- They’ve increased the price of transferring miles from one account to another to 1.5 cents a mile.
- The bonus doesn’t all go into the account receiving the transferred miles, half the bonus goes to the mileage recipient and half to the original accountholder this time.
The value proposition is different than before, so let’s talk about what it costs and whether it’s jumping on.
US Airways has long been a fascinating case, their Dividend Miles program sells miles consistently inexpensively through bonuses on purchased miles and also on share miles (where you transfer miles from your account to someone else’s at a cost, and they get more miles in their account than you took out of your own).
Back before 2010 business class awards to Europe were cheaper and miles were cheaper. “These deals aren’t as good as they used to be.”
But a 100% purchase miles bonus, which has been available to most members most of the year, means buying miles at 1.88 cents apiece. Not bad, not at a price I’d stock up my account speculatively (I need to be at ~ 1.5 cents a mile or less for that, though it depends on the currency of course and how many miles I already have — the value goes up as I get closer to having enough miles for the award I want, and goes down as my balance increases).
Share miles bonuses of 100% usually mean buying miles ~ 1.2 cents apiece. I think those are great and worthwhile. Sadly US Airways has raised the price of sharing mile bonuses to 1.5 cents a mile plus a $30 transaction fee and 7.5% tax.
About four years ago US Airways got new targeting and tracking software, and started playing games with these bonuses… like targeting, like variable bonuses, like tying bonuses to being a co-brand credit card holder.
None of those games this time, no need to log in or verify your account before seeing your bonus.
The 100% share miles bonus is back, which is fantastic. The trick this time is that the mileage recipient gets half the bonus, and the person transferring miles out of their account gets half the bonus.
That means it is a bit more complicated, much more likely to be useful in building miles in more than one account than it is for buying miles in one shot cheaply to book an award right away. Very clever.
Limited time offer!
From now until June 30, 2014, share your miles with a friend or family member and split the 100% bonus. That’s 50% for you and 50% for your recipient!
- The offer ends June 30 2014 at 11:59pm Pacific.
- Each account can receive up to 50,000 bonus miles, which would mean two maxed out transfers.
- Bonus miles are split evenly between the giver and recipient.
- As usual, Dividend Miles accounts less than 12 days old are not permitted to share miles or receive shared miles.
- “Miles are shared for $0.015 per mile plus a processing fee of $30 and a tax recovery charge of 7.5%.”
Here’s the math on transferring 50,000 points out of your account:
The cost to share 50,000 + 25,000 Bonus miles is $836.25 (including taxes/fees)
You pay $835.25.
- 50,000 miles go out of your account.
- 75,000 miles go to your recipient.
- 25,000 miles go back to your account.
The net increase in miles is 50,000 at a cost of $836.25 or 1.6725 cents per point. So an increase over the 1.2 cents that shared miles used to cost, and inconveniently for most half the net increase in points go into each account.
As a result I’m not a buyer at this price. But an interesting development. And suggests that the days of 1.2 cents a mile purchases through shared miles are gone at US Airways (which is not surprising since this is still about 25% less than that price at which American generally offers miles ‘on sale’).
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