Travel News

Travel Trends: Airfares Rising, Value Of Frequent-Flier Miles Falling

Locations in this article:  Atlanta, GA San Francisco, CA

Airfares Rising, Frequent-Flier Mile Value FallingAirfares are going up, and the value of your loyalty points is going down.

Peter recently chatted with Chris McGinnis, director of the Travel Skills Group and frequent blogger for the San Francisco Chronicle, about the latest trends in the travel.

Peter Greenberg: Chris, how bad is the news?

Chris McGinnis: It definitely is getting pretty bad. Usually around this time of year I start getting a lot of calls from folks asking should I go ahead and book my summer trip? Typically, I would say you may want to wait until around Easter because usually the airlines will drop some summer airfare sales around then. But the first problem is that Easter is very late this year, not until April 24, so that’s not a very good idea. Second, we’re in this environment now with increasing demand and increasing oil prices, and fares are really shooting up. A personal example: I like to go to Martha’s Vineyard every summer around the fourth of July. That’s the peak of the peak summer travel season, especially in Martha’s Vineyard. It’s always expensive, so I always book my ticket well ahead of time.

Airfares Getting More ExpensiveWell I booked it in January and paid $605, and thank goodness I did because I just checked and it was anywhere from $710 to $795. And those $710 flights were red-eyes from San Francisco which you don’t really want to take.

PG: That’s not like a 6 percent increase; that’s a 20 percent increase.

CM: Oh yeah. I think it’s just going to continue. I think the airlines are still going to come out with their little teaser fares and say, “Great fares starting at $49.” Then there will be two seats per plane at $49 and everything else on the plane will be $109 at a minimum.

PG: The other interesting thing in the news is that Delta is no longer going to apply an expiration date on its frequent-flier miles. It used to be that if you didn’t fly within three years of earning miles you lost them. Then the airlines said if you didn’t fly within 18 months of earning miles they would expire. Then it got down to 12 months. And finally, Delta said, OK we’re no longer going to do that.

CM: I think is a great thing for infrequent travelers. People that maybe have retired, and they’ve been sitting on a bank of miles that they want to use. Or people that may have banked up a lot of Delta miles, but moved away from hub cities like Atlanta or New York and don’t fly Delta as much. But for truly frequent travelers, which is what these programs are all about, it’s not that big of a deal.

The latest on airline loyalty programs:

Delta Plane - Delta Ends Expiration Dates For MilesI think that the reason Delta did that was really for public relations. They’re getting ready to do a big battle in Atlanta with Southwest Airlines.

Southwest has just come out with a revised frequent-flier program that rewards people who spend more, not necessarily fly more. But their miles do expire after two years.

If Delta needs some kind of ammo to go after Southwest, they can say, “well our miles don’t expire and theirs do.” It will be one extra thing that they can use in the battle in Atlanta. And it’s going to be a big battle.

Find out why Southwest & Delta will be battling in Atlanta: What Airline Consolidation And The AirTran-Southwest Merger Mean For Customers.

PG: Here’s the untold story here: If the airlines are flying with 87 percent of their seats effectively filled, they’re flying effectively full. There is no incentive from the airlines to basically displace revenue passengers by giving out a frequent-flier ticket to begin with. So it’s very easy for then the airlines to say, hey your miles will never expire, because  they know you can also never use them.

CM: That’s true.

PG: The little-known thing about frequent-flier miles is that you can actually will your miles. So instead of almost dying trying to redeem miles in your lifetime, you can give them to someone else and let them die trying!

By Peter Greenberg for Peter Greenberg Worldwide Radio.

Related links on