Chris Elliott Thinks Award Redeposit Fees are Unfair, or Too Expensive, or Something

Chris Elliott rails against US AIrways for their award redeposit fees.

Award tickets are not free. Victoria Casey knew that when she made plans to fly to Europe on US Airways this summer. Each reservation cost her $50, in addition to the 320,000 miles she spent for four first-class tickets.

But Casey never imagined she’s be paying the airline for nothing — and paying it a lot more than $200.

Hers is a cautionary tale about the value of frequent flier mileage programs.

Yes, frequent flyer programs are some sort of trap to suck out your money.

Granted, US Airways charges award ‘processing fees’ in this case the $200 referenced above for 4 tickets. That does strike me as unreasonable, a fee for the privilege of booking a free ticket. And that’s entirely apart from the telephone booking fee (waived on itineraries that can’t be booked online such as partner awards, which makes partner telephone redemptions cheaper than US Airways ones). So it’s not a fee for telephone assistance, just a redemption tax.

I don’t like that fee at all, but I deal with it because US Airways miles are easy to obtain and they’re great for international premium class redemptions.

But the person writing to Chris cancelled their trip,and they were charged award redeposit fees.

If these were paid tickets, there’d be a cancellation fee as well. Most tickets will retain their cash value minus that fee, and award tickets get the miles back. You can’t withhold the fee from the miles, so they take the fee upfront in cash and refund all the miles.

Of course this fee is optional, you don’t have to pay it if you want to let the miles go to waste. You’re just buying back your miles, and in this case buying over 300,000 miles for an incremental $1000 is hugely worth it.

I will say that the amount US Airways charges — $250 on an international itinerary — is high. It’s very high. British Airways charges $70. Air Canada charged CDN$90. American and United do charge $150. And US Airways says they’ll charge the fee on redeposits or on any change at all in advance of travel, and no changes or redepostits once travel begins. They/re certainly on the high side here. But for an optional fee that’s worth it that mirrors paid tickets, it is what it is.

Ultimately I’d like to see these fees more closely mirror paid tickets that allow changes and credits for a fee. That fee is taken out of the value of the ticket. Why not allow the cancellation fee to be paid in miles? Though if this option were introduced, it would probably be for too many miles to be worth it. Still, it seems a reasonable thing to ask for.

The point of the column, as I take it, is be aware of the fees you face.  And since top tier elites at most programs don’t actually face these fees at all, it’s another argument for focused loyalty.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Thanks for the great blog. I agree redeposit fees are valid otherwise everyone would just hold and cancel when they don’t need. However I do like Delta’s model where top tier can get these fees waived twice a year. AA for example doesn’t even waive this for EXP which is a bit frustrating.

  2. “Why not allow the cancelation fee to be paid in miles?”

    Both Alitalia and ANA (and I’m sure others as well) allow this–and its quite reasonable! ANA is a mere 3000 miles, and Alitalia only 5000! Though, Alitalia may not allow for the redeposit of miles (I do not remember), just changes.

  3. This is just silly! We’ve become too complacent, accepting fees for using our miles (when they let us use our miles) and then for not using our miles. We’ve already paid for these miles with our flying and our purchases and our loyalty. The fact that we’ve accepted the vacuous premise that airlines can and should charge us fees for travel they’ve sold us as free is drinking their Kool-Aid.

  4. I’m not a Chris Elliott fan, and I generally believe that US is a better managed airline than most people give them credit for. That said, I hate these frequent flyer fees, even though I rarely pay them (I’ve never paid a fee to redeposit an award).

    I think airlines tend to forget that ff tickets are an award for LOYALTY. This isn’t how you treat your loyal customers. I can see the logic of change fees for award tickets because we don’t want people booking tentative reservations, but you don’t need a $250 per ticket fee to discourage such bookings. And charging pax for the privilege of using their ff miles is just repugant for the reason stated above.

    I often book family award travel and I know I’d be really pissed off if I had a four-figure tab to cancel my reservation. That’s simply not right, is not conducive to future loyalty, and airline management should know better.

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