The DoJ has settled and will not oppose American from merging with USAirways. The merger is expected to close in December though the USAirways brand will still remain separate well into 2014.
What does that mean for you?
1. Less competition means higher airfares for consumers. Sure Southwest and JetBlue may pickup a few slots/gates being vacated by the new American but those are hardly cheap carriers anymore. They offer more frills than the network carriers.
2. The Star Alliance loses a key partner as the American brand and AAdvantage program will survive in the OneWorld alliance. USAirways has a strong east coast presence and great domestic first class availability. They are also a great option for flights to Israel. USAirways will exit the Star Alliance on a yet to be determined date in the first few months of 2014.
3. The USAirways program with its generous award chart and all of its generous routing rules will be swallowed by American’s program.
-American has very strict routing rules, they don’t allow you to fly to Asia via Europe or to Australia via Asia or Europe. USAirways allows you to fly pretty much anywhere via anywhere so that it’s possible to fly to Asia via Tel Aviv for just 60K in coach or 90K in business with no fuel surcharges.
-USAirways doesn’t require an award ticket to be on a published paid fare routing while American does.
-USAirways doesn’t have a maximum amount of miles you can travel while American does.
-USAirways allows a free stopover anywhere while American only allows it at the North American gateway city.
-USAirways agents also aren’t very good at geography-at least 2 DD readers have booked tickets to Johannesburg via Tel Aviv and were charged only the amount needed to fly to the Hawaii.
-We’ll also lose 35K round-trip off coach peak awards to Europe and South America, 25K off peak awards to the Caribbean, and 60K off-peak business awards to South America.
-USAirways doesn’t charge fuel surcharges while American levies heavy fuel surcharges for travel on British Airways.
-On the positive side American does allow one-way awards and even gives a free stopover at the North American gateway.
4. American currently has 2 award charts, a region-based award chart good for all partners and a distance based OneWorld chart. Both offer very good values and are ripe for a devaluation. Expect one as soon as a combined program is announced.
5. There will likely be a period of time where you can transfer miles back and forth between USAirways and American while they both still have their current generous award charts. Take advantage of this while you can.
6. DansDeals broke the news back in January that ANA had stopped collecting a fuel surcharge for travel on United and USAirways. That post has lots of info on their program.
They have an awesome award chart (38K miles to Europe, 60K to Israel, etc) and allow 4 free stopovers and it really stings to lose the USAirways option though at least there’s still United.
Same story with Singapore as I wrote about here. If you have those miles you’ll be losing a valuable surcharge-free partner though United remains an option and of course those miles are awesome for redeeming on Singapore business, first, and suites class.
Lufthansa charges a fuel surcharge on most airlines except for USAirways, so you may want to redeem those miles for travel on USAirways before they leave the Star Alliance. I wrote about their program in this post about Barclay bank cards. There’s no fuel surcharge on domestic United tickets but once you cross the ocean Lufthansa charges a fuel surcharge to travel on United.
-Note that United miles aren’t affected nearly as much as these program as they never collect a fuel surcharge for award travel. In fact once USAirways is gone they are one of the only carriers that can still say that.
7. The easiest way to earn what can possibly be a lifetime of Star Alliance Gold elite status is going away. I wrote about Aegean Star Alliance gold status in this post. Now the Aegean gold program isn’t changing but Aegean doesn’t credit miles or only gives partial credit for cheap airfares on most airlines. USAirways is the one exception where you can almost always receive full mileage credit with Aegean, even on deeply discounted airfare rates.
Star Gold gets you and all of your companions 1, 2, or 3 extra free bags and free lounge access at some 1,000 affiliated lounges worldwide when flying on the Star Alliance. In fact Aegean Star Gold even gives free United domestic lounge access-something that United Star Gold doesn’t even offer to their own elite members.
8. You can transfer Starpoints to anyone’s USAirways account, the names don’t have to match. American requires that the names match.
Though you can still transfer Starpoints to another Starpoint account with the same address on file.
Both offer 25,000 miles for every 20,000 Starpoints transferred.
9. American is effectively banned from flying to Israel thanks to leftover TWA pension obligations. If they fly a plane to Israel it would likely be repossessed by those who feel that American assumed TWA’s liabilities and owe them lots of money with interest.
They are trying to settle those issues but if they don’t we may see the end of the USAirways flight from Philadelphia to Tel Aviv.
If they do work out those issues expect American to shift the flight from Philadelphia to JFK and/or Miami.
Beware that El Al may decide to sever its relationship with American if they become a competitor and you may no longer be able to use American miles on El Al. Though if El Al would do that they would lose codeshare access to other US cities that they get from American though they can always set one up with an airline like JetBlue.
10. Operating hubs or major operations in Charlotte, JFK, LGA, Miami, Philadelphia, and Washington DC simply can’t be sustained. There will be cutbacks in capacity and hub downgrades which will lead to higher airfares and fewer award seats.
Phoenix also seems redundant between Dallas and Los Angeles.
11. Bright side: There will be many more flights that you can use your BA Avios for thanks to the USAirways network joining American. So good news for fans of those BA short-haul awards.
Those are my thoughts. What are yours?