Why Delta 44,000 Mile Sydney Roundtrips Are Sad

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@OHTravelDad tweets about Delta award values and highlights 44,000 mile roundtrips between Washington DC and Sydney in economy.

I think it’s worth following this line of thinking further. Is that even a good deal?

I’ve written before about how Delta award sales don’t drive much value to the program.

Pulling up award calendars on Delta it’s indeed possible to find 44,000 mile roundtrip. What’s striking to me is how much extra legroom coach is pricing for the same flights (164,000) and how much business class costs. Imagine, 930,000 miles for business class. This isn’t even first class – and you’d better hurry, there’s only 1 seat left at this price.

If you do want an Australia award in economy you can book it for 44,000 miles and $113.33 on days where flights are cheapest.

However buying the tickets straight out would cost you $754.53. Since the award still has you paying out of pocket for taxes, redeeming miles saves you $641.20.

Redeeming 44,000 miles for 641.20 means you’re getting 1.46 cents per mile in value and unlike the paid ticket you don’t earn miles.

This is what’s considered a ‘deal’ on Delta, are you’re better off with a 1.5% cash back card than spending on a Delta co-brand — just buy the ticket you want (on Delta or another airline) and earn miles and credit towards elite status. Of course you wouldn’t want to settle for a 1.5% cash back card, just get a Citi Double Cash Card and do one-third better still.

What Delta has done is adjusted its mileage program so you get more consistent average, low value. Programs with fixed award charts might still charge 25,000 miles for a domestic first class saver award seat even when it’s selling for $99 because it would otherwise go empty. You just pay cash instead of miles when the mileage deal is bad but the fare is cheap.

With Delta you aren’t going to get great value for your miles, but you can still get a penny a mile when fares drop. They don’t have award charts, and they’ve been driving towards a revenue-based program where miles have consistent (low) value. Don’t confuse that with delivering value to members.

Historically it’s made sense to redeem miles for travel that’s expensive, and use cash for travel that’s cheap. Low per point average value turns that on its head.

Is 44,000 mile + $113 tax roundtrip for an itinerary that costs $755 to buy a good deal?

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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Pingbacks

  1. […] View from the Wing points out that this means those who ordinarily earn their SkyMiles at a rate of 1 SkyMile per dollar spent on a Delta credit card are getting a poor deal for spending on said card compared to a cash back credit card. Of course, that’s true with every airline credit card, since we don’t value any airline miles at better than 2 cents. With so many transferable currency cards on the market, I would hope that most readers are only spending on a card that earns 1x airline miles if they value status benefits that can be earned based on spend on that particular card. […]

Comments

  1. I just bought East Coast-Europe for 46000 miles r/t where the same ticket, same dates in Economy (L) clocks at $1950! Depends on your luck.

  2. “This is what’s considered a ‘deal’ on Delta, are you’re better off with a 1.5% cash back card than spending on a Delta co-brand — just buy the ticket you want (on Delta or another airline) and earn miles and credit towards elite status.”

    This is where your analysis misses the point. From what I can tell, very few people are spending money on a Delta Co Brand card to earn Skymiles. The people who really put money on the Delta cards are trying to earn miles for status; these people are already paying cash for Delta tickets, travel a lot domestically and want to make their experience as pleasant as possible. SkyMiles are a byproduct of flying Delta and spending money on the card for the MQM boost. You can argue that these people shouldn’t focus on status, but Delta MQM are valuable, especially given they rollover.

  3. No longer being the weekly road warrior, I have been booking away from Delta at all cost for my travel the last couple years.

  4. My recent trip to Hong Kong with 2 brothers for 90,000 Skymiles all in for our 3 round trips begs to differ. As much as it appears you hate to hear it, Skymiles can be of great value quite often. Deal with it already.

  5. It seems Delta wants miles to be used to fill the cheap seats so they can “upsell” you add ons. They don’t want miles to be used on the unused capacity. IE if the seat is going unfilled they wont sell it to you for miles, or at least not for less than a ton of miles. Its a distinction, they are definitely getting very close to Southwest’s notion of miles, but it’s really not very customer friendly for Delta at least. You can only get nominal per point value, you can’t book close in, and you can’t change your flights. All wins for Delta.

  6. If you’ve got $750 to spend no problem, then of course that’s the better value.

    The fact of the matter is, there are many people out there who would love to travel to Australia but cannot afford a $750 fare. CPM might be the barometer by which you and others judge a program, but it cannot be the entire barometer by which the value proposition of every single award ticket is judged. It’s all relative.

    Relatively speaking, no other airline will get you to Australia for 44k miles. So sure, Delta is boosting the perceived value of its program by putting out these award sales, mostly on lower-priced cash fares to control the redemption value. But the fact of the matter is that for the flyer who has SkyMiles but can’t afford a cash fare to Australia, it doesn’t get much better. I don’t think you should be so quick to write that off.

    And to be clear there are just as many instances where these award sales result in a much higher CPM. Their sale to China last month was 30k SkyMiles for a $800-900 flight.

  7. I got 97k JFK > Christchurch with a nice usable 8 hour layover in China. Given other normal routing to the south island of 3 flights, this 2 flight set up was not much longer and the layover is useful during afternoon/evening hours to tour China. 97k and like $5.60 in fees/taxes all with China Southern in business class on both flights.

    There is value to be had with Delta, you just have to be vigilant and learn to use their partners!

  8. “The fact of the matter is, there are many people out there who would love to travel to Australia but cannot afford a $750 fare. ” If you can’t afford $750 airfare, how you gonna afford hotel and means?

  9. @Kyle, how would you manage to acquire 44,000 delta miles inside a budget that would not allow for a $750 ticket, not even mentioning that Gary talked about other programs that allow you to go to Australia for cheaper, cash back programs.

  10. @ Gary — Even with flex dates and several passengers, I cannot get DL.com to display more than 930,000 miles for the above. I wonder if the display can’t handle 7-figures? It’s like back in the 1970’s when gas went over $1.00 per gallon and the mechanical displays on the old pumps couldn’t show a price that high….

  11. Disengaged from the SkyMiles program starting 3 years ago. 12 years flying as an Plat elite. Don’t miss it and it’s overpriced awards at all. I do miss Delta sometimes as they are a pretty good airline, and I fly them when it’s convenient.

    I’m really going to enjoy my 70k AS mileage redemption on Qantas F LAX-MEL next month (myself and the Mrs.). That kind of deal could never be redeemed on Delta.

  12. @farnorthtrader – You really think there aren’t people out there who earn miles by putting their everyday, necessary expenses (food, utilities, daycare, whatever) on a credit card but don’t have $750 left over in their budget for airfare?

    Just because buying the cash fare is the “better deal” from the perspective of a seasoned travel hacker with plenty of discretionary spending does not mean that 44k SkyMiles to fly RT to Australia is a bad deal.

  13. @Kyle, so if they are earning it using credit cards, then Gary’s advice holds. Get a Cap One 2% back card and for the $44,000 you spent to get the Delta miles, you would get $880 cash and could book the Delta flight for cash and have $240 to spend on your food when you arrive. And you would get a small number of Delta redeemable miles and quite a lot of MQM.
    The only way that using Delta miles makes more sense is if they were earned in a way that the cash back card could not earn them. The only ways I can think of are either through paying for flying Delta or through shopping portals that offer a better return in Delta miles than cash back portals. In either case, the amount of paid flying or the amount of portal shopping that would be required suggests that the budget would have room for $750 tickets. One last possibility is if someone else is paying for your flying, in a case where they are paying to fly you a lot, but aren’t paying you well enough to afford a $750 ticket. I would suggest that is an edge case at best.

  14. As EricZ states, there is value if you learn how to use their partners. I’ve flown in business multiple times (one-way) ATL-MNL for 85K SkyMiles. While 85K is not great, it beats the heck out of 400K or whatever other ridiculous amount they usually ask.

    The real problem is there’s not a partner available for most things, and if I just want to use SkyMiles for a basic redemption on Delta metal for something like ATL-AUS, the redemption rate is usually terrible. I do occasionally still find decent redemptions at better than 2¢ per mile on DL metal, but they are rare.

    SkyMiles is a disappointing program in general. If I don’t get at least 1.5¢ per point, then I just buy the ticket, either with cash or thru a credit card with 1.5¢ redemption or better. (CSR or Amex Biz Platinum pay w/points + 35% back)

  15. It almost never pays to put daily spend on an airline-specific credit card, at least “for the miles.” Would anyone reading this blog do so? And how the heck would you accumulate 88,000 for 2 of these tickets with regular spend — much less many more miles for a premium cabin award? BTW, that’s why I always laugh when I see blog posts like “enough biz class award seats for your entire family.” Except in unusual circumstances, who’s accumulating 500K+ miles in an airline program (and why?).

    So unless you’re a manufactured spending fiend, I suspect most readers might get a Delta credit card or two and, with the sign-up bonuses, have about 100 to 150K Skymiles in their account. In such circumstances, a 44K award to Australia looks like a GREAT redemption. No?

  16. Put another way, it only costs 50,000 UR + $0 cash for this ticket. So Ultimate Rewards has arguably the better redemption for Delta international economy than Delta does (during a sale, no less). Makes Amex MR look pretty shabby relative to Chase UR.

  17. @FarNorthTrader,

    Unless the 44k Delta miles came from a Delta Amex card sign-up bonus. No need to spend $44,000 to get the 44k points, more like $2k or $3k 🙂

  18. Chopsticks – like I said before, tens of thousands (maybe more) of Delta flyers out at least $25,000, $30,000, $50,000, or $60,000 annually on their Delta cards for the annual elite qualification mile boosts. This is easily evident on Flyertalk. In that case, putting “regular spend” on an AMEX card can be absolutely worth it.

  19. The way I plan on doing this next year is using the “pay with miles” feature that you get with the platinum and reserve SkyMiles Amex.

    Every 10k miles nets 100$ off the ticket. If I use 30k miles to knock it down to something respectable that you fee like paying, you can still earn the MQM and regular miles.

    It can be a great value especially on the Delta Vacation packages where you can use the same feature.

    I’m a platinum and am doing ROC-NCE and ROC-SNN flight and hotel for about 1k per person using this. That’s where the real value lies

  20. I was a road warrior starting in the 80s up to 2004 when I retired (Delta million miler). I used up my miles afterwards on multiple Skyteam RTW trips. Before the program changed so drastically, status was only from miles earned flying. I was platinum one year and got upgraded every single time, including international. Gold every other year and was upgraded 90% of the time. Now I fly Delta very rarely, but did get a Delta One r/t award from Atlanta to Tokyo last year for 180K. Hoping for another such sale this fall to use up my last 190K.

  21. Yesterday I booked two roundtrip Delta One tickets from Bos to Syd (Delta One BOS-LAX, Suites LAX-SYD) in August for 240K each.

  22. Okay. You can hate Delta. But for us, Europeans, with the lack of MQD, this is the easiest SkyTeam airline to gain status. AF/AZ/KL gives 100% Delta MQMs even on deep discount economy. I reached platinum status with 2000 USD spent on flights. All my flights are international, so lounge access is consistent. At this point, I don’t care about the value of miles.

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