Delta and united give cardholders a price break on award flights
Airlines are increasingly leveraging their credit card programs to retain customers, offering perks like free checked bags and priority boarding – and now, lower redemption rates. Delta Air Lines and United Airlines are leading the charge, extending discounted award ticket prices to holders of their respective cobranded cards.
A smarter way to fly: discounted awards for cardholders
Both airlines are providing significant savings to cardmembers. Delta's ‘TakeOff 15’ program, tied to American Express cards, offers a minimum 15% discount on miles fares, while United’s MileagePlus program provides varying discounts depending on card type and elite status. These benefits are becoming increasingly attractive in an environment of dynamic pricing and frequent devaluations of airline miles.
The trend raises key questions: Will other domestic programs, like American Airlines AAdvantage and Alaska/Hawaiian’s Atmos Rewards, follow suit? And what does this mean for ‘free agents’ – frequent flyers who don’t commit to a single airline loyalty program?
Delta’s takeoff 15: a closer look
Delta’s TakeOff 15, available on cards like the SkyMiles Gold, Platinum, and Reserve American Express, reduces the miles cost of tickets by at least 15%. For example, a one-way flight between Atlanta and San Francisco, typically costing 20,300 miles, drops to 17,200 miles with a qualifying card. This translates to potential savings of roughly $100 on a typical route, according to TPG valuations.
United’s mileageplus discounts: nuanced pricing
United’s award pricing is complex, varying based on factors like elite status and card type. Chase cards like the United Explorer, Quest, Club, and Business Club offer discounts ranging from 10% to 15% on award redemptions. A Chicago to San Francisco flight could cost as little as 12,700 miles with a United card, compared to the standard 14,200.
Beyond the big two: future trends
While Delta and United are currently leading the way, there's a strong likelihood that American Airlines and Alaska/Hawaiian Airlines will implement similar cardholder redemption perks to bolster customer loyalty. Airlines are increasingly leaning into cobranded cards, adding bonus categories for spending in various areas, like foreign transactions and gas purchases.
The bottom line: a strategic move
Ultimately, these discounted award rates represent a strategic move by airlines to incentivize spending within their ecosystems and retain valuable customers. While ‘free agents’ might miss out on these deals, the trend signals a shift towards greater loyalty rewards and a more competitive landscape for frequent flyers. It’s a good time to assess your own points portfolio and consider whether adding a cobranded card to your holdings is a smart move – particularly if you frequently book flights with Delta or United.