Sunday, May 18, 2014

USAirways MasterCard Disintegrates

Bye Bye Benefits
Observations from a Two Million Miler
Updated 6-2014
Updated 10-2014
Updated 1-2015
Updated 4-2015

Item #1: 2015 Changes to the USAirways MasterCard
For years about 30-45 minutes before landing US Airways passengers have endured a long sales pitch for credit cards with the following benefits:
1. First bag free
2. Boarding in Zone 2
3. Check in using First Class lines 
4. Bonus miles for signing up  
5. One annual visit to the US Airways Club
6. Two annual $99 companion tickets
7. Additional points when used for certain purchases
8. 10,000 preferred qualified (renewal) bonus miles with annual spending of $25,000.
9. Waived $25 in award redemption fees and reduced points needed for awards by 5,000 miles. 
10. First year no fee, with an annual fee of $75 afterwards (now $89).

In fact a visit (this evening) to US Airway's website still pretty much touts the same benefits and, as a multi-million miler, I have always loved these cards carrying two for years; one for business and one for personal expenses.

In 2014 I recieved a glossy mailer saying my "World Just Got Bigger". I opened it only to realize it was actually a notification putting a happy spin on the fact that the US Airways MasterCard would soon have severely curtailed benefits starting in 2015. Translation: in 2015 these cards would align with the old Citi AAdvantage cards (i.e. kinda crappy).

Despite the website still pitching all of the above benefits, the mailer said the 2015 card benefits would  be reduced to the following:
1. Free bag benefit (extended to 3 guests traveling with you).
2. Boarding with Zone 2.
3. Points for usage.
4. 10% of your redeemed miles will be rebated (up to 10,000 miles per calendar year)  
5. $100 off a future flight if you spend $30,000 in a year ($100 back for spending the equivalent of 40% a new Tesla?)

1. The club pass 
2. The $99 companion pass
3. Preferred qualified spending bonus after spending $30,000
4. The 5000 discount on reward redemptions
5. First class check in

Roadboy's take.....
Now is a good time to examine alternative cards.

Some good choices to consider:
1. The Marriott Rewards visa card ($85 Annual Fee). A perfect card for international travel as it is chip and swipe enabled and has no foreign transaction fees. It also gives one free hotel night a year.
2. United's Explorer card also offers many of the same benefits including 2 club passes annually and has no foreign transaction fees.
3. Wells Fargo American Express Propel 365 Traveler with no foreign transaction fees and a host of other benefits.

What should you look for in a new card?

Chip and Swipe
Europe uses chip and PIN cards since they offer superior fraud protection.
Although credit card fraud has touched nearly every American our banks and retailers refuse to upgrade to modern cards with Chip and PIN protection. 

For now the best American's can get are chip and swipe cards. These are cards that work in both European "slide-in" PIN card readers and in America's quaint swipe readers.  Before you leave for an international trip be aware that old style American issued swipe only cards (cards without the chip) are now routinely refused elsewhere else in the world. And, ship and swipe cards typically do not work in automated vending machines (like where you buy subway tickets).

Foreign Transaction Fees
When first timer's return from Europe or Asia they are frequently stunned to see massive "foreign transaction" fees on every purchase.

For Roadboy, the savings of these fees alone makes up for higher annual renewal fees.

Awards That Work on Any Airline
Since many airlines (British Airways, Delta, Southwest and United) have trashed their distance based "Loyalty" programs (now awarding elite status based on how much you spend), I first thought I'd start accumulating points on cards such as the ones with their own rewards programs, such as American Express points. 

First I got a costly new Wells Fargo American Express Propel World Traveler card and...

Update 6-2104
During my recent two weeks in Europe (Ireland and the UK) this summer the new AE "Propel"was refused twice because the businesses simply did not accept American Express. 

We also experienced a comedy of errors with AE's customer service. When we applied for the card we were promised two cards: one for me and one for my daughter who was relocating to London for 6 months.

It took three attempts to get the cards sorted out. First they lost the paperwork. Then they mailed the cards to the wrong address. Then we got them - names misspelled. 

Despite the exorbitant fee, I was so hopeful for these cards. 

AE - Get please your S?#t together!  I won't renew the "World" one.

Update 4-2015: Wells Fargo AE Cards
So the time came and I cancelled my Propel World card (well before the expensive annual fee kicked in). While on the phone the rep described the features of the Propel 365 card. It offers rewards points, no foreign transaction fees and has a real chip and PIN (first American one I've found) all with an annual fee of $45. I decided to give the 365 card a try. It also offers 1 free year and offers 20,000 AE Rewards points if you spend $3000 in the first 90 days.

Update 10-2014: US Airways Mastercard
Well I called Barclays to confirm what to expect when my second US Airways card renews in February 2015. Here is what I was told: 

1. Barclays Bank cards will be marketed on US Airways until the merger of the frequent flier program is complete. After that Barclay's will no longer be allowed to issue new cards. So existing Barclay's Master Cards cards will Not become citi cards. Instead Barclays is launching an American Airlines "Aviator" card to select existing US Airways mastercard customers. So, Barclay's cardholders will be renewed with the newly launched "Aviator - Red" card. A visit to the Aviator site disclosed that the new Aviator Red card still costs $89 a year.

2. The agent said there had been "a lot" of pushback from current cardholders as a result of the announced benefit roll back. As a result Barclays is extending some current benefits well into 2015. So if your renewal is in the first quarter of 2015 you'll likely get one more companion certificate and club pass. But that will be it. 

3. The 10,000 regular mile conversion to preferred qualifying miles benefit ended December 31, 2014. 

So Roadboy's most valued card benefit is gone. But, since I know it, I now use my better (i.e. Marriott) card for all large charges.

4. With the new card (unless you fly 100,000 actual miles a year), the impending adoption of American's three level elite status means there is no good reason to continue using the US Airways card (or remaining loyal to US Airways) once you pass 50,000 qualifying miles. For example at the time of my call in October I was at 60,000 miles on US Airway's. Looking out to year end I knew I'd fall well short of earning the 100,000 miles needed to reach US Airways Chairman or Executive Platinum on AA. So anything I'd earn between 50,000 and 100,000 still results (after merger) in me dropping to platinum on AA (as they have nothing between 50,000 and 100,000). From now on if I know I can;t make the 100,000 in a calendar year I'll just go to 50K and use the balance of my year obtaining elite qualifying miles on other carriers. 

Loyalty is a 2-way street.

5. So lets say you want a card with (sort of) the same benefits you used to get today? Barclay's will / is offer(ing) some current customers a new $195 / year "Aviator Silver" card. So, for a bit more than twice the annual fee of the (soon to be Red) card, the new Silver card will restore some of the benefits of the current $89 master card. 

Confused yet? Well here's the rub. The Silver card will offer the 10,000 point conversion only if you spend $40,000 a year - I am not making that up. Companion passes return if you spend $30,000 in a year. The Silver card will also (finally) be chip and swipe enabled and it will not charge foreign transaction fees.

Another Option....

Despite comments to the contrary, I'm sure that once the merger is sorted out the "New American" will jamb the money based point system British Airways, United, Delta and Southwest have all adopted. IMHO AA / US Airways is holding off because it is just too complex for them to implement it during the merger. Once the merger is complete they'll feel more free to alienate their best customers.

Stand by....

Update 1-2015:
Barclay's must be starting to realize they have pissed off their best customers. Today's visit to the Barclay MasterCard site had a pop-up announcement informing me that the card no longer imposes foreign transaction fees! 

But....without a chip, the card will still get rejected as much as it gets accepted. So, I called Customer service and was found out the new AA Aviator cards have a chip. 

Al always Roadboy advises you NOT to rely exclusively on one card outside the US. Pack two cards with chips AND no foreign transaction fees.

And have a great time!  

Roadboy's Travels© 2014/2015

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