News and Views (Airlines) - Oct 4

By Neil McPherson
4 October 2019 

Velocity members slugged again, only a year after carrier charges were introduced

In a hit to Virgin Australia's loyalty members, Velocity Frequent Flyer has announced it will be raising its carrier charges on rewards seat redemptions, only a year after introducing the charges.

The changes only impact Virgin Australia operated flights in Economy and Business class, and are effective for bookings made on or after 8 January 2020.

There are no changes for flights to Los Angeles, nor are there any changes in fees for Premium Economy seats or partner flights.

The carrier charges can be paid with Velocity Points or a combination of Velocity Points and cash, and will be applied during the booking process.

The increased charges, some almost tripling, are shown on Virgin Australia's website.

American Airlines and Alaska Airlines continue to go their separate ways

It was revealed that huge cuts will be coming to the partnership between Alaska Airlines and American Airlines as of March 1, 2020.

For Alaska Mileage Plan members:

• You will no longer be able to earn Alaska Mileage Plan miles on American Airlines international flights; mileage earning on domestic American flights had been cut in early 2018
• You will no longer be able to redeem Alaska Mileage Plan miles for travel on American Airlines, both domestically and internationally.

For American AAdvantage members:

• You will no longer be able to redeem American AAdvantage miles for travel on Alaska Airlines, either domestically or internationally.

Some codeshare routes will continue (for now) and reciprocal lounge access remains in place.

These changes started happening right around the time that Alaska and Virgin America merged. Before the merger, the route networks of Alaska and American largely complemented one another, though post-merger that has changed. So perhaps these changes are to have been expected.

Alaska continues to partner with airlines in oneworld like Qantas, Cathay Pacific, and British Airways and with independent carriers like Icelandair and Hainan Airlines. They’ve said they’ve looked at joining Oneworld as a limited ‘connect carrier’. So for Alaska Airlines fans outside the US, this may not have much impact.

But the woes for American Airlines continue.

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Alaska Airlines ups ante with its status-matching

Alaska Airlines had been known for generously giving status without any restrictions. That is not the case anymore.

From now on, any successfully matched account would enter a three-month challenge period first. In order to keep your status after the initial three-month period, you’ll need to fly on flights marketed by Alaska Airlines and operated by Alaska Airlines, Horizon or SkyWest during that initial three-month period. Codeshare flights operated by other airlines, flights on Alaska Global Partners and award travel do not count toward keeping your status.

For folk outside the US, this makes it much harder to attain elite status on the Alaska Mileage Plan. Its points earning and redemption continue to offer exceptional value though. Unless/Until Alaska becomes a member of oneworld (and you can rely on reciprocal rights within the alliance), it may be smart to retain Alaska Mileage Plan membership and consider obtaining lounge access through its lounge club membership.

This can be a smart strategy for Qantas Frequent Flyers in any case, as Alaska lounge club members gain access to (eg) Qantas Club lounges on favourable terms.

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LATAM dumps American for Delta - leaves Oneworld alliance

Delta Air Lines’ announcement last week of its intention to purchase a 20% stake in LATAM for USD 1.9 billion. This resulted in:

• blocking American’s joint venture with LATAM
• substntially better access for Delta travellers to Brazil, Argentina and Peru
• Delta announcing it will exit its minority stake in Brazilian carrier GOL
• LATAM announcing it will leave the oneworld alliance and unwind arrangements with American Airlines, although the relationship with Qantas appears intact, as LATAM group chief commercial officer Roberto Alvo stated “We will keep our current bilateral agreements with all the other carriers in oneworld”. It appears LATAM will become unaligned, rather than joining Delta at Skyteam.
• complements Delta's other minority shareholding or JV's with Virgin Atlantic, Air France-KLM, Korean Air, Virgin Australia and China Eastern.