American Airlines is making major changes to its loyalty program in 2023. The changes affect both the status arm of the program and award redemptions for travel on American Airlines flights.
Let’s go over the upcoming changes to award redemptions on American Airlines flights, which is set to join the suite of fully dynamic loyalty programs at some point in 2023.
Dynamic Pricing on American Airlines Reward Flights
American Airlines has announced that its AAdvantage loyalty program will become fully dynamic in 2023. Dynamic pricing will only affect award flights on American Airlines flights booked with AAdvantage miles.
As we’ve seen with many loyalty programs in the recent past, the move away from fixed pricing and towards dynamic pricing is supposed to make award flights more closely resemble cash prices.
Like Aeroplan does with Air Canada flights, American Airlines offers every available seat on AAdvantage redemptions, and it will continue to do so under the upcoming dynamic pricing model.
American Airlines has announced that changes will be coming 2023, but there isn’t a set date for the change to take place. It’s likely that the move to fully dynamic award pricing on American Airlines flights will take place in the latter half of the year, and we can expect to have more details about the change provided well before then.
Interestingly, American Airlines has promised a simplified award chart in the announcement of the upcoming changes. After all, dynamic pricing usually means that award flights will closely match the cash prices, so it’s not very clear how useful a simplified award chart might be.
It’s quite possible that the award chart will resemble the Aeroplan Flight Reward Chart for Air Canada flights. Rather than award flights having a fixed cost, as we see with partner airlines, there will likely be a range of prices that you can expect to pay, while allowing for some variance on either end of the spectrum.
The move to dynamic pricing will do away with MileSAAver and AAnytime awards, which the airline currently uses. MileSAAver flights come at a lower price, while AAnytime awards are available at different tiers of higher costs. Note that Web Special fares, which price tickets by demand and seasonality, will continue to be offered under the upcoming iteration of the program.
To be clear, partner redemptions are unaffected at this time, and no announcements have been made regarding any forthcoming changes to redeeming AAdvantage miles for flights with partner airlines.
What Are the Implications of the Move to Dynamic Pricing?
The big question is if these changes really even matter, and if collectors of American Airlines AAdvantage miles should liquidate their accounts by locking in bookings as soon as possible.
It turns out that the upcoming changes in 2023 make very little difference to the way we’ll redeem American AAdvantage miles.
Recall that the best way to redeem AAdvantage miles is on partner airlines, such as Qatar Airways Qsuites awards to Africa or Air Tahiti Nui business class from North America to Tahiti. Since the move to dynamic pricing won’t affect partner airlines, there aren’t any indications that the sweet spots are about to disappear.
Furthermore, nearly all American Airlines flights are already subject to some form of dynamic pricing, since the pricing of American Airlines flights very rarely adheres to the published award chart.
For example, take a look at the current published award chart for flights in business class and First Class departing from North America.
According to this chart, the maximum number of points that should be required for a one-way flight from North America to Europe should be 135,000 AAdvantage miles with an AAnytime Level 2 award.
Indeed, it’s not difficult to find prices that are over double or even almost triple that price.
When redeeming AAdvantage miles for flights on American Airlines, the best prices can be found with Web Specials. Web Specials are already dynamically priced, and are often cheaper than what’s listed on the published award chart, which is exactly why they’re such a popular redemption.
Moreover, since American Airlines is still planning to publish an award chart once the program switches to dynamic pricing suggests that award prices won’t exactly correlate to the cash price in the same way that Delta Skymiles does. For example, it’s unlikely that we’ll see a value of 1 cent per point for AAdvantage miles under the revised program.
The only worrying part of American Airlines’s announcement is that making the move to dynamic pricing official and permanent for its own flights brings them one step closer to making all redemptions, including those on partner airlines, dynamic. After all, American Airlines is the only major US airline to maintain an award chart for partners, after both Delta and United have moved to fully dynamic pricing on award bookings in the recent past.
At some point in 2023, American Airlines AAdvantage will be moving towards fully dynamic pricing when redeeming miles on American Airlines flights. There will be a new and simplified award chart to accompany the changes, but it’s unclear what utility the chart will have under dynamic pricing.
Partner redemptions appear to be unaffected by changes at this time, and they remain the best way to redeem American Airlines AAdvantage miles, especially for long-haul premium cabin itineraries.
The move towards dynamic pricing likely makes very little difference to most AAdvantage members, as the vast majority of American Airlines awards are already priced on a dynamic basis.
We’ll be sure to keep an eye out for any future announcements about the timeline of the changes and how they might affect redemptions to book before then.