Air Canada will sell Aeroplan miles for just 1 cent apiece: Is it worth it?
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Editor’s note: At TPG, our top priority is providing our readers with the information needed to make educated decisions about travel and rewards-earning strategy. This is not the best time to travel, domestically or internationally, as airlines have cut major parts of their route networks. But we are sharing this information to provide value for future travel once coronavirus concerns have subsided.
This article was updated on May 6, 2020, to include details on the Travel at Home promotion. The article was also updated on May 14, 2020, to reflect that the sale was extended through May 15.
Air Canada has done a pretty excellent job of helping its members during the global coronavirus outbreak. It was one of the first major airlines to extend elite status through 2021 and has given its members a plethora of ways to continue earning elite status while grounded through the outbreak.
Now the airline is back with more good news: a mileage sale. As reported by View From The Wing, starting May 7 at 10 a.m. Eastern Time through May 15 at 11:59 p.m. Eastern Time, Aeroplan will sell miles for as little as 1 cent apiece. This has the potential to be an excellent deal.
There are a couple of things to be aware of with this sale, though. But first, let’s answer the question on all of our minds: Should you buy miles in the middle of the global coronavirus outbreak?
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Should you buy Aeroplan miles now?
Regardless of how good a mileage purchase deal is, there are a couple of things to keep in mind when you purchase airline miles in the middle of the coronavirus outbreak.
The first is Air Canada’s financial position. Airlines around the world are in a tough place financially — passenger loads are at historic lows, fleets are being reorganized and some airlines have already filed for bankruptcy. Air Canada is no exception to this rule and it’s already announced that it will retire its 767 fleet and put its Rouge subsidiary “into hibernation” for three years after the outbreak is contained.
While we’re confident that Air Canada will survive the coronavirus travel downturn, there’s no way to guarantee this. This means that your Aeroplan miles could be deemed worthless if the airline goes belly up, making your mileage purchase an absolute loss.
In addition, we only recommend buying miles if you have an immediate use for them. Since it’s not safe to travel now, this means you’re buying miles for an award flight departing in late 2020 or the beginning of 2021 at the earliest. Even then, we can’t guarantee that travel will be back to normal by this time, so you should be aware of Air Canada’s change and cancellation policies before you buy miles to book a ticket.
Finally, you should also be aware of issues that have been ravaging Aeroplan in recent months. Air Canada recently reacquired the Aeroplan loyalty program and has been reworking much of its online booking platform. This has made its website extremely unreliable and — in some cases — has made online bookings impossible for some members. In turn, it’s phone lines have been slammed, resulting in extremely long hold times. Keep this in mind as you may have issues actually redeeming the miles you purchase.
Related: How to maximize Aeroplan miles
A closer look at the promotion
That said, buying Aeroplan miles at 1 cent each can be an excellent deal if you have a positive outlook for Air Canada’s future. The promotion will have three bonus different tiers that are based on how many miles it sells — here’s a look:
- The first 10 million miles sold: receive a 115% bonus (1 cent per mile)
- Next 100 million miles sold: receive a 90% bonus (1.1 cents per mile)
- After 110 million miles sold: receive a 65% bonus (1.3 cents per mile)
The prices noted above are in U.S. dollars based on current exchange rates, and U.S.-based customers won’t have to pay sales tax on Aeroplan miles. Unfortunately, Canadian Aeroplan members will be liable for paying sales tax, making miles a bit more expensive for these members.
Aeroplan lets its members purchase up to 250,000 miles per transaction and 500,000 miles per year, but bonus miles don’t count towards this limit. This means you can buy up to 1,075,000 miles through this promotion if you manage to process both transactions within the first 10 million miles sold.
Purchasing miles can help you upgrade Air Canada elite status
Air Canada recently announced a promotion called Travel at Home that lets Air Canada members earn Altitude Qualifying Miles, Altitude Qualifying Dollars and even full-blown elite status when earning redeemable Aeroplan miles from home through May 31, 2020.
You can see the Travel at Home earning chart above. The website also notes that you can earn Prestige 25K status by earning 50,000 miles with the promotion. Some ways to earn these perks include mileage transfers from American Express Membership Rewards and hotel programs, shopping through the Air Canada eStore shopping portal and spending on Aeroplan cobranded credit cards.
Mileage purchases work a bit differently, though. According to Aeroplan, half of all the miles you purchase as part of its mileage sale count towards reaching a higher status tier, bonus AQM and other perks offered.
You can register for the Travel at Home promotion on the Aeroplan website.
Is this a good deal?
TPG values Aeroplan miles at 1.5 cents apiece, so this promotion presents an opportunity to purchase miles at a half a cent lower than our valuations. Aeroplan has a standard award chart for international awards too, so you’ll get the best value by using your miles to book first- and business-class award tickets on Star Alliance carriers like United, SWISS and Turkish Airlines.
For example, you can book a round-trip business-class ticket from Chicago (ORD) to Istanbul (IST) on Turkish Airlines for just 115,000 Aeroplan miles and $47.71 in taxes. This flight usually costs around $3,800, so you’re saving just over $2,500 by purchasing miles at 1 cent each to book the same ticket. Just note that you won’t earn redeemable or status-qualifying miles on an award flight.
Do note that Aeroplan adds fuel surcharges to award tickets on Air Canada, Asiana, Austrian, Lufthansa and Thai. These can be substantial, so you’ll want to avoid booking tickets on these carriers if possible.
Earn Aeroplan miles with American Express
You can also transfer miles from American Express Membership Rewards to Aeroplan at a 1:1 ratio, so consider doing this if you already have Membership Rewards on hand and want to book an Aeroplan award ticket. Here’s a look at some of our favorite cards for earning Membership Rewards points (terms apply):
- The Platinum Card® from American Express – Earn 60,000 points after you spend $5,000 on purchases in the first three months of account opening
- American Express® Gold Card – Earn 35,000 points after you spend $4,000 on purchases in the first three months of account opening
- American Express® Green Card – Earn 30,000 points after spending $2,000 on purchases in the first three months of account opening
Aeroplan is also a Capital One transfer partner, but the ratio is 2 Capital One miles to 1.5 Aeroplan miles.
Earn points and miles on your purchase
Aeroplan charges mileage purchases in Canadian dollars, so you’ll want to use a credit card that doesn’t charge foreign transaction fees on purchases. Otherwise, you’ll be subject to a 3% to 5% fee on your purchase, which can quickly diminish the value of the sale.
In addition, mileage purchases are processed by Points.com, so you won’t earn extra with a credit card that gives bonus miles on travel and airfare purchases. With that in mind, we recommend you use a card that awards more than 1 point per dollar spent on everyday spending.
One card that fits both of these categories is the Capital One® Venture® Rewards Credit Card, that offers 2 miles per dollar spent on all purchases and doesn’t charge foreign transaction fees.
The information for the Capital One Venture has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
Featured photo by JL IMAGES/Shutterstock.
WELCOME OFFER: 60,000 Points
TPG'S BONUS VALUATION*: $1,200
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*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.
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