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It has been more than two months since the journey halted. Still life moves forward, and Americans continue to shop, pay bills, and attempt to make personal finance decisions possible. While many credit card holders are now prioritizing withdrawing cash on travel rewards, they may make a mistake. When more planes take to the skies again, I think we will see the golden period of the prize journey.
How award travel works
As a refresher, airlines, hotels and credit card issuers provide points and miles to attract customers and build loyalty. Customers can redeem these prizes primarily for untaxed airline seats and hotel rooms.
When the economy is good, airplanes and hotels are full, which reduces the number of extra seats or rooms offered as travel rewards – and needs to attract more customers in the first place. As a result, it can be nearly impossible to redeem your points and miles for your favorite destinations by air travel, especially if you want to fly in business or first class.
When there is a crisis that decreases demand, the situation is reversed. Airlines and hotels struggling to attract travelers can offer more ways to earn points and miles, which may open up better opportunities for customers to cash in on them.
What does the award travel potential look like now?
We are now seeing exceptional airline award availability.
For example, here are the results of a United Airlines Award fare search, looking for two business class award tickets from Denver to London Heathrow at the end of the summer. Generally, we do not expect to see any availability at the “saver” mileage level of 60,000-70,000 mileage mill.
American Airlines Reward Travel As Flights Resume Will Award Travel Hit a Golden Age
But now, Seaver Prize flights are available every day of the month – what would normally be peak season. In addition, multiple flights are available at the lowest mileage levels each day. The situation is so extreme that it would be difficult to find flights without the availability of prizes.
This is a similar story for the American Airlines business class awards on the Denver-to-London route and for the Business Class Award on the same route with Delta Air Lines.
Yes, many international flights are grounded, with limited seats available for any trip, award or otherwise. But most airlines expect operations to resume as soon as travel restrictions are relaxed, leading to over-capacity flooding in the market.
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Cases against the golden age of award travel
Of course, there can always be other arguments made – but I think they still hint at greater prize availability to come.
First of all, you could argue that there are of course many available award seats now, when no one knows when it would be safe to travel again. You may ask: When the journey resumes, all these award seats are not stripped? nobody knows. But with two-thirds of the world’s passenger airplanes currently grounded and parked, it is unlikely that those seats will be hard to find when they return to the air.
As Flights Resume Will Award Travel Hit a Golden Age
Another possibility is that cash-less airlines would be eager to sell seats for dollars instead of prizes, so they would severely limit prize seats to a reasonable number. But this view ignores the fact that unused frequent flyer miles are an accounting obligation for airlines. Typically, carriers can gladly redeem their miles for seats on nearly empty or half-full planes to erase that liability from their balance sheets to customers.
Finally, the best argument against the future value of travel rewards is the possibility of severely low prices for airline travel and hotel rooms. If you could buy a round-trip business class ticket to Europe for only $ 1,000, you would receive several times more value than your ready-made miles, when such a ticket would cost $ 4,000.
Record low demand and declining fuel prices support the idea that air travel during the recovery period can be extremely low cost. As a result, many travelers may look to pay cash for travel at bus bargain-cellar prices. But the possibility of airlines blocking middle seats to promote social disturbances could reduce these savings as fewer seats are provided.
And even though cash prices are low, you can take advantage of these prices and travel for almost free while redeeming credit card rewards for travel. For example, the Capital One® VentureOne® Rewards Credit Card allows you to redeem your miles for 1 percent each as a statement credit toward travel reservations, or to them.
Buy American Airlines miles for less per 1.8 centimeters per mile is it worth considering?
Buying American Airlines miles: does it make sense? – Number Boys
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Editorial note: The opinions expressed herein are those of the author alone, are not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, Best Approved or otherwise endorsed by any of these entities.American Airlines Reward Travel.
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