Let’s face it – airlines really don’t care about most of us. Yes, there may be airline employees that care about us as individuals but as a corporation, those of us who like to maximize our reward values are not important to the airlines at all.
In fact, United has taken the bold? step to make elite status be even more about spending money than flying as of 2020. But, they did take a moment to slap those same customers with a new surcharge that is on awards now. That award change is the move from no close-in booking fees to a mileage surcharge that exists for all customers, whether you are a general member without a credit card or you are a Premier 1K with the United Club card.
United’s New Mileage Surcharge Hurts Their Most Valuable Customers
So, who are United’s most valuable customers? They are those that spend a lot of money for sure (and therefore probably do not travel with awards often) but also their top tier elite members and customers who carry their premium credit card, the United Club card. It is these last two kinds of customers that the new award surcharge hurts the most.
Back in April when the United award changes were announced, I wrote about two credit card perks that United would need to do something about. So far, the perk of expanded availability still exists so that is good. But, the close-in booking fee waiver available to United Club card members and top tier elites (Premier Platinum and Premier 1K members) is now gone since United eliminated the $75 fee with their award changes.
The Sneaky Mileage Surcharge for ALL Customers – Even Elites and Premium Cardholders
In place of that $75 close-in booking fee, United now has added mileage surcharges which are a minimum of 2,000 miles more (averaging at around 3,500 miles) for award trips booked within 30 days of departure. The kicker? That new mileage surcharge is levied at all customers – including United Club card holders and Platinum and 1K customers.
This was a bad move by United to make after talking about how great it was they were removing the fee – only to replace it with miles (which I theorized back in April would happen). But, it is even worse for those valuable customers of United as they now need to pay it as well and one of the key award perks of their status/card no longer applies.
What Will Chase Do?
What will Chase do with the United Club card to replace the lost benefit?
While Chase has (rightly) taken that close-in booking waiver off the list of benefits for the United Club card, United still has that waiver as a perk for Platinum and 1K members on their website.
This new change materially changes the United Club card with a removal of a feature that many people treasured. For example, Lufthansa First Class awards can only be booked with United miles within 14 days of departure. That means anyone that wanted to use United miles for those awards always had to pay the $75 booking fee – unless they had the United Club card (or high tier status).
No Fee = Loss Benefit
True, that fee is now gone and United could claim some kind of other excuse to dispute that the mileage surcharge is a replacement. But, the fact is that no members pay an actual fee now so this is something that many United Club card holders may have used that now reduces the effectiveness of a card that has a $450 annual fee.
I think that Chase and United should do one of two things (or something better!) to replace that benefit:
- Give a rebate on mileage redemptions, maybe up to 15,000 miles back per year (which would be appropriate since a much lower fee AA card used to give 10K miles back)
- Give change fee waivers on awards, maybe up to like 4 per year or something similar
One of those two features would continue to provide some award value for those United Club card holders. For elite members? Well, we will have to see what United does but my guess is they don’t give them a single thing to replace this.
Hey, United, stop blaming Chase for people not using your credit cards. It is things like this that make your cards worth less all the time.
United gets a ton of money from their relationship with Chase for credit cards and when they pull stuff like this, it damages their relationship with cardholders and potentially Chase as well. Hopefully, they get that message and finally give cardholders something of value – besides Global Entry reimbursement.
Are you a United Club Card holder? Was the close-in booking fee waiver a feature you used?
Featured image courtesy Jorg Hackemann : Shutterstock.com
United’s top customers are the ones who spend the most with the airline.
Then there’s everyone else.
This was a B.S. move on United’s part. Good of you to call them out on it.
The close in booking fee was really annoying and killed the value of the close-in award…which is maybe the intent. Really disappointed with this item, as well as the overall devaluation. I split my travel between UA and SWA over the last few years, buying discounted first on all of my UA travel when I had a close-in travel need. (making gold each year, which doesn’t really matter when buying first) I was really happy with the program and the partner awards. As we knew that the devaluation was coming, I burned the 500K miles that I accumulated, dumped the UA credit cards and club membership, and am pretty much on SWA going forward. Sitting on an SWA flight as I type this. I really do wonder sometimes how closely they track people’s behavior/loyalty.