American Airlines has backtracked on a controversial decision that would have made it much more difficult to earn airline miles.
Earlier this year, the airline said it would begin limiting which tickets purchased through third parties, such as travel agents or online booking sites, were eligible to earn AAdvantage miles and loyalty points.
It would have been the first airline to make the decision, pushing customers to buy tickets directly from its own website, thus saving commissions for other sites.
Such a move would prevent travelers from earning points by booking on many third-party travel sites, which may be cheaper.
Experts feared this would open the door for Delta and United to do the same. Airlines often copy cost-saving measures.
But, in good news for travelers, American Airlines abandoned the idea, which was due to take effect on July 11. It also means that their rivals will probably abandon any plans they might have had after seeing the reaction.
American Airlines has backtracked on a controversial decision that would have made it harder for customers to earn miles and loyalty points.
American Airlines did not want to create “confusion and disruption” for customers, CEO Robert Isom said, but the airline had also faced pressure from travel agencies.
‘Next month, we were going to differentiate who earned AAdvantage miles and who didn’t, based on where they booked. That’s wrong,” Isom told investors at a conference earlier this month.
‘We will not do this because it would create confusion and disruption for our end customer, and we will ensure we are careful. “We are listening to the comments.”
The plan was for customers to only receive reward points if they booked directly through the airline or through select partners and “preferred agencies.”
This would have reduced the commission the airline would have to pay to external agencies.
Travel agencies that did not receive the airline’s seal of approval faced the prospect of losing dozens of customers who would normally purchase American Airlines flights through them.
Zane Kerby, president and CEO of the American Society of Travel Advisors, defended the proposed policy and applauded the rollback, a travel industry site. Dodge reported.
“I am grateful for American Airlines’ renewed recognition of the essential role travel advisors play in facilitating air travel for our shared customers,” Kerby said.
‘I want to extend my thanks to American Airlines CEO Robert Isom for recognizing that his previous approach was flawed.
“Reversing the decision to retain AAdvantage points and miles for agency bookings is a testament to the strong position travel agencies maintain in the airline distribution channel.”
The initially planned change was to be made on May 1, but the airline delayed the deadline by two months.
“American Airlines wants to cut out the middleman,” Clint Henderson, editor-in-chief of The Points Guy, told DailyMail.com when the airline announced the planned change in February.
‘The airline has been moving away from third-party booking sites for some time, but they are now taking more extreme measures.
‘American is working on the theory that they no longer need third-party salespeople like travel agents. They don’t want to have to offer discounts or give commission to another company and believe they could get that business on their own.’
The change could also have affected those who like to redeem transferable credit card points through bookings with American Express, Chase or Capital One, had they not been on the airline’s “preferred agencies” list.
Henderson added that the move would mean American could make more money as it could sell customers other products such as early boarding, better economy seats or even first class seats if they have to book directly.
The airline has backtracked on a plan to limit the airline miles and loyalty points customers could earn by booking through third-party agencies.
American Airlines did not want to create “confusion and disruption” for customers, CEO Robert Isom said, but the airline had also faced pressure from travel agencies.
However, he pointed out possible flaws in the strategy at that time.
“However, there is also a big downside risk for Americans here,” he said.
“It could be a kick in the foot if some companies refuse to comply with the new rules and do business elsewhere.”
It comes after Delta Air Lines was also forced to do a 180-degree turn in a controversial decision to clamp down on its rewards program and airport lounge access last year.
The airline sparked a huge backlash in September when it announced plans to limit the number of admissions to its lounges and tighten qualification criteria for customers to gain frequent flyer status.
CEO Ed Bastian admitted the airline “went too far” with the proposed changes.
