Why United’s recent changes have me reconsidering going for top-tier status
Quick summary
Airlines are fighting for survival.
With passengers under stay-at-home orders and borders closed, there's nowhere to go. And even if there was, people aren't going to be nearly as comfortable as they used to be while traveling. Who wants to sit next to someone who could get them sick? When was the last time this tray table was cleaned?
With near-zero demand for travel, carriers worldwide are bleeding cash. Because everyone's grounded, the major U.S. airlines have all extended elite status for another year.
As part of these updates to their loyalty programs, Delta was the most generous across the board by giving top-tier elites an additional set of Choice Benefits next year, regardless of qualifying activity in 2020. American introduced some creative promotions like the ability to earn Million Miler status through credit card spend. And United made it easier to earn status through its cobranded credit cards (except Premier 1K).
But that was the extent of the good news from United.
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Just two weeks after extending Premier status, the carrier made it much harder to earn elite status from flying with partners. Then, the next day, UA pulled its partner award charts, as it transitions all MileagePlus awards to dynamic pricing. The very next day, we started seeing price jumps for many Star Alliance awards, an unfortunate series of events in a single, 48-hour period.
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I'm currently a top-tier United Premier 1K member. My status was fortunately extended to Jan. 31, 2022, and I even flew enough before the lockdowns to requalify for status this year under the reduced thresholds. But, now I'm not sure if it's worth going for status in 2021. And here's why.
Miles aren't worth as much
Premier 1K doesn't earn itself. In 2020, United launched a new way to earn status, primarily based on how much you spend with the airline. As part of this, it also made earning top-tier status much harder than before.
If I want a shot at 1K going forward, I'm going to need to do a significant amount of flying with United and its Star Alliance partners. As such, I'll be earning lots of redeemable miles in the MileagePlus program.
Related: Complete guide to coronavirus and airline elite status
But those miles are now worth a lot less than before. With dynamic award pricing, UA is free to set the cost of an award however it'd like. There's no limit to how much a business-class award to South Africa will cost (after all, take a look at what happened to SkyMiles when Delta went dynamic). We've even seen the erosion of the one silver lining of variable pricing, when domestic, economy awards priced below the "traditional" saver price appeared to dry up in recent days.
Even if I'm not earning nearly as many United miles from flying, I can still top off my account from my Chase Ultimate Rewards balance. Opening one or two cards is much easier than giving all my business to United.
Too hard to earn Premier status
This one's simple. The thresholds to earn 1K are much higher than they are with the competition (American Executive Platinum and Delta Diamond).
Neither AA nor DL cap how many elite-qualifying miles or dollars you earn through partner flying, like United now does.
For instance, in January I earned over 2,000 PQPs for a one-way flight in ANA's The Room business class. Had I flown that flight in the second half of the year, the PQPs I'd earn by booking through ANA would be capped at 1,500.
Related: Complete guide to United Premier elite status
There is some good news here, though. United has promised to lower the Premier-qualifying thresholds in 2021 for the 2022 status year. If the airline does lower the goalposts by enough, I'll probably hit 1K again, but it'll all depend on what flying in a post-coronavirus world looks like.
The deals are going to be great
As I mentioned in my post about United pulling the partner award charts, the timing of these changes couldn't have been worse. For one, there was no warning or advance notice at all. But more importantly, airlines are going to need to convince people to get onto planes in a post-coronavirus world.
That's why I expect to see many more deals in the second half of 2020, into 2021. Sure, if I can score some amazing Star Alliance business class fares, then I'll naturally keep requalifying for 1K, but I imagine the deals will be available on a variety of airlines.
That means I may be able to snag Qatar's QSuite for a lot less than normal. And I may as well fly Qatar's business class over Lufthansa's.
I'm positive we're also going to see more targeted promotions across the board too. In that case, I don't necessarily want to be tied to flying United if there's an amazing opportunity to enjoy a stellar product or earn other, more valuable miles by flying another carrier.
Lots more award availability
This is a trend that we're already seeing, and one that I expect to only get better.
Throughout the coronavirus pandemic, the TPG Points Lab found that award availability on United has increased by about 1,400%. With so many saver award seats available — especially on flagship routes in Polaris — the only reason to pay for your tickets with cash is to earn valuable PQPs and PQFs (or if the award value is less than our valuation of United miles).
Related: Airline award availability after coronavirus
If I'm going to be redeeming many more miles post-coronavirus, then it's going to be really hard for me to qualify for 1K, since you don't earn elite credit on award tickets.
Admittedly, it's nice to be able to redeposit speculative award bookings for free as a 1K, but that's a small penalty to pay for being able to redeem miles for many more flights and stop worrying about flying on paid tickets. And if I manage to reach Premier Platinum status, that'll still give me free changes and redeposits on award tickets more than 60 days prior to departure.
Bottom line
Once you're a top-tier elite, it's hard to get off the hamster wheel. Going forward, I'll be rethinking my strategy for whether it makes sense to push for United 1K.
There are certainly some pretty lucrative benefits like PlusPoints and complimentary upgrades, but United's recent changes mean that it's going to be much harder to earn status through partners. Plus, the redeemable miles I'll earn aren't as valuable as they once were.
Time will tell if 2021 is the year for loyalty program free agency, but it's definitely something I'm now considering.