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Etihad Airways captured the imaginations of award travelers everywhere last year when it announced the launch of its A380 Residence, and the airline won even more hearts this past winter when it decided to honor one of the best mistake fares we’ve seen recently. Etihad may now be cashing in some of that goodwill after recently announcing some changes to the Etihad Guest program.
Citing increased demand for seats (particularly in premium cabins) and the need to ensure that the program remains “attractive, competitive, and sustainable,” Etihad will alter award and upgrade redemption rates, award availability, mileage earning rates and surcharges for bookings made on or after July 8, 2015. If that sounds like a prelude to a bitter devaluation, don’t worry; while some of the changes are definitely for the worse, the news isn’t all bad.
Etihad is raising some award redemptions while lowering others. Here’s how the changes break down:
- Economy awards will decrease for flights of 6,000 miles or more, and will remain the same for other flights.
- Business-class awards will remain the same for flights of 6,000 miles or more, and will increase for other flights.
- First-class awards will increase across the board.
For example, TPG Contributor Richard Kerr’s recent first-class trip from Tokyo to Abu Dhabi would currently cost 81,373 miles, but will cost 107,725 miles after July 8. That’s an increase of about 32%. On the other hand, a one-way economy award from Abu Dhabi to Los Angeles currently costs 76,240 miles, but will cost only 57,180 miles after July 8.
Upgrade rates will also increase in most (but not all) cases, and some have actually decreased. For example, upgrading from Pearl Business to Diamond First from Abu Dhabi to New York would currently cost you 53,000 miles, but that cost increases to 62,439 miles after July 8. However, upgrading a B, H or Y fare to Pearl Business on that same route will cost 41,626 miles after July 8 versus 53,000 miles now.
On a positive note, while Etihad is increasing the cost of many business-class awards, the airline also recognized how popular those awards are, and is increasing availability by 20% on some of the highest-demand routes. Etihad claims this will result in “around 1,000 additional award seats in Business Class each month on popular routes.”
Additionally, Etihad specifies that there will be a minimum of five GuestSeats available in economy class on every flight. That’s good news for award travelers who aren’t interested in premium cabins, since the difference in cost between saver-level GuestSeats and standard-level Freedom Seats can be staggering.
Mileage Earning Rates
Etihad is adjusting mileage earning rates for several fare classes. As shown in the chart above, rates will increase for five fare classes and decrease for two (E and Z fares). I hate to see any cuts to mileage earning, but there’s not much to complain about here.
Etihad currently adds fuel surcharges on some awards into Abu Dhabi. While those are going out the window, the airline will introduce a new “carrier charge” for all GuestSeat bookings. The charge is calculated based on the number of sectors and your flight class:
- Economy Class — $50 per sector
- Business Class — $100 per sector
- First Class — $150 per sector
Etihad provides the following example:
- A return Economy Class GuestSeat from Abu Dhabi to London: $50 each way = $100
- A return Economy Class GuestSeat from Sydney to London (via Abu Dhabi): $50 x 2 segments in each direction = $200
Depending on which routes you’re interested in, these new charges might end up being more costly than the new mileage requirements. This is pretty disappointing, especially since (much like fuel surcharges) these charges don’t correlate to any real cost, and are just a way for the airline to squeeze a bit of cash out of award travelers.
I cringe any time I hear an airline is planning to alter its award chart, but overall these changes could be much worse. Etihad Guest still offers good value on many awards, and remains one of the best uses of Citi ThankYou points. While the more aspirational awards are becoming more expensive, economy award travelers will have things a little easier.
In the coming weeks I’ll discuss these changes (and strategies for working with them) in more detail. In the meantime, I look forward to hearing from you, so please share your thoughts in the comments below.
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