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Saturday,  April 20, 2024 9:13 PM 

American limiting loyalty points to direct bookings "marginalizes" the trade: ACTA

American limiting loyalty points to direct bookings "marginalizes" the trade: ACTA
(Pax Global Media/file photo)
Michael Pihach

Michael Pihach is an award-winning journalist with a keen interest in digital storytelling. In addition to PAX, Michael has also written for CBC Life, Ryerson University Magazine, IN Magazine, and Michael joins PAX after years of working at popular Canadian television shows, such as Steven and Chris, The Goods and The Marilyn Denis Show.

This article was updated on Thursday, February 22 at 7:32 a.m. EST

The Association of Canadian Travel Agencies and Travel Advisors (ACTA) is speaking out against American Airlines’ decision to limit traveller loyalty points accrual to direct bookings and a select group of travel agencies. 

The new policy "marginalizes a vast number of travel agencies and travel advisors," the association said in a statement Thursday (Feb. 22). 

“This move undermines the principle of fair competition and creates an uneven playing field, disadvantaging both consumers and many travel agencies,” said Wendy Paradis, ACTA's president, in a statement. “ACTA strongly objects to the recent policy change announced by American Airlines regarding its AAdvantage miles and Loyalty Points program.”

What's American doing?

American Airlines, on Tuesday (Feb. 20), revealed that it will soon stop awarding frequent flyer miles and Loyalty Points through its AAdvantage program to passengers who don’t book direct with the airline or a small number of partner carriers and “preferred” travel advisors.

“We want to make it more convenient for customers to enjoy the value and magic of travel,” said Vasu Raja, American's chief commercial officer, in a statement this week. “Not only does booking directly with American provide the best possible experience, it's also where we offer the best fares and it's most rewarding for our AAdvantage members.”

The new policy kicks in May 1, 2024. Tickets issued before that date, regardless of the date of travel, will earn miles and Loyalty Points no matter where the ticket was purchased from.

The airline didn’t reveal which travel agencies it would allow passengers to still earn AAdvantage miles and Loyalty Points through.

In a news release, the airline said it will share a list of “eligible preferred agencies” on in late April.

Even with preferred agencies, American said it will only reward miles and points on Basic Economy fare tickets when booked directly through American or eligible partner airlines.

Corporate travellers won’t be impacted by the changes. 

ACTA urges American to reconsider

Paradis said ACTA views the change as a "significant departure from equitable business practices and a direct threat to the healthy competitive environment that has long benefitted consumers and the travel industry alike." 

The association is urging American Airlines to reconsider the policy change and work collaboratively with the entire travel agency community "to foster a healthy, competitive environment that benefits all stakeholders."

Pushing agents out

The move is part of a shift by airlines to move away from using travel advisors – and paying them commissions – and bring ticket sales in-house. 

About 60 per cent of American's ticket sales are made directly through the airline, Scott Chandler, vice-president of revenue management at American Airlines, told the Associated Press. 

“The old way of booking a ticket relied on agents having a ton of experience and understanding product attributes,” Chandler said in an interview with the outlet.  “The old technology doesn't let us explain things very well, and it is a little more confusing for customers when we introduce new products.”

Higher bag fees

American Airlines also said Tuesday that checking a bag on a domestic flight will rise from $30 now to $35 online and $40 if purchased at the airport.

The fee for a second checked bag will rise from $40 to $45 both online and at the airport.

The airline’s new bag fees for Canada and short-haul international flights are $35 for first checked bags and $45 for second checked bags purchased online or at the airport.

American last raised its bag fees in 2018.

All AAdvantage status members will continue to receive complimentary bags on American Airlines flights. Most AAdvantage credit cardmembers* also get their first eligible checked bag free on domestic American itineraries.

Customers who purchase premium cabins on domestic and international flights will continue to receive complimentary bags, the airline said.

American's pet-in-cabin fee is also now $150 for tickets purchased on or after Feb. 20, the airline said.

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