Here’s Why Upgrades With Miles Aren’t a Good Deal… And They’re Getting Worse

Conventional wisdom used to be that the most lucrative way to use miles was for upgrading paid international coach tickets to business class.

That’s because you would accrue miles for the paid travel, plus earn status. And because upgrades require fewer points than a free ticket, you stretch your miles further. 



Unfortunately that’s no longer true.

  • Upgrade awards have become harder to get
  • Airlines have introduced cash co-pays in addition to miles, or restricted the fare class you have to buy, making upgrades far more expensive
  • Award tickets have gotten more flexible, allowing you to combine travel on different partners
  • While upgrade awards haven’t gotten nearly as flexible for partner travel, generally requiring purchase of a full fare ticket if the option is offered at all.

When you buy the cheapest ticket most U.S. airlines require cash co-pays that sometimes cost more than $500 each way, so you pay an extra $1,000 or more per person for the privilege of using your miles to upgrade on top of miles.

Cash co-pays are no longer even restricted to international flights, they apply domestically as well.

Delta hasn’t played this game, but they don’t allow you to upgrade with miles internationally unless you first purchase a nearly full fare ticket. That’s worse than a cash co-pay, where you pay extra only if you actually sit in business class. A minimum fare requirement is a ticket to a lottery. You pay more for your ticket, and if the upgrade is waitlisted you don’t get your overpayment back. There aren’t a lot of things airlines do that actually shock me, but taking your money for the chance of upgrading (they aren’t even required to fill all of the forward cabin seats if they don’t want to) and then keeping your money from your buy up to a higher fare even if they give you nothing more in return, is actually pretty offensive. And yet the Department of Transportation focuses its rule-making on insufficiently disclosed codeshares.

There are very few exceptions to the rule that upgrades don’t make as much sense as award tickets. British Airways upgrades from Premium Economy to business class, and the same with Virgin Atlantic’s offerings of the same, are exceptionally cheap in miles and do not require cash co-pays at all.

What amazes me isn’t just the upgrade fee of up to 20,000 miles and $550 each way that United charges for an upgrade between North America and Europe (American’s top price is 25,000 miles and $350 each way) , but that these fees have started to pile up domestically.

Matthew points out that United has just increased the price of upgrades on its New York JFK – San Francisco and Los Angeles routes. And the amounts are shocking.

Here is what United charges for its upgrades on US domestic and Hawaii routes.

United waives cash co-pays for full fare passengers and for elite members on non-premium routes.

Co-pay exemptions

  • There is no co-pay for full-fare United Economy or United Business tickets for travel in any region.
    • A co-pay will not apply for Premier members traveling on the following routes:
      • Within the U.S. (excluding Hawaii, Guam and Puerto Rico) and Canada
      • From the U.S. and Canada to Hawaii (except between EWR/IAD/IAH and HNL)
      • From the U.S. (excluding Hawaii, Guam and Puerto Rico) and Canada to Mexico, Central America or the Caribbean
      • Within Oceania (except between HNL and GUM)

    • Non-Premier members traveling on the routes listed above are also exempt from the co-pay when sponsored using miles from a Premier member’s MileagePlus account.

But for non-elites, a basic domestic upgrade (confirmed at booking if space is available) costs 20,000 miles plus $75. For Hawaii it starts at 27,500 miles and $125 for the cheapest fares.

They have this higher price category for routes operated by international aircraft, and for the premium JFK transcons.

You can pay as much as $250 each way in cash on a simple domestic New York – San Francisco roundtrip, and $500 in cash each way on a Hawaii roundtrip if you’re flying on the routes they operate international equipment.

Upgrades aren’t what they used to be, and that leads to some perverse consequences as a result of relative prices.

Now, upgrade space can be easier to find than award space. But consider 40,000 United miles plus cash on top of your fare to upgrade a domestic ticket versus 40,000 Chase or American Express points transferred to Singapore for an award ticket with only $5 in security taxes… or 35,000 Lufthansa points for the same.

Much like Hyatt increasing the price of its points upgrades discourages me from spending more on room rates to be able to use points for a suite this change in relative prices males paid tickets less desirable m. That may not be good for United.

Although they could also even further restrict award space on these routes. But that just serves to further undermine the value proposition of the multibillion dollar MileagePlus program.


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. As a United elite, I must say I’m thrilled it’s harder and more expensive for non-elites to upgrade. One of the perks of flying an airline more is that it hopefully gets you upgraded more often–and for less than non-elites.

    All airlines should be staggering service and benefits for those that spend more on their products/services. For elite flyers and elite airline co-branded credit card spenders, they should get the most benefits because they provide most of the revenue stream. Everyone else should pay more to achieve those benefits, which keeps the benefits most available for those who fly/spend the most.

  2. For many domestic routes (NOT including the premium transcons between JFK and LAX/SFO), as of late I’ve also noticed that it’s more worthwhile to just buy a discounted First Class fare as they’ve come down a lot in price in many markets. In such cases, comparing the discounted first class fare to a coach fare + cash copay + miles often nets you only a 1 cent per mile valuation; NOT a great use of miles, unfortunately.

  3. Back in the 90s, would you say the it was wise to upgrade using miles versus redeeming a seat on the flight? Do you think that’s why older people tend to have that mindset?

  4. upgrading stinks in terms of CPM value you extract out of the miles, but it’s great because you can still earn RDM and PQM and PQD on those really long flights

  5. Nice post Gary!

    The Flyertalk BA forum always rave about MFU from premier economy. Do you find it a good value? I’d probably be only interested in Lax-LHR non stop, a tough award ticket for 2 travelers even on AA as an Exec Plat

  6. I would have to disagree specifically for the p.s. route. At $2,200 each way (rarely discounted), I would say this is a decent use of miles, especially when they don’t offer CPU on this route. Also, R space can be plentiful if you look for the right flights – I’ve been cleared as Platinum on all but one flight, and the one is where I didn’t request an upgrade on purpose.

  7. Actually RDUs are the best upgrade option on the PS route, if you have them. $350 RT plus 2 RDUs > $2200 or 15k miles. Plus you get EQM.

  8. I was informed by United that the upgrades I purchased when offered to me during purchasing our tickets between LAX and HNL do not count towards our PQD spending towards our Platinum or 1K Elite status. I purchased 2 round trip tickets for our next 5 trips and when I questioned why only the base fare was applied towards our spending United told me that the tickets should have been reissued as first/business class. This does not make sense to us because we were not informed in advance that our extra spending will into count towards our Elite PGD. Do you have suggestions how can we resole this? We are loosing out of several thousand we paid to United for our travels but the are refusing to apply it towards our PDQ. We have been flying with United since the merger at least 11 trips each year.

  9. You analysis of Delta and international upgrades is US focused. Being AMS based, and purchasing ex-AMS tickets on Delta, M fares are often not that expensive when you consider the flexibility you receive. Ex-AMS “M-fares” are fully changeable/refundable (not credit voucher refundable, but refundable to your credit card with no fee). Often these fares are only a few hundred €s more than non-refundable/non changeable lower fare classes ex-AMS. Most bloggers, fail to realize that there are a lot of “real world” folks who often have to change and rearrange their tickets on a regular basis. I buy M-fares for the ability to not have to worry about crazy change/cancellation fees; the ability to upgrade is a cherry on top. In addition, ex-AMS I’m running over 95% with upgrades to BusinessElite; even considering about 50% are not confirmed until day of departure.

  10. @baccarat_guy “Most bloggers, fail to realize that there are a lot of “real world” folks who often have to change and rearrange their tickets on a regular basis.”

    I often have to change and rearrange my tickets on a regular basis 🙂

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