, "Consumers who are passionate about travel and carry the Platinum or Centurion card can look forward to an enhanced airport experience, just for being an American Express Card member."

To "passionate," we might add "big spending"—the annual fee for the Platinum card is $450; and the invitation-only Centurion card costs $2,500 a year, plus a $5,000 initiation fee.

But at least for the Platinum card, lounge access alone potentially makes the fee a justifiable expenditure. An annual membership to US Airways lounges costs $450. And Platinum and Centurion cardholders already had access to the lounges operated by American, Continental, and Delta, normally priced at $500, $475, and $450, respectively.

It's worth noting that in US Airways' case, lounge access is not predicated on the cardholder's actually flying US Airways. You could, for example, be flying on JetBlue and still use the US Airways club. With the other airport clubs, cardholders must be traveling on the airline that operates the lounge.

Although the two things are nominally unrelated, the addition of US Airways to the list of lounge partnerships raises the question of American Express's lounge relationships with Continental (which it currently has) and United (which it does not have).

When Continental and United merge later this year, Chase—which issues co-branded cards for both airlines—will have a lot to say about whether United—which, post-merger, will be the world's largest airline—maintains the relationship with American Express, or not. Will Chase be comfortable with United offering such a high-value perk to holders of competing credit cards?

My best guess is that they won't, and American express cardholders will find themselves without access to the lounges of either Continental or United.

That won't drive a stake through the hearts of the pricey American Express cards—they'll still offer lounge access across the considerable networks of American, Delta, and US Airways.

But if I were in the market for a new rewards credit card, and access to the lounges of either Continental or United were a priority, I'd hold off on opting for the Platinum card until it's clear whether, as I suspect, the addition of US Airways is one step forward before taking two steps back.

The Best Time to Get a Starwood Credit Card May Be Now

Update: The sign-up bonus for this card, originally set to expire on July 6, has been extended to July 31.

There's plenty of room for argument when it comes to the best airline mileage program, the best hotel program, the best frequent flyer promotion, and so on. But when it comes to travel rewards credit cards, the heated discussions typically resolve into a chorus of harmonized voices singing the praises of a single contender: the Starwood Preferred Guest credit card issued by American Express.

There are two keys to the card's outsized popularity.

First, the Starwood Preferred Guest points earned by using the card can be converted into miles in more than 30 airline programs, including those of Aeroplan, Alaska, American, British Airways, Continental, Delta, Hawaiian, United, and US Airways.

Points generally transfer 1:1 for airline miles, although it's a disappointing 1:2 conversion rate for Continental and United miles.

And second, there's a 5,000-point bonus when transferring 20,000 points. So transferring 20,000 Starwood points to American, for example, nets 25,000 AAdvantage miles.

With the bonus, then, one dollar charged to the Starwood card is worth 1.25 miles in many airline programs. That's more than the one-mile-per-dollar earning rate for charges on the airlines' own co-branded cards. And miles earned with those cards can't be readily converted into other programs.

The price for the card's value and flexibility: a very reasonable $45 annual fee. And that's waived for the first year.

(While Starwood Preferred Guest is a solid hotel program, the fact that points can be redeemed for free room nights is almost beside the point.)

Offer Details

Through July 6, consumers who sign up for a new Starwood card will earn 30,000 points after spending $1,000 or more within the first three months.

Deal or No Deal

The current standard sign-up offer for the Starwood card is 25,000 points. And the best past offer I can recall was 15,000 points after the first purchase plus another 15,000 points after spending $15,000 within six months. So this new limited-time offer is the most compelling I've ever seen for this card.

While the bonus isn't quite the jaw-dropper of the recent British Airways credit card sign-up promotion (100,000 bonus miles after charging $2,000 within three months), it's a very good offer for an excellent card.

If the card meets your needs, and you don't already have one in your wallet, there may never be a better time to apply.

Reader Reality Check

Interested?

If not, why not?

Starwood Rewards Frequent Stays With "Rewarding Returns"

Members of Starwood's Preferred Guest program who register for the Rewarding Returns offer and complete five stays between July 1 and December 31 will receive a choice of three bonuses. The bonuses vary somewhat according to the member's profile—yours will be displayed only after you register.

The basic bonus, that most members are offered, is a choice of one of the following:

• 4,000 bonus points
• $50 certificate redeemable for hotel services during a stay
• 25 percent discount on an award redemption of up to five nights at any Category 1 - 5 property through July 31, 2011

The offer may be combined with other Starwood promotions.

Deal or No Deal

Unless you're a business traveler, or a leisure traveler blessed with inordinate quantities of time and money, the five-stay requirement probably puts this offer out of reach.

And the bonuses themselves are hardly stellar.

If this were all we could expect from Starwood for the rest of the year, average Preferred Guest members would have reason to look to other hotel chains for solid bonuses. My best guess, however, is that Starwood intends this to augment rather than to replace more mainstream promotions.

The Rewarding Returns offer is combinable with Starwood's other current promotion—one free night offer after three stays through July 31. And I expect we'll see at least one more similarly accessible promotion, also combinable with Rewarding Returns, this year.

For bona fide frequent travelers who can log the required five stays, the question is which of the three bonuses to choose. Your mileage may vary, but using the 25 percent award discount to reduce the price of a five-night Category 5 award stay from 48,000 to 36,000 points looks like a winner to me.

That's a lot of points, to be sure. But if you qualify for the promotion, you probably have them.

Reader Reality Check

Do you plan to complete five Starwood stays by the end of the year?

Which of the three bonuses would be most valuable to you?