Air Canada’s New TD Aeroplan Visa for US Cardholders

Feb 20, 2015

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Today, TPG Senior Points & Miles Correspondent Jason Steele looks at a new credit card option for earning mile in the Air Canada Aeroplan program.

Air Canada’s Aeroplan program has long been one of my favorite ways to book Star Alliance award flights. While you might not fly Air Canada often, there are several options for earning Aeroplan miles: you can bank flights on United Airlines to Air Canada, or you can transfer points to Aeroplan from American Express Membership Rewards or Starwood Preferred Guest. However, you can now also earn Aeroplan miles with a new co-branded credit card explicitly for American citizens and residents.

The recently launched Aeroplan Visa Signature card from TD Bank offers , and has no annual fee for the first year. Today I’ll look at what makes the Aeroplan program useful to US award travelers, and discuss whether this new card is worth considering.

Aeroplan overview

Aeroplan is a member of the Star Alliance, and has several non-alliance partners in small, regional Canadian carriers like Air Creebec, Bearskin Airlines, Canadian North , First Air, and Calm Air. Air Canada publishes an award chart with the standard award prices (remember when all airlines did?), but they also have a Flight Rewards option that is revenue-based. This means that flights operated by Air Canada are available at higher mileage levels that are based on the current fares.

Also, Air Canada offers Distinction Flights from Canada to select destinations, where 100% of the seats are reserved for Distinction members at the lowest mileage levels. For example, Aeroplan is currently offering Distinction Flights from Toronto and Montreal to Cancun and Punta Cana in March.

While these revenue-based options are never a very good deal for premium class awards, they can make sense for economy awards sometimes. Furthermore, Air Canada offers discounts for members of the Distinction program. Silver members receive up to 20% off and Black members receive up to 25% off, but Diamond members receive a whopping 50% off.

Even if you don’t fly Air Canada often, you can put Aeroplan miles to good use.

Award Chart Sweet Spots

With miles from so many Star Alliance carriers available through the major flexible point transfer programs, what makes Air Canada so attractive that you might consider their co-branded card? Here are some of the best ways to get value from the Aeroplan program:

1. Short haul flights on Air Canada. Have you ever noticed that many small and medium sized airports in the Midwest are called “International” by virtue of offering a single flight to Toronto on Air Canada? While these flights tend to be very expensive, many of the shorter ones are available at a discount with Aeroplan miles, costing just 7,500 miles each way or 15,000 miles round-trip in economy class. Eligible destinations from Toronto and Montreal include cities in Connecticut, Georgia, Illinois, Indiana, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, New Hampshire, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, Tennessee, Virginia, Washington DC, and Wisconsin.

2. “Europe 1” in business class. For some reason, the Aeroplan award chart divides Europe into two zones: Europe 1 and Europe 2. There’s little rhyme or reason to the division, other than that Europe 1 tends to be western Europe and Europe 2 tends to be eastern Europe. Nevertheless, a round-trip business class award is only 90,000 miles if you’re traveling to Austria, Belgium, Denmark, France, Germany, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Spain , Sweden, Switzerland, or the United Kingdom. At 105,000 miles round-trip in business class, Europe 2 isn’t a terrible option either.

3. Partner awards with no fuel surcharges. Other than United and Avianca/TACA, all the Star Alliance carriers add fuel surcharges to awards when those surcharges are imposed by the operating carrier. Thankfully, Air Canada only adds fuel surcharges to some of its partner award flights. The exceptions are Air China, Brussels, EgyptAir, Ethiopian, EVA Air, Scandinavian, Singapore, Swiss, Turkish, and United. In addition, fuel surcharges on LOT Polish are very low.

You can book certain first class awards with no fuel surcharges using Aeroplan miles.

4. First Class awards with no fuel surcharges. Of the airlines that are offered with no fuel surcharges, Air China and Singapore offer a first class option (Swiss flights in first class are not available as awards). While these awards are not cheap (210,000 and 215,000 miles for Asia 1 and 2, respectively), they’re much cheaper than United, which costs 260,000 miles for the same seats with no fuel surcharges.

5. Infant lap child awards. One of the biggest rip-off fees, even worse than fuel surcharges, is the lap child fee of 10% of the ticket price, often based on the highest price of an unrestricted ticket. Nearly all airlines charge this ridiculous fee just to carry infants under two years old on a parent’s lap. Thankfully, Air Canada is one of the rare exceptions, charging $50 (or 5,000 miles) for economy, $100 or (10,000 miles) for business, and $125 (or 12,500 miles) for first. If you ask me, this is still more than it should be, but at least it’s in the right ballpark. And at just one cent per mile, I’d probably rather pay in cash than use up my miles. Note that these prices apply not just to award flights on Air Canada, but to any partner award ticketed with Aeroplan miles.

6. Reasonable one-way, stopover, and open jaw policies. A few years ago, Air Canada was known to have some of the most generous routing policies, but those days are gone. Still, it offers reasonable policies including a stopover or an open jaw on flights within North America (not including Puerto Rico and Hawaii). One open jaw and one stopover, or two stopovers are permitted on flights that include a Star Alliance partner. Few award programs allow two stopovers anymore. See Maximizing Stopovers and Open Jaws.

Furthermore, Air Canada used to charge more than half the price of a round-trip if you wanted to book a one-way award, but they now charge 50% of the round-trip price (although you lose your ability to make a stopover when you fly one-way). This doesn’t sound like a big deal, but I often have to piece together one-way awards from multiple programs. To my frustration, there are programs like US Airways that still only allow round-trip awards, so the fact that Aeroplan won’t charge you extra for a one-way is a plus.

7. Reasonable fees. One of the big issues with many major airline programs is the excessive change and cancellation fees imposed. Aeroplan allows cancellations up to two hours before departure, and changes can be made for $90 CAD (~$72 USD) per ticket. If this doesn’t sound that great, consider that Delta charges Gold, Silver, and non-elite members a change fee of $150, and there are no changes at any price within 72 hours of departure. Ouch!

TD Aeroplan card banner
Unlike most Aeroplan cards, this one is for United States citizens and residents.

Now that you know more about the value of the Aeroplan program, is this new card worth getting?

TD Aeroplan Visa Signature Card

Current Bonus: 25,000 bonus miles after you spend $1,000 within three months of account opening.
Benefits: Cardholders earn double Aeroplan miles on all Air Canada purchases, and one mile per dollar spent elsewhere. Aeroplan Miles can then be redeemed for award travel, as well as other (less lucrative) entertainment, merchandise and gift card options. The card also has Visa Signature benefits like complimentary 24/7 concierge service, access to events, special shopping perks and more. The miles earned from spending on this card also count toward Distinction status in the Aeroplan program (though the sign-up bonus does not).
Annual fee: $89, waived the first year.

This card is explicitly for United States citizens and residents, but of course there are Aeroplan cards for Canadians as well, including the American Express AeroplanPlus Gold Card and the American Express AeroplanPlus Platinum Card.

My Thoughts

While 25,000 miles is not a very competitive sign-up bonus these days, this card does have several things going for it. First, it’s one of relatively few credit cards that can help you earn a big chunk of Air Canada miles at once. You can also get sign-up bonuses for cards that earn Membership Rewards (like The Platinum Card or the Amex Everyday Card) or Starpoints (like the Starwood Preferred Guest Card from American Express), both of which transfer to Aeroplan. However, this card is offered by TD Bank, so if you’re already tapped out on Amex cards, this one should be easier to get.

Spending with this card will help you earn status in Aeroplan’s Distinction program; however, note that Distinction is very different from the Air Canada Altitude elite program. There are three levels of Distinction status that are earned by accumulating miles directly through the Aeroplan program and its partners. Distinction elite Silver status starts at 25,000 miles earned in a calendar year, and offers discounts on Market Fare (revenue-based) awards, as well as mileage bonuses for certain qualifying flights and hotel stays.

As a Visa card, this is the only card that earns Aeroplan miles at merchants that don’t accept American Express. It also includes some useful Visa Signature benefits, though there are definitely superior Visa Signature cards out there (like the Chase Sapphire Preferred, for example). Finally, this card has a relatively low minimum spending requirement of $1,000 to earn the sign-up bonus. And of course, with annual fee of $89 waived for the first year, there’s no charge to try it out and see if it’s a good fit.

All that said, unless you spend a lot on Air Canada flights booked directly with the airline, I think you’d be better off with one of the other cards mentioned above. As with all airline partners, when you transfer 20,000 Starpoints to Aeroplan, you get 5,000 bonus miles. That means if you transfer points strategically, you’ll earn at an effective rate of 1.25 miles per dollar spent on the Starwood Amex. Even better, you can take advantage of some of the bonus spending categories offered by Membership Rewards cards to earn at an even faster rate.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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