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I just read a pretty interesting article in the NYT about the fierce competition between airlines to build the perfect business class seat- one that maximizes both passenger comfort and airline revenue. The piece interviews a bunch of industry execs who offer unique insight to the behind the scenes “arms race” that is going on to woo premium passengers. If you enjoy flying up front, it offers a great snapshot of what airlines have been doing to research the passenger experience and also what’s to come.
Business Class Economics
Thanks to my miles and points hobby/addiction, I’ve become accustomed to flying in business and first class at affordable prices. Even as airlines pump out more miles and credit cards offer mega-bonuses, I still take for granted the ability to go pretty much anywhere in the world in comfort. This is especially important for me as a 6’7″ traveler– coach simply wasn’t made for “people of height”. I have to imagine that if miles/points didn’t exist I would travel much less.
However, I rarely think about the economics of the business and first class cabin since I rarely pay full price for those seats. I often check the prices of the flights I take and my eyes frequently attempt to leave their sockets when I see how much airlines charge for premium seats. Let’s say you live in Boston and needed to be in London for last minute meetings this week. Paid business class flights on British Airways are going for $8,154.46!
That same exact flight can be “purchased” with 80,000 Avios and $1,153.46. Paying over a grand for taxes and fees on an award ticket is a hard pill to swallow for many in the miles/points world, but it is still amazing to see how each Avios saves you 8.7 cents, or $7,000 in total.
The value here could be multiplied as well if you have the British Airways Visa and the Travel Together award that comes along with $30,000 in spend- you could get two of these tickets for the same 80,000 Avios and double the taxes/fees ($2,306), so $16,308 in travel for 80,000 Avios and $2,306, each Avios saving over 17.5 cents!
Clearly the downside is that there needs to be award availability and that won’t always align with your trip, but still, business owners should get in on the points game because maximizing points for premium travel can save huge amounts on the bottom line. I know many small business owners with millions of points, but they don’t know how to use them to save on travel and often redeem for gift cards for employee incentives. I think a lot of people assume that there won’t be award inventory at the last minute, but that couldn’t be further from the truth as many airlines unload saver level awards in the weeks/days leading up until departure.
The bottom line is that premium cabins are focus areas for the airlines and we should expect to see improvements increase over the next couple years, even on US carriers who have historically lagged behind many international carriers. That being said, airlines want to see a return on this investment so I anticipate the cost to sit in these seats will increase, even for those redeeming miles and points. In the meantime, take advantage of amazing business class redemptions before they’re gone!
5 of My Favorite Rounds Trip Business Class Awards
1) 90,000 US Airways miles for North America to North Asia (China, Hong Kong, Japan, Kazakhstan, Kyrgyzstan, Macau, Mongolia, S. Korea, Taiwan, Tajikistan, Turkmenistan, and Uzbekistan.) Even though US Airways doesn’t fly to Asia you can redeem on any Star Alliance partner, including Taipei-based Eva Air which serves Dom Perignon in business class. You can buy 90,000 US miles for ~$1,700 through their current 100% Buy Miles promotion.
2) 62,500 mile Flying Blue Promo Awards US to Europe. Taxes are high, but the cent per mile can be a great value when comparing the cost of purchasing business class. Flying Blue also includes Israel as a part of Europe, making
3) 280,000 Delta SkyMiles for a Round the World award with up to 6 stopovers.
4) 110,000 US Airways miles North America to Australia/South Pacific. Even though US Airways doesn’t fly to Asia you can redeem on any Star Alliance partner and include a stopover in Asia.
5) 50,000 British Airways Avios for Boston to Dublin on partner Aer Lingus roundtrip with only ~$40 in fees. British Airways charges ~$1,000 in fees for business class awards when you fly on their planes or most of their Oneworld partners, but not when you fly Aer Lingus or Air Berlin. Their awards are based on distances and Boston-Dublin comes in right under the threshold for 80,000 mile roundtrip awards so you can get the roundtrip for just 50,000 Avios.
The American Express Platinum card has some of the best perks out there: cardholders enjoy the best domestic lounge access (Delta SkyClubs, Centurion Lounges, and Priority Pass), a $200 annual airline fee credit as well as up to $200 in Uber credits, and mid-tier elite status at SPG, Marriott, and Hilton. Combined with the 60,000 point welcome offer -- worth $1,140 based on TPG's valuations -- this card is a no-brainer for frequent travelers. Here are 5 reasons you should consider this card, as well as how you can figure out if the $550 annual fee makes sense for you.
- Earn 60,000 Membership Rewards® points after you use your new Card to make $5,000 in purchases in your first 3 months.
- Enjoy Uber VIP status and free rides in the U.S. up to $15 each month, plus a bonus $20 in December. That can be up to $200 in annual Uber savings.
- 5X Membership Rewards® points on flights booked directly with airlines or with American Express Travel.
- 5X Membership Rewards points on prepaid hotels booked on amextravel.com.
- Enjoy access to the Global Lounge Collection, the only credit card airport lounge access program that includes proprietary lounge locations around the world.
- Receive complimentary benefits with an average total value of $550 with Fine Hotels & Resorts. Learn More.
- $200 Airline Fee Credit, up to $200 per calendar year in baggage fees and more at one qualifying airline.
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- $550 annual fee.
- Terms Apply.
- See Rates & Fees