American AAdvantage Credit Cards Losing 10% Rebate on Miles Redeemed

I’m hearing that Citibank should be notifying its customers today of benefits changes that go into effect May 1 for the Citi® / AAdvantage® Platinum Select® card

Last summer Citi introduced two changes to their primary American Airlines co-brand credit card.

  • Earning 2 points per dollar at restaurants and gas stations
  • An annual $100 American Airlines flight discount after $20,000 spend within a year provided after card renewal

This annual flight discount for $20,000 spend on the card is being increased to $125. Either they find this is so successful they want to do even more here, or it’s not moving the needle on customer spend at all and they think $25 more will make a difference.

Unfortunately the card’s benefit of rebating 10% of AAdvantage miles redeemed (up to 10,000 miles back) each year is going away and you don’t have long to take advantage of it. American tells me that redemptions “on or before April 30, 2019” only will earn this rebate.

The challenge this creates is that the card is good for a nice initial bonus, and good for benefits (like earlier boarding and free checked bags) but doesn’t do a lot to encourage spend. To my mind the $125 flight credit doesn’t get you there. So they’re not making the card more attractive.

The loss of the 10% rebate on redemptions applies to Barclays-issued cards as well, though those are getting an even bigger refresh whose details I shared on Wednesday that help offset earning up to 10,000 fewer points per year through the benefit.

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 »

More articles by Gary Leff »

Pingbacks

Comments

  1. The 10% miles rebate is the main reason I keep the card. That plus the fact, that as a Citigold customer, they waive the annual fee. If that perk ever goes away I’m done with the card. Besides, I put very little spend on it anymore.

  2. When it says redemptions on or before April 30, does that mean travel completed by April 30 or travel booked by April 30?

  3. I think the $25 is nothing more than a meaningless gesture that is never, ever used to mask the huge degradation of benefits that is going forward on these cards.

  4. I was under the impression that more than one Citi AA card offers the 10% miles rebate. If so, does this policy change apply to all Citi AA cards?

  5. Hopefully the old US airways card that converted over keeps the annual 10,000 mile bonus. That will probably;y be removed at some point.

  6. Both Barclays and Citi cards losing the 10% mile rebate benefit is a critical blow to AA’s credit card portfolio.
    IMO this was the single best benefit of the Red Aviator card and the Platinum Select card.
    What a shame.

  7. @Andrew you clearly missed the news the 10k annual mile bonus is going away. See Gary’s post on the Barclays AA changes for a day or two ago. It sounds like most folks will get one more bonus.

  8. I don’t fully understand how these cards are marketed. I think my problem is that I overestimate the intelligence and sophistication of credit card customers. Logic would say you’d want to strongly encourage spending and renewal behaviors on these airline credit cards. You’d put a good chunk of your marketing money into those things: not just pay a huge money-losing sign-up bonus and simply hope that customers renew. Yet, these airline cards generally pay huge sign-up bonuses but aren’t very good at providing on-going benefits to cardholders. If you’re a very frequent AA customer who doesn’t have gold status for some reason (like the minimum spend), the free bag and earlier boarding privileges are useful. But this would seem like a narrow slice of the customer base — the small “middle” if you will. Otherwise, who is renewing this card? The 10K award reimbursement would seem to be a HUGE incentive for true loyal AA customers (like elites) to renew the card. Without that incentive, why would they hold the card? Logically, they wouldn’t. But maybe logic is overrated on this stuff.

  9. How can they cut benefits mid-card year? If you paid the annual fee last month, they can cut the cards benefits just 3 months into the card year?

  10. The way that I see this, it’s now a ten percent devaluation for American Airlines miles.

  11. @philco, Thanks, I clearly did miss it. It was nice while it lasted and even better when they waived the annual fee which they did most years

  12. I can’t see why someone who flies AA a lot would now choose the $95 Citi card over the $0 Mile-Up unless you need free bags.

    For $95 you get:
    – reduced mileage awards (which I’ve never been able to use)
    – no foreign transaction fees (which you can get on free cards)
    – free bags / preferred boarding (which I get from elite status)
    – $125 discount after spending $20k. It’s really $30 after the annual fee.

    Mile-Up also earns 2x at grocery stores which is better for a lot of people than 2x gas and dining on the $95 card.

  13. It looks like all these changes are driven by AA management to sell more AA miles to credit card banks while devaluing AAdvantage at the same time. Nice try but after the changes the cards will be useless except the signup bonuses.

  14. My renewal on the credit card is in December. I do not think I will renew if something does not change for the better.

  15. The 10K miles discount was one of the reasons I kept this card ..
    The AADvantage product is being further devalued by this – it’s already hardly worth the effort
    to build up miles as it’s now double the amount if you want decent non-stop flights – or –
    you travel via connection for what normally should be 3 1/2 hrs trip to become 8-10hrs forr
    domestic travel

  16. AA affinity credit cards have become the Motel 6 of the miles and points rewards. I completely agree with other reviews that AA miles have become both “worth less” and worthless. As a result my spending on Citicard has decreased from $3-5,000 a month to $26.00 last month. I’ve found two other credit cards that give me much more value than the perceived F or J seats that AA miles will buy. And using AA miles for anything other than a seat on an airplane, if you should happen to stumble upon one, rewards with less value than a low percentage cash back card.

  17. Mileup doesn’t provide rental car damage coverage, roadside protection or travel insurance.
    …there may be other exclusions compared to the Gold card

Leave a Reply

Your email address will not be published. Required fields are marked *