Qantas has announced sweeping changes to its frequent flyer program, but not everyone will come out ahead.
Qantas has recently announced a range of significant changes to its frequent flyer program.
While some of the changes are positive, we will also see travellers chasing premium cabin redemptions pay more.
Qantas Classic Reward bookings in premium economy, business and first class (including popular Oneworld Classic Awards) are set to attract a higher points cost from 18 September 2019.
Granted, the increase isn’t that extreme, with members needing to fork out on increases of up to 15% more in points for seats at the pointy end. However, it’s still a devaluation. Those who book premium cabin award seats and upgrades will lose out, as an increase in points costs won’t be fully offset by carrier surcharge savings.
That being said, a devaluation of Qantas Frequent Flyer has been on the cards for a long time. Here’s why.
There are too many Qantas points in circulation…
Consider this: some years back, the prospect of 40,000 bonus Qantas points being offered for a new credit card was actually quite compelling. In 2019, however, many Qantas Frequent Flyer members won’t consider a new card for less than a six figure sign on bonus.
In fact, the credit card sign on bonuses being offered in Australia at the moment are some of the most generous in the world. There are plenty of other easy ways to boost your points balance, too (120k Qantas points for Health insurance, or up to 20k Qantas points with a case of wine, anyone?).
… while people are getting savvier at spending them
While shopping at the Qantas Store remains a popular way for many consumers to burn points, the art of ‘points hacking’ has become mainstream. As a result, more and more travellers are figuring out how to extract maximum value from their Qantas points through first and business class travel premium travel redemptions, and even the elusive Oneworld Classic Award.
And while Qantas has traditionally levied some of the highest carrier surcharges around, award seats at the pointy end must still impact Qantas on the bottom line.
Qantas will be betting that members who book premium award flights will be willing to pay slightly more – particularly with the sweetener of better award seat availability and (slightly) reduced carrier surcharges.
A string of recent loyalty devaluations paves the way for Qantas
In 2019, an unprecedented number of loyalty programs have undergone (mostly negative) changes and restructures. These range from mild devaluations of award charts (Singapore Airlines and British Airways), to more extreme increases in the cost of award tickets (think Malaysia Airlines and Thai Airways).
We’ve also seen Emirates axe Chauffeur Drive services on premium award bookings, while Velocity introduced carrier surcharges on award flights. But perhaps most worrying of all, leading US-based carriers (Delta and United) have moved towards a dynamic pricing model.
Given the scale of these changes, it’s unsurprising that Qantas felt emboldened to enter the fray.
Conclusion: The devaluation that Qantas Frequent Flyer had to have
Qantas Frequent Flyer is a valuable commodity, and a veritable cashcow for Qantas Group, so it makes sense that any devaluation would be relatively restrained.
While I’m sad to see the points cost of premium award bookings and upgrades rise, I expect that many members will take the hit with a minimum of fuss.
And with a significant overhaul of the program now complete, let’s hope that it’s another 15 years before Qantas award chart pricing comes under the microscope again.
Subscribe to The Champagne Mile newsletter for the latest deals, tips and news. It only takes a few seconds, and we respect your privacy.