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Barclaycard Credit Card Contract With US Airways and American Extended Through 2017

by on January 17, 2014 · 32 comments

in American, Barclays, Citi, US Airways

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One of the major points of speculation surrounding the American Airlines-US Airways merger has been what will happen to the US Airways Mastercard issued by Barclaycard once US Airways’ Dividend Miles program is folded into American’s AAdvantage program and whether the card will go away before or after that. Last week, Barclaycard issued a letter to cardholders saying that the US Airways Mastercard would be around for a while to come and is still accepting new applications.

UnknownBut the issue still remains that American already chose Citi as its credit card issuer through 2016, which still leaves the Barclaycard US Airways Mastercard’s future in question. However, Payment Source has reported that while Citi will remain the issuer of frequent-flyer credit cards for new combined airline, Barclaycard has agreements in place that will allow it to maintain its existing accounts under American’s branding.

Payment Source reports that during a Citi investor call yesterday, Citi’s CFO John Gerspach told investors that, “Following the planned integration of the AAdvantage and US Airways Dividend Miles frequent flier loyalty programs by mid-2015, Citi will exclusively issue new credit card accounts in support of the combined American frequent flier program.”

Until then, Barclaycard plans to continue offering the US Airways card and Barclaycard’s Managing Director of Co-Branding Partnerships, Dennis Nealon, told PS that, “We have a unique opportunity before the brands merge for us to go out there and continue to acquire new card members for the US Airways Dividend Miles program…Our goal over the period between merger and frequent flier program integration is absolutely to maximize the number of new cardholders that we can bring in.”

If the merger goes through, it will eventually mean the end of the US Airways World Mastercard.

Looks like this card will be around for a while yet.

Hopefully we can take that at face value, and it will be much less urgent to apply for the US Airways card since it sounds like it won’t be going anywhere. And unlike what just happened when Barclaycard ended its relationship with Virgin America and transitioned Virgin credit cardholders to the Arrival card, that will not be the case here. Nealon himself said so in the following statement: “We are not planning to rebrand any US Airways card member to Arrival. They will become American AAdvantage card members and they will have all the benefits that come along with that.” There’s no telling exactly when that will happen, but my guess is it will be right around the time the two mileage programs formally merge in mid-2015.

So come mid-2015, it looks like both Citi and Barclaycard will have American Airlines products on the marketplace, though Barclay’s will just be the one while Citi should still be fielding its full range of cards. Barclaycard’s contract with US Airways was also negotiated through 2017, so their new American card could be around for several years to come as well – and in fact it sounds like Barclaycard’s contract has been extended past that date to end at the same time as Citi’s so that for a while the new airline will have two issuers.

The major thing that will differentiate the two issuers is that while Citi will be able to sign up new cardholders, Barclaycard will be limited to serving its existing cardholders. No wonder they sound like they’re in a rush to create new accounts.

To me, that means there’s suddenly a new sense of competition between the two issuers – especially since Barclaycard will not be able to issue new cards after the merger and will be stuck just with its current cardholder roster, so they might get pretty aggressive about signing up new accounts between now and the final merger. It also means that the bank might be more aggressive and engaged when it comes to retaining those customers since once they’re gone, they’re gone and they can’t get them back – at least not with the same card.

So hopefully we’ll see some interesting offers, bonuses and promotions in the days and years to come as Citi and Barclaycard work out this dual-issuer situation. Eventually Citi is likely to be the winner, if not when the two issuers’ contracts with the airline expire, then perhaps even sooner if Citi and Barclaycard negotiate a cardholder hand off, though I’m not sure how likely that is.

In the meantime, if you’re looking for a way to boost your Dividend Miles account – for instance to book a Star Alliance award before March 30 or to take advantage of the program’s award chart sweet spots before they likely go away – or to bank some miles that you can count on eventually being AAdvantage miles, it’s a great opportunity to apply for a card from an issuer that’s not Citi, bank these miles and then apply for future AAdvantage credit card offers as they come up.

If you’re thinking of applying for the US Airways Mastercard, it looks like the offer of 35,000 bonus miles with first purchase and $89 annual fee waived the first year has gone away for now (if you have a working link, please send it to me and I’ll include!), so the best offer out there at the moment is the following one of up to 50,000 bonus miles.

  • 40,000 bonus miles with first purchase
  • Up to 10,000 bonus miles for completing a balance transfer within 90 days (note: you will incur extra costs)
  • Earn 2 miles per $1 on US Airways purchases
  • Earn 1 mile per $1 spent everywhere else
  • Redeem flights for 5,000 fewer miles. Reward travel now starts at only 20,000 miles
  • Annual companion certificate good for up to 2 companion tickets at $99 each, plus taxes and fees
  • Earn up to 10,000 Preferred-qualifying miles every calendar you spend $25,000 or more on purchases
  • First class check-in
  • One complimentary US Airways Club day pass every year
  • $89 annual fee not waived the first year

So I’ll be following these developments with interest, but let me know your thoughts in the comments section below.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • Justin

    Bri what value do you put on Dividend Miles right now? Thinking of getting this card for my wife (I already have it.)

    We’re booked on US Air Envoy PHL to Glasgow in August via United SA Saver and are worried about what happens after Mar 30 in case we need to make changes (she’s booked on the same flight a day before me and we’re hoping that an award seat will open up on the other’s flight.) I’m thinking it might make sense to accumulate DM to have a backup in case (in which case book US award and just change United award to different flight. Maybe return from DUB since we’ll be leaving from there in Sept.) Thanks.

  • JL100

    I just cancelled mine a few months ago, I guess it’s time to apply again!

  • US Airways Flyer

    I wouldn’t say the urgency has changed. If they’re still willing to issue multiple cards to a single person, there’s time to get two or three of these.

  • larry

    Key benefit of this card to me is the 10k EQM for $25k. I wonder what will happen to this benefit when it becomes an AA card.

  • Juno

    I know that the $99 companion certificate is only good for US/Canada but does anyone know if it’s only good for Coach fare? the fine print in Terms and Conditions did not specify. I wouldn’t mind getting this to upgrade few of my flights and take my wife along for $99+tax. Thanks.

  • mike n.

    how often can you cancel and reapply and get the bonus?

  • thepointsguy

    The terms do specifically state it’s for Coach travel: “The companion certificate is valid for round-trip coach class
    travel within and between the contiguous U.S. and Canada when the
    Primary Cardmember purchases a qualifying ticket (minimum fare purchase
    of $250 required).”

  • gtg5017

    Any idea when we can expect to be able to merge US and AA mileage ACCOUNTS? I know they say they expect to merge the programs in mid 2015, but was hoping i’d be able to merge the accounts before then. Has anyone heard anything? TPG?

  • LAKnight

    I keep my finger crossed on this one, plus the companion cert and lounge pass.

  • HikerT

    Please stop claiming the 50K link is the best offer. You are that stupid and I don’t think you are getting paid to pitch the 50K link, so why are you claiming it is the best offer? The 50K link is really a 40K link w/ annual fee NOT waived. The best offer is the 35K link + fee waived + 10K bonus at EVERY anniversary. That’s 5K better at anniversary than the so called 50K link and only gets 10K better every anniversary thereafter.

  • new

    can I cancel my current US air card and then re-apply for the card again for bonus miles?

  • TheMontaneVole

    What about the original USAir credit card from Bank of America, which can still be renewed annually? I have kept it mainly because it lengthens the average length I have my credit cards and the renewal fee is low. Is it true Barclay’s will not accept applications if you also have the previous USAir card? (Mine is relatively inactive). It is rarely mentioned in these discussions but complicates matters further.

  • HikerT

    Whoops, my bad. It looks like the 35K link may be dead, in which case you are correct that the 50K link is the best link, assuming you don’t plan to keep the card for the perpetual 10K anniversary bonus.

  • BB426

    Does anyone know what is happening with the USAirways Signature Visa card? I still have that in addition to the MasterCard and both get the 10K EQM for the first $25K spent annually.

  • LAKnight

    As a US Airways MasterCard cardholder and Citi AAdvantage Credit Card cardholder, I am not sure I should consider this is a good news or not. I always want the miles from both programs to be merged ASAP. Seems like we need to wait for another year or two for the mile merge happens. Isn’t it?

  • Diotallevi

    I was just thinking that. I have an old one with no annual fee that I keep around just because it’s one of my oldest credit cards. I picked up a second one last fall. I’m thinking of applying for another to see what happens.

  • Diotallevi

    It would be pretty cool if Barclays had airline transfer partners for their Arrival card. I thought maybe that they could work something out with the new American considering their relationship with US Airways. Citi would be the official American card, but the Arrival would have American as a transfer partner, among other airlines and possibly hotels. Yeah, I can dream…

  • Drew

    Any good links for the US Airways Business card?

  • dee seiffer

    I already have the Barclay USAirways card and have been waiting my 18 months to reapply for the Citi AA. So tempting…. my AA page has the Citi card with 50,000 miles for a $3000 min spend. $95 annual fee not waived. Does anyone know if they still hold fast to the 18 month wait? I think my time is up in April. Would be nice to have those miles sooner rather than later.

  • Pazpeaceman

    Hi dee, yeah they do. I had an acct from may 2012 and an amex citi from jan 2013 and apparently they are both in the system and the csrs tell me that I apparently can’t apply for any citi aadvantage card anymore…they are being super strict about it.

  • Pazpeaceman

    I think it shouldn’t affect your app to barclays. Barclays mainly cares about other barclays card and your #of recent apps.

  • Bobbyb

    Citi cards will not budge in my experience. They are very strict with 18 month period. But it doesn’t hurt to ask and see.

  • TheMontaneVole

    Many thanks!

  • thepointsguy

    Nothing announced yet- I expect later this year

  • Winelover

    Would it make sense to get the 10k eqm in hope that they allow to combine aand us elms for 2015 qualification?

  • ch

    In my experience, you don’t even need to cancel the first card. I applied for a second one 4-6 months after my initial one and was instantly approved so bow I have both with the 10k anniversary bonus!

  • Dan

    Great article. Thank you.

  • Jimbo

    I have a US Air Visa and recently got a Barclays US MasterCard. Both offer 10,000 preferred miles credit with $25000 purchases. Will USAir honor both preferred credits if the purchases are $25000 on each card?

  • Wildcat1

    I was wondering the same thing. Also the $25,000 spend for 10,000 PQMs and the complimentary day pass seem to be hidden terms rather than being up front like other perks (companion pass etc) why is that and where can we see these laid out so we know they are a feature for anyone signing up ?

  • Wildcat1

    With you on that (lounge cert, companion pass and 10k pqms) but then throw in the free checked bag from the AA side and you have a great card

  • Susan Wright

    Is it worth it to renew for another year and get the travel companion tix? 95.00?
    Or cancel and Re-apply later. Thanks for all of you great advice.

  • ecoop

    I have both the Citi AAdvantage card and the US Airways Barclay’s world premier and have had them both long enough to have to pay the yearly $89 fee each. Given that the points are now interchangeable, does it make sense to just cancel one of them to avoid the fee? I’m new to this generally — sounds like people below cancel and reapply for Citi cards every 18 months? I’ve had mine much longer than that and have never reapplied. What does all this switching do to your credit? Thanks in advance!

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