[CCO Out, Brutal Miles Plan Canceled, Lower Fares Returning To Portals] American: Bag Fees Going Up And You May Have To Book Direct To Earn Miles And Elite Status

Never Miss Another Deal - Follow DansDeals on Facebook

Update, 5/29: AA CCO Vasu Raja, who has been with the airline since 2004, is no longer with the airline. He made an ill-fated big bet on selling fares without discounts directly to consumers and closing their corporate sales team.

CEO Robert Isom announced today that the airline will continue to award miles, even if you buy flights from non-preferred travel agents, rescinding the previous edict made in February. The airline will also restore their lower fares to all agents and booking portals and will work to earn back corporate business that had fled to Delta and United.

Raja was also behind the ending of American’s valuable business program. No word yet if the new business program will be improved.

It’s always great to hear good news from the airline, but it’s even more satisfying to know that airlines can’t just continue to squeeze passengers and hope that they won’t react to negative changes.

HT: Leon F. via Gary Leff

Originally posted on 2/20:

American Airlines announced a number of passenger unfriendly changes today.

Somehow, this is supposed to be rewarding my loyalty? Gotta love marketing spin…

Airlines have long awarded miles regardless of where you book. That compared favorably to hotels, which typically only offer points and elite status benefits when you book directly on their site.

Until now.

Effective for tickets issued on 5/1/24, AA will only award miles and loyalty points when you book directly with AA and partner airlines, and with “preferred travel agencies.”

DansDeals reached out to American for clarification on what that means, and American responded that they will publish a list of preferred travel agencies on AA.com in late April.

If Expedia, Priceline, AMEX, Chase, Capital One, and Citi are not “preferred travel agencies” it will be a brutal change. Of course, this is also bad news for physical travel agents if they are not listed as preferred.

Preferred agencies will be evaluated based on how quickly they transition to NDC (New Distribution Capability) and what percentage of their tickets are sold via NDC, with rising targets to hit. You can read more about NDC from Cranky Flier here and here. Agencies will be reevaluated every 6 months to determine if they qualify as preferred.

Basic economy fares with only earn miles and loyalty points when you book with AA or partner airlines.

There is one very notable exception. If you are an AAdvantage Business member, you will continue to earn miles and loyalty points on all fares, anywhere you book. 

I wrote about the AAdvantage Business program last October.

Businesses will need to have 5 active registered travelers, $5,000 in flights every rolling 12 months, and a tax ID number to enroll. However, new Citi® / AAdvantage Business™ World Elite Mastercard® will be automatically added to the program, even if they don’t meet those ongoing criteria. Existing cardholders will be enrolled in AAdvantage Business this year.

Enrolled businesses booking directly with AA will earn 1 AA mile per dollar spent, which can be transferred on demand to employees of the business. Those are on top of regular mileage earnings for employees. Enrolled employees will also earn 1 bonus loyalty point per dollar spent when booking directly with AA, on top of the normal loyalty points earned for travel.

But even if you don’t book directly with AA, enrolled employees will still earn regular miles and loyalty points no matter how they book travel.

That’s a big pretty big advantage for having a Citi AAdvantage Business Card.

American is also increasing bag fees, matching recent increases from Alaska and JetBlue.

Domestic first checked bag fees will now cost $35 when purchased online or $40 when purchased at the airport. Second checked bag fees are $45 online or at the airport. The first domestic checked bag is still free for AA cardholders.

Canada and short-haul international bag fees are $35 for the first bag or $45 for the second bag online or at the airport.

American will also create a new category for slightly overweight and oversized bags. Bags from 51-53 pounds will cost $30 instead of $100. Bags from 62-65 total linear inches will also cost $20 instead of $100. Practically speaking, most agents waived the fees for those bags and will likely charge for them now, so I consider this to be a worse policy.

On the positive side, bags that are both oversized and overweight will only pay 1 fee instead of 2, so there’s that.

Other changes include:

• Transfer miles to another member for 0.5 cents instead of 1.5 cents each.
• Starting later in 2024, use miles to pay for WiFi.
• Starting later in 2024, use miles to pay for upgrades on select partners airlines
• Only AA members can cancel basic economy tickets for a fee.
• Only AA members can go standby for free as of 3/1.
• Starting 3/11, AA members will get 18 months to use trip credit, up from 12 months.

What do you think of these changes? Will other airlines follow suit or will they take advantage of less onerous rules?

HT: theyankel, via DDF and lakewood34