Triangle Trip

United is trying to win back more and more customers like us… I just got an email from United telling me that they will be removing the last minute (“close-in”) award processing fees effective July 30, 2009.  The award travel processing fees were $100 if you booked an award ticket within seven days of departure, and $75 for 7 to 21 days prior to departure.

Here’s the link to the official press release:  United Puts the Easy Back Into Using Frequent Flyer Miles, Eliminates Fee

This is United’s attempt to get its customers to use up their miles and so United can clear its balance sheet of people holding onto airline miles.  We should take advantage of this opportunity and burn up some miles.  This new policy does not eliminate the co-pay for upgrade (see previous post).  Delta need to follow suit as they are notorious with award booking fees.

Before booking an international ticket on United, I went through the Coach’s “Checklist for buying an international ticket.” In addition to the checklist, I went to UAL’s upgrade award chart and noticed UAL will be charging its customers a co-pay to use their airline miles to upgrade beginning July 1, 2009. Here’s the PDF and link for more details on how your miles are worth less and less in this economy. This is why I have been advocating to everyone to bank hotel points vs airline miles.

Under the new co-pay using miles to upgrade system, United will charge you $50 plus 15,000 for a one-way domestic (North America excluding Hawaii) upgrade unless you have a full fare economy ticket (which is class Y or B). The cost of the class Y or B ticket is nearly double. Your best bang for the buck on using miles to upgrade is for international tickets. The new co-pay system will have you paying $250 to $300 plus 25,000 miles each way for an international upgrade. Also keep in mind that the class of the international ticket must be class M or H or B — near full fare economy class.

The cost differential between a discounted economy ticket and a near full fare ticket is nearly double (see picture below):

The cost to buy a round trip international ticket is: $2,193.20 when it is “Upgrade Eligible” compared to $1,324.20 for a discounted and un-upgradable international ticket. As of today, I would have to use 60,000 airline miles plus $2,193.20 to get a round trip business class ticket on UAL from North America (San Francisco) to South Asia (Hong Kong).

Beginning July 1, 2009, I would probably have to pay an additional $500 co-pay charge plus 50,000 for the same international round trip ticket. The Upgrade Award chart was not really clear on the exact co-pay charge but it did say it would cost me 50,000 miles for a round trip upgrade from North America to South Asia.

For the record, a Business Class international ticket for the exactly time and dates was $2,985.20. The total price of $2,193.20 + $500 and 50,000 miles is not much cheaper (if not more expensive since you need to earn your miles) than the regular $2,985.20 Business Class ticket. With the business class ticket, you probably can earn more bonus points on UAL.

In summary, I strongly urge everyone to use their airline miles upon accrual. Just like the US dollar, inflation is inevitable. Today’s miles won’t go as far tomorrow.