Delta Introducing Pay With Miles to Upgrade Any Fare By End of Year

Delta President Glen Hauenstein said in the introduction to the airline’s second quarter earnings call yesterday, “We continue to roll out more options that our customers are asking for, including the ability to paying with miles by the end of 2018.”

He didn’t elaborate on what exactly Delta plans to allow customers to pay for in his remarks. However later in the call CEO Ed Bastian explained that mileage upgrades are going to fuel additional demand for premium economy and business class,

[A]s we continue to roll out different ways to buy those products, we will see I think another explosion in demand as other customers will use their miles to sit in the cabins they want.

And I think bringing that ability of our frequent flyers to choose where they want to sit after they buy the ticket is really going to be something that’s going to generate a lot of great products and services for customers as well as revenue for the airline.

Bastian is suggesting that they’ll let customers ‘buy up’ from their purchased ticket to a higher class of service paying with their miles.

This appears to be a revenue-based product, using miles instead of cash to pay whatever Delta happens to be charging. And whenever miles are used directly to pay a cash cost, it’s always going to represent poor value for miles.

Instead of getting 8-10 cents per mile compared to retail price redeeming for premium cabin international saver awards (seats that are expensive to buy but that the airline expects to go empty and so will unload at a discount through the mileage program) you can expect miles to be worth no more than a penny or so or perhaps less when directly displacing revenue the airline expects to earn.

Since the timeline here is this year and we’re already past the halfway point we should learn more details soon — though perhaps not before they actually roll out the product, since Delta seems to offer the least transparent frequent flyer program in the United States.

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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  1. @ Gary — Please show us where to get 8-10 cents value for a DL mile. Maybe 0.8-1.0 would be a more accurate amount these days.

  2. He cannot. He speaks from his behind.
    At nearly 100,000 miles for a one-way business class ticket (hard to find) you would have to spend $10,000 to get 10cpm.
    Sure, there may be some business class tickets selling for that much, in the same way you can spend 5,000 on an economy ticket

  3. Given how RDMs just pile up in my account and just sit there unused – I’d absolutely love to have this option over at AA.

  4. I got about 6.5 per DL point flying business class on China southern using my DL points. Not 8 cents. But close

  5. This may not seem like a great option, but often when I fly the tickets purchased for me through my company do not allow me to upgrade. Delta is the ONLY US carrier that lets me both up grade and link my flight to my Delta account. All the others don’t allow upgrades nor will they let me link my flight to my account on their web sites. The excuse for this is I didn’t pay for the ticket myself.

  6. This is how I got into the miles game all those years ago with Continental, and why I’m relinquishing my status with United this year. I always bought economy and upgraded to first with miles at the time of ticketing. I really don’t care what the tix costs; I refuse to fly in coach. Haven’t been able to do that for quite some time. I’ve been wondering which airline I’ll be loyal to (I fly out of SFO so many choices) and it sure looks like Delta will be at the top of my list.

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