British Airways is currently offering a bonus of up to 25% on the purchase of Avios between now and March 23, 2014. As always, the question I’ve been getting about this sale is – is it worth it? Let’s take a look at the numbers.
Avios normally cost between about 2.8-5.3 cents apiece depending on how many you buy. With this promo, there is no bonus for buying between 1,000-4,000 Avios. When you buy 5,000-26,000 Avios, you only get a 15% bonus. If you buy 27,000 Avios – the annual maximum per account – you get the 25% bonus.
You can buy 25,000 Avios for $768, and then with the 25% bonus, you’ll end up with 33,750 Avios at a final cost of 2.27 cents apiece.
Now, mileage prices over 2 cents each don’t really get me excited. Especially because with US Airways’ frequent (though we might have seen the last of them thanks to the merger) 100% buy miles bonuses you can purchase miles at 1.88 cents apiece, and with their 100% share miles bonus late in 2013, you could have minted miles for the low, low cost of 1.1 cents each.
So 2.27 cents apiece isn’t really that great in the grand scheme of things. Not only that, but when booking Avios awards, British Airways will actually let you pay a cash co-pay instead of using all the Avios an award would normally require, and the price often works out to much lower than that – around 1.875 cents per Avios in a lot of cases like the one below, which was a recent one-way short-haul business class award. Granted, you still need the Avios to cover at least part of the trip, but if you’re just trying to buy Avios to make up for a little deficit, then it’s cheaper just to pay these cash co-pays.
However, this specific buy miles bonus could be interesting if you had particular, high-priced redemptions taking advantage of BA’s distance-based award formula. On the one hand, let’s say you wanted to use 25,000 of your Avios to book an award trip from the west coast to Hawaii. Buying those Avios at the price of 2.27 cents apiece would run you $567.50. You can often find lower fares to Hawaii, but at best, you’re pretty much just breaking even and would be subject to award availability.
On the other hand, BA awards start at 4,500 Avios one-way for flights under 650 miles or 9,000 Avios roundtrip, so purchasing those would be about $102 or $204 respectively at this price. If you wanted to use those Avios on expensive routes like New York to Montreal or perhaps some expensive intra-European ones like London-Berlin, where airfares can run into the hundreds of dollars, this could definitely be worth it. Before making the purchase, though, I would crunch the numbers on the awards you’re interested in, though, and see if it makes sense to purchase the ticket or use Avios for it instead.
I just wouldn’t purchase these Avios speculatively unless you have a specific, imminent use for them. After all, there are lots of other great ways to top up your BA account in a hurry. British Airways is a transfer partner of Chase Ultimate Rewards (if you have the Sapphire Preferred, Ink Bold or Ink Plus), Starwood Preferred Guest (and when you transfer 20,000 points you get 25,000 Avios), and American Express Membership Rewards (the rewards program of credit cards including the Premier Rewards Gold and Platinum cards) which runs fairly frequent transfer bonuses of anywhere from 20-50% (though we haven’t seen a 50% bonus in a while now).
If you don’t have a credit card with any of these programs, you could consider using this promo to top up your British Airways account at a bit of a discount, but otherwise, I’d consider transferring your Ultimate Rewards points or waiting for an Amex transfer bonus to do so.
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