Airlines Get Serious About Nonflight Awards

Share
Copy

Put another way, a comparable room on the same night at the Biltmore would cost $119, according to SmarterTravel's sister site, Expedia. That means the per-mile value using Delta, United, and American miles would be 0.49 cents, 0.79 cents and 1.24 cents, respectively.

Similar discrepancies were apparent when test-booking stays at the Hilton Times Square and the Marriott Chicago Downtown hotels as well. In the case of the Hilton, a $399 room night would cost 94,454 Delta miles, 53,600 United miles or 36,100 American miles. And in the case of the Marriott, a $269 room cost 52,450 Delta miles, 29,550 United miles or 20,600 American miles.

American's award prices aren't just significantly lower than those of its competitors, they also compare favorably to another important benchmark, the value of miles redeemed for free flights. Although it's possible to do better -- and some savvy travelers insist you should -- the average value of a frequent flier mile used for an award flight is approximately 1.2 cents. And across a random sampling of hotel awards, American miles averaged slightly higher than that. Delta miles, by contrast, averaged just under a half penny in value, and United's miles were worth around 0.8 cents apiece.

American was also the clear value leader in rental car awards, although per-mile values for all three airlines fell well short of those for hotels.

Looking at the prices in miles for a one-day intermediate-class car rental from Budget in the same three cities, Delta's prices ranged from 13,238 at Los Angeles International Airport to 19,564 miles at New York's JFK Airport, with a Chicago O'Hare rental in the middle at 18,066 miles. United's prices ranged from 10,000 to 13,050 miles. And American's ranged from 7,800 to 10,400 miles.

Comparing the mileage prices with the daily rates quoted on Budget's website, including taxes and fees, American miles were worth the most at around half a cent each, followed by United's at about 0.4 cents, followed by Delta's at just over a quarter of a cent.

An Alternative Future for Awards Programs

A frequent flier mile is worth whatever it can be redeemed for. For now at least, a mile redeemed for a hotel stay is worth more than a mile used for a car rental. And when redeemed for hotels or cars, a mile in American's program is worth more than a United mile; and a United mile is worth more than a Delta mile.

More importantly, American miles redeemed for hotel stays are worth about as much as they are for the average flight.

Looking ahead, if American's pricing becomes the industry standard, hotel awards could become a permanent part of the airline programs' loyalty program rewards catalogs.

Tim Winship is editor at large for SmarterTravel , as well as the editor and publisher of FrequentFlier.com, and a frequently quoted expert on frequent flier programs. SmarterTravel provides expert, unbiased information on timely travel deals, the best value destinations, and money-saving travel tips.

Page
  • 1
  • |
  • 2
null
Join the Discussion
You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.
blog comments powered by Disqus
 
You Might Also Like...