American to keep reward program features after US Airways merger

Starting next year American Airlines will absorb US Airways Dividend Miles members into its AAdvantage program

The merger to create the world's largest airline took a key step Tuesday as American Airlines announced plans to keep most of its loyalty rewards program features when it combines with US Airways and avoid a controversial change taken by its biggest competitors.

Starting next year, American Airlines will absorb members of the US Airways Dividend Miles program into its popular AAdvantage rewards program, and will continue to distribute reward points based on miles and segments flown — not on dollars spent.

By sticking with its miles-based system, American avoids the criticism that Delta and United have taken for announcing plans to switch next year to dollar-based systems that typically benefit high-spending travelers in first-class seats.

For now, the changes suggest that American is focusing on completing the merger with US Airways next year without creating drama that could rile loyal fliers.

"There are always going to be winners and losers," said Brian Kelly, founder of ThePointsGuy.com, a website that analyzes reward programs. "The big picture is that American had the opportunity to make broad changes and they didn't."

It's likely, said Kelly, that American decided to stick with its existing program to stand out from its competitors.

United plans to switch to a dollar-based reward system March 1, 2015. Delta will switch to a similar plan Jan. 1. A study released this year by Boston flight research site Hopper.com found that United fliers will earn 11% fewer reward points and Delta passengers will earn 22% fewer miles under the new dollar-based system.

American's AAdvantage program is one of the nation's oldest airline reward programs, with 75 million members, compared with 35 million at US Airways' Dividend Miles program.

"The safe thing to do is to take the biggest of the two programs and keep it the same," said Brian Karimzad, director of Milecards.com, a website that tracks and analyzes travel reward programs.

Members of US Airways' Dividend Miles program will automatically get an AAdvantage account, with their points converted on a one-to-one exchange.

Still, some changes to the program have drawn criticism from members of US Airways' loyalty program.

Under the current US Airways program, all elite status members get seat upgrades on all flights, when seats are available. But when the reservation systems for the two airlines are combined next year, the seat upgrades will be limited to flights of 500 miles or less, except for the top-tier members. To get seat upgrades for flights over 500 miles, Gold and Platinum members must either buy or earn upgrade rewards.

Also, the threshold to earn top status — Executive Platinum — will increase from 100 segments flown to 120 segments, starting Jan. 1.

On social media sites, American took a barrage of criticism from US Airways loyalty members who complained about losing perks in the merger.

"Bad news for every US Airways Dividend Miles member," James Lilley, an account manager from Chandler, Ariz., wrote on US Airways' Facebook page.

American Airlines officials acknowledged that the changes will anger some fliers.

"It's tough to please everybody," said Suzanne Rubin, president of the AAdvantage loyalty program.

hugo.martin@latimes.com

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