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TPG contributor Mark travels the Middle East and India for his work and has the inside scoop on the frequent flyer programs for several airlines based in that part of the world. Whether you decide to join one of these programs or not, it’s an interesting look at how frequent flyer mile programs vary by region. Here he explains the basics of Etihad’s Guest Programme.
Airlines based in the Middle East are consistently ranked as some of the best in the world thanks to some of the youngest aircraft fleets in the sky, the newest onboard products, and mileage programs designed with the contemporary traveler in mind.
In this post, we’ll take a look at one such airline, Etihad (which was named the World’s Leading Airline at the World Traveler Awards in December 2011), its Etihad Guest Programme and what frequent flyers can get out of it.
Etihad’s hub is in Abu Dhabi, a capital city of United Arab Emirates. It currently serves JFK and Chicago O’Hare in the US. Even if you are not traveling to Abu Dhabi, but are planning trips to over 50 cities they serve in Asia, Africa or Australia (or exotic destinations like the Seychelles or the Maldives), you should think about establishing an account with the Etihad loyalty program here.
Etihad just changed its earning rates as of April 1, 2012. Except for discount economy fares, the miles earned and bonuses are pretty decent, especially on full-fare tickets (250% on first class!). They are now as follows:
Coral Economy Class
-Fares E U V L Q M K: 50% of miles flown
-Fares H B Y: 100% of miles flown
Pearl Business Class
-Fares W D: 131% of miles flown
-Fares C J: 175% of miles flown
Diamond First Class
-Fare R: 188% of miles flown
-Fares A F: 250% of miles flown
Redemptions for a flight can be made using miles or the Miles + Cash option. You can find a mileage calculator for how many miles you will need here. There is a slight glitch with the calculator when you try to determine how many miles you need to fly from the US. Etihad is working to fix it, but for now the quick fix is to reverse your route to find the mileage. So if you use JFK or Chicago as your destinations, and your destination elsewhere in the world as your origin, it will calculate the correct amount of miles required. Minimum mileage requirement for a roundtrip from JFK to Abu Dhabi is 124,706 in economy—pretty steep!—176,781 in business and 222,000 in first plus $7 in fees. You can get one-way redemptions for half the miles required for roundtrip. We’ll get into how to book awards as well as fees in a future post.
Because the award redemptions are pretty high, for the best value, I recommend using Etihad Guest miles for upgrades. There are a number of inexpensive tickets to many destinations, and the best value for using your Etihad miles is to redeem them for upgrades with inexpensive coach tickets. I’ll get to that in another post, but to take a quick example, a one-way coach ticket from JFK-Abu Dhabi next week is $963, while business is $7,179. To upgrade using miles would take around 53,000 miles each way and no fee, meaning the miles you’d use would be worth a jaw-dropping 11.3 cents each!
• No blackout periods – Seats are available on all flights, and if a seat is available, you can book it. However, while the low mileage redemption for one-way coach from JFK to Abu Dhabi is 62,353, a high-level redemption could be as high 350,000 miles for coach! That said, there is often last-minute availability at lower levels, but you should book in advance to popular destinations like Seychelles and Maldives
• Anytime availability – All seats, including the very last seat, are available at any time, even one hour before departure at the airport. The only fee in addition to miles is $7.00 tax in the US or 150 Drh (about $40) in Abu Dhabi.
• Miles + Cash – Decide how many miles you want to use (although the airline doesn’t explicitly say so, when you’re looking at this option with the mileage calculator, you need to have at least 75% of the miles required for redemption) and contribute the rest in cash using the Miles+Cash feature. You still earn miles on the actual cash spent on flights. I’ll get into this innovative (for the airline industry) option in a future post, but to take an example, if you want to book a one-way from JFK to Abu Dhabi that requires 62,353 miles, but you want to use only 46,765 miles, 75% of the required miles, the cash portion of the ticket is automatically calculated on the web site and is $140, plus $7 tax, basically allowing you to buy 15,585 needed miles for approx .9 cents/mile, which is a very good deal.
There are three levels of membership. I’ll get into the details for each in a future post, but for now, here are the basics.
Silver: Qualify after 25,000 actual miles flown within 12 consecutive months, rather than a calendar year (a great feature). To maintain status, you will need only 20,000 miles the following year. You get a 25% bonus on Etihad Guest miles earned. You are guaranteed an economy seat within 48 hours, even if the flight is sold out. Once you qualify for at least Silver status, you qualify for a one-class upgrade on flights full in the class of service in which you are booked I always purchase the least expensive class of service, and have been upgraded on many Etihad flights for free, especially for flights originating from India. If you do not get an upgrade, but have enough miles for an upgrade in your account, Etihad flight attendants have access to your account on board and can process an upgrade on the plane. I do not understand why other airlines are not able to do this, but maybe once they are given laptops or iPads to be used onboard, I hope we will be able to have this feature on more airlines in the near future.
Gold: Qualify after 50,000 actual miles flown within 12 months, and fly 40,000 miles to maintain the status. 50% bonus on Etihad Guest miles earned. Guaranteed economy seat within 24 hours, even if the flight is sold out.
Gold Elite: Qualify after 125,000 miles, 100,000 miles to maintain the status in the following year. Still 50% bonus, but another family member of your choice gets a complimentary Silver status. Guaranteed economy seat within 12 hours, even if the flight is sold out.
For US travelers, the most important partnership Etihad has is with American Airlines. Flyers can accrue and redeem American Airlines miles on any Etihad flights. Travel ticketed as an AA-marketed flight (booked as an AA codeshare flight number) and operated by Etihad Airways (including travel between New York and Chicago to Abu Dhabi) will earn AAdvantage base miles and elite qualifying miles, points and segments according to the AA earning structure.
To take a few examples. Using American miles to fly roundtrip from JFK or Chicago to the Maldives or to India would require 90,000 AA miles plus $63.50 in coach, or 135,000 miles in business, whereas using Etihad miles from JFK to the Maldives would take 159,049 miles in coach, 225,465 in business and 283,142 in first plus $7; and using Etihad miles from JFK to Mumbai, India, would cost 147,219 plus for a coach redemption, 208,695 miles for business or 262,082 in first plus $7. Mileage required to different Indian destination will vary slightly, as miles required for Etihad tickets is calculated based on distances between destinations–so here is a chance to pull some real value out of the partnership since AA calculates its awards based on zones while Etihad bases theirs on the distance of the flight segments. That trip to the Maldives could save you around 90,000 miles using AAdvantage instead of Etihad Guest Programme!
You should also be aware that to redeem Etihad Guest miles for reward flights on American Airlines; members must contact the Etihad Guest Service Centre a minimum of 14 days prior to their intended travel date.
Effective January 15, 2012, you can also earn and redeem miles on airberlin, one of the leading European discount airlines, which is also joining Oneworld in March. Etihad bought equity in airberlin, and it’s reasonable to expect for Etihad to invest in other airlines as the industry continues to consolidate, meaning Guest Program redemption opportunities are only going to increase.
Etihad Guest lets you pool all of the Etihad Guest Miles earned by anyone in your family into one single account and benefit from the added flexibility of a Family Membership. You can nominate yourself as Family Head here and choose up to 8 family members in your extended “household” to join you, including children, stepchildren, grandchildren, siblings and stepsiblings, parents, stepparents and parents-in-law, nephews and nieces, even “household help.” Etihad does reserve the right to audit these relationships and threatens that it will from time to time request for documented proof of the relationships, but I do not know how they can practically accomplish this.
When any member of your family travels with Etihad or one of its partner airlines, 100% of the Etihad Guest Miles earned by the Family Guest will be transferred to the Family Head’s account, along with any bonus miles earned. You don’t need to travel together to accrue all the benefits of Family Membership. Family Guests enrolled in a Family Membership continue to receive 100% of the Etihad Guest Tier Miles they earn and carry on receiving all their personal tier benefits.
They’ll also be eligible for promotion to Etihad Guest Silver and Etihad Guest Gold, and all of the benefits of membership of these exclusive premium tiers. Family membership should be considered by US airlines to encourage family members to be loyal customers of the airline of choice of the head of the family. Increasing numbers of parents are financing the travels of their grown children in today’s economy, and a family membership would enhance brand loyalty.
Passengers flying in business and first class receive door-to-door luxury limousine service, complete with a personal chauffeur. You can enjoy Etihad Chauffeur in more than 25 cities worldwide listed here, with more services rolled out regularly. You need to request the car at least 24 hours in advance of your trip. You will not be able to use the limo if you received an upgrade to business using miles.
INITIAL THOUGHTS With some great bonus categories and an annual fee that’s waived for the first year, the American Express Premier Rewards Gold Card has a lot going for it. If you don’t have PRG, now’s as good a time as any to add it to your wallet, as Amex added some great new benefits several months back.
I think the most innovative features of Etihad’s Guest Program are the Family Membership feature, the ability to use miles to upgrade while actually on board, the Miles + Cash feature and ability to earn miles on the cash portion when Miles + Cash option is used. Additional strengths of the Etihad Guest program include the ability to qualify for status during any 12-month period instead of a calendar year, lower mileage requirements to maintain elite status once it has been earned, as well as the guaranteed economy seats for premium flyers. On the downside, many of their redemption opportunities to and from the US require rather high mileage figures, but all in all, other airlines would increase their capacity to build brand loyalty were they to adopt some of these features. I hope Etihad starts to fly to more US destinations soon.
With some great bonus categories and an annual fee that’s waived for the first year, the American Express Premier Rewards Gold Card has a lot going for it. If you don’t have PRG, now’s as good a time as any to add it to your wallet, as Amex added some great new benefits several months back.