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It was a big week in airline news with Delta’s announcement that they’re going to fundamentally change the way that flyers earn SkyMiles and, potentially, the way that we redeem them. I’ve been receiving a lot of questions about Delta and its alliance with Alaska.
TPG Reader Josh asked on Twitter:
“@thepointsguy Question – how does Alaska Airlines make money if I fly AA, DL and BA, then credit my miles to them and redeem with them?”
And TPG reader Ashker asked on Facebook:
“I am a Delta Platinum Medallion and currently earn 2X miles the distance flown. After today’s announcement from Delta, I’m thinking about depositing my miles into Alaska MileagePlan instead, where I don’t have any status. So, would I be earning 1X mile there or 2X miles?
Also, is it possible to earn Qualifying miles in one airlines (e.g Delta) and redeemable miles in another partner (e.g. Alaska)?”
So first to answer Josh’s question. When you pay one airline for your ticket but bank the miles to a partner, the airline you actually pay/fly must pay their partner for the miles you bank. Alaska members will redeem for Delta flights, Delta members redeem for Alaska, and at the end of the year, if there’s a disproportionate balance there’s a cash settlement between the two airlines. However, the price they pay for miles is not remotely the same price we pay for miles. Airlines mutually agree upon a price so that each partner is making money when the other is banking miles, and vice versa.
As for whether or not you can transfer your Delta SkyMiles into Alaska miles, the simple answer is no. Generally, you can’t transfer your existing miles with one program into another mileage or point currency without doing so at a horrible transfer rate. They’ll certainly allow you to switch, but you’ll get nailed on the conversions. This is why you need to be informed about different mileage programs, and carefully consider which program will give you the most value when deciding where to bank your miles.