American Airlines was the latest US airline to eliminate their close-in booking fee last week. This was the somewhat annoying fee of $75 that most people had to pay if they booked (or changed) awards within 21 days of departure. Good news, right? Well, we will see.
American Airlines Eliminated the Close-In Booking Fee
Delta was the first big US airline to eliminate that close-in booking fee and then United did it last year. For American Airlines, they actually had the best situation with that fee. Not only did top tier Executive Platinum members get it waived but you could change your award dates for free until the departure date was within 21 days. This was much better than the other airlines since it allowed those changes for free while the other airlines charged change fees.
So, good news about getting this fee waived since you can now make award bookings within 21 days for no cost in fees. You can also make changes within 21 days of departure for free. All good, right?
…But, at What Cost?
Here’s the part that doesn’t make me jump up and down. The other two airlines to eliminate those fees? Yeah, they took more miles in exchange for eliminating those fees. Delta causes their award cost to go up in miles as you get closer to departure so you are paying thousands of miles more for that “no-fee” part. With United, they boasted about the elimination of the close-in booking fee and replaced it with about 3,000 miles per award for the ability to booking close to departure.
This is what really stinks about those replacement costs in miles for the fee – they apply even for the elites that used to get the fee waived. The airlines are not going to give up $75 a pop without being able to get something in return for it. It appears that what they want in return is the chance to clear more miles off their books with higher redemption costs.
While American Airlines has not announced anything like that, their new pricing structure on awards shows that it can cost – a lot – with many business awards. Not only that, but they have their “Web Special” awards that can offer great value but will not allow any kind of changes without paying a redeposit fee. Check out some of these award prices that Live and Let’s Fly found.
So, AA could just start making the regularly priced awards be “Web Special” awards which would require an even higher redeposit fee to change. Or, they could just charge more for awards closer to departure.
The American Airlines close-in booking fee, while annoying, was the most generous of all the US airlines. Sure, it is nice to have it be gone but what will it cost us going forward in miles? The good news is that economy seems to be immune to these hikes so far. But, it is the off-season for places like Europe so that will remain to be seen as well!