Don’t Transfer Amex Points To Avios Without Reading This Post!

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Earlier Ben posted that American Express Membership Rewards is offering a 40% bonus on points transfers to British Airways Executive Club through September 17, 2017. This is effectively a 75% increase over the previous transfer ratio, and can be a pretty fabulous deal.

I’ve seen lots of excited buzz about this promo (and I’m excited too), but haven’t seen nearly enough caveats surrounding who should or shouldn’t take advantage of this deal. Several OMAAT parents have sent enthusiastic texts this morning about their new Avios balances, so before anyone else gets ahead of themselves, I figured I’d go through the potential pitfalls.

British Airways isn’t a beginner’s currency, and there are definitely some things to watch out for.

Avios aren’t equal to Amex points to start with

Keep in mind that Ben values Membership Rewards points at 1.7¢ each, but British Airways Avios at only 1.3¢ each. That would make 1,000 Membership Rewards points worth ~$17, and with the transfer bonus you’d get ~$18.20 worth of Avios.

So the increased transfer ratio is certainly a potentially great deal, but not automatically a great deal.

Ultimately, it comes down to how you’re going to use those Avios. Because I’ve seen people suggesting some really horrible options.

Terrible, no-good, and borderline-depressing uses of British Airways Avios

Not to put too fine a point on it, but there are some downright-lousy ways to use British Airways miles. This is somewhat true of all mileage currencies (buying Coronas in the SkyClub), but with British Airways the bad deals aren’t as intuitive, and can be exceptionally poor values.

These include:

Why aren’t these good deals? Because British Airways has a progressively punitive award chart.

To start, the pricing is distance-based, so the further your flight, the more miles you’ll pay. If you were going to or from London, for example, the zones would look like this:

Avios-Reward-Zones-1

You also pay for every segment, so if you fly from Los Angeles to New York, and then New York to London you pay for a Zone 4 award and a Zone 5 award. This adds up quickly if you aren’t traveling between hubs.

Beyond that, the mileage costs increase dramatically for premium cabins. Business class requires double miles. First class is charged at triple the rate of economy. (For longhaul planes with Premium Economy, business is triple and first is quadruple, so this can be even more egregious). 

And then you add in peak and off-peak pricing!

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Zone // Flight Distance Economy
Off Peak // Peak
Premium Economy
Off Peak // Peak
Business
Off Peak // Peak
First
Off Peak // Peak
Zone 1
1-650 miles
4,000 // 4,500 5,750 // 6,750 7,750 // 9,000 15,500 // 18,000
Zone 2
651-1150 miles
6,500 // 7,500 9,500 // 11,250 12,750 // 15,000 25,500 // 30,000
Zone 3
1151-2000 miles
8,500 // 10,000 12,750 // 15,000 17,000 // 20,000 34,000 // 40,000
Zone 4
2001-3000 miles
10,000 // 12,500 20,000 // 25,000 31,250 // 37,500 42,500 // 50,000
Zone 5
3001-4000 miles
13,000 // 20,000 26,000 // 40,000 50,000 // 60,000 68,000 // 80,000
Zone 6
4001-5500 miles
16,250 // 25,000 32,500 // 50,000 62,500 // 75,000 85,000 // 100,000
Zone 7
5501-6500 miles
19,500 // 30,000 39,000 // 60,000 75,000 // 90,000 102,000 // 120,000
Zone 8
6501-7000 miles
22,750 // 35,000 45,500 // 70,000 87,500 // 105,000 119,000 // 140,000
Zone 9
7001+ miles
32,50 // 50,000 65,000 // 100,000 125,000 // 150,000 170,000 // 200,000

So a first class Cathay Pacific flight between Los Angeles and Hong Kong (7,260 miles) would require 200,000 Avios per person each way. That’s ridiculous.

In comparison, booking the round-trip through AsiaMiles, which is also a transfer partner of Membership Rewards, would require just 180,000 points. And you’d get better availability!

(Update: apparently LAX>HKG awards are pricing at Zone 8, despite the flight distance, so it’s “just” 140,o00 each way. That’s still too many miles though).

Alaska awards to Hawaii are a similar story. Alaska codes their front cabin as “First class” and their North America to Hawaii flights all fall within Zone 4.

That means you’d pay 50,00 Avios for a non-stop one-way in first! Even with the promo you’d be spending ~72,000 American Express points for a round-trip, which is hard to justify given the retail price of those flights.

If your travel goals consist of any of the above options, Avios are probably not going to be the best points currency for you. Which is fine, because if you have American Express Membership Rewards points you have oodles of alternatives. That’s the point of a flexible points currency, after all.

Potentially decent values, but super-limited availability

Ruling out the first group of options still leaves plenty of ways to use Avios. But there are some potential snags that can make a few of them impractical based on the extremely limited award availability offered by the partner airlines that serve the routes:

If you find award space on any of these flights, that’s great! Fabulous uses of Avios, and with the transfer bonus these can be great deals.

But don’t assume they’re going to be available. Check space, then transfer your points.

So how should you use Avios?

Now, don’t get me wrong. There are some fabulous uses of Avios out there, including:

  • Reward Flight Saver trips on British Airways (more shortly)
  • Shorter non-stop flights on partner airlines that would otherwise be expensive
  • Upgrades on British Airways

These options can all give you a great value for both your Avios, and your American Express points.

Reward Flight Saver

The Reward Flight Saver scheme is one of the best uses of Avios. Basically how this works is you pay the miles as per the chart, but a flat-rate for the taxes and fees:

  • A one-way British Airways flight in Europe is $27.50 in economy and $40 in business, plus the Avios
  • Comair flights in southern Africa are $44 in economy and $50 in business, plus the Avios

To see how this works in practice, let’s look at flights between London and Madrid. These are Zone 2 flights, so will require 7,500 Avios in economy, or 15,000 Avios in business.

The British Airways flights are listed first, as usual. Selecting any of the economy fights with the Reward Flight Saver symbol shows economy taxes at $27.50:

Or $40 in business:

Meanwhile flights on Iberia have the same Avios requirement, but higher taxes and fees. Economy flights have $47.91 in taxes:


And business class is $64.44:

There are generally better options than using British Airways Avios for flights on Iberia regardless, but this provides a nice illustration.

You still want to check the math though, because these flights can also be super inexpensive to purchase.

Let’s look at flights between Cape Town and Johannesburg, for example. For a random date, British Airways is selling economy tickets for $75 all-in, or 7,500 Avios + $44 for Reward Flight Saver. Based on Ben’s valuations, that math looks like this:

(7,500 AVIOS x $.013) + $44 = $141.50

That doesn’t even factor in that you would earn miles on the purchased flights, so I would personally probably not use miles here.

Unless you’re traveling with a ton of checked bags, it’s tough to justify business class on a flight that isn’t even a thousand miles, but it’s an option. British Airways is selling that same one-way flight for $278, or 15,000 Avios + $50 for Reward Flight Saver:

(15,000 AVIOS x $.013) + $50 = $245

In this case you’d “save” ~$30 using miles compared to paying outright, so that could make more sense.

Of course, this math will all vary based on how you personally value your miles, so be sure to fill in your own numbers.

You should never speculatively transfer miles anyway

We harp on this often, and Travis addressed it specifically last time there was a transfer bonus between American Express and British Airways.

This 40% is a potentially awesome deal, and it’s hard-coded into the transfer ratio through mid-September. It’s not a glitch, or something you have to take advantage of today for fear of missing out. You have two entire months to look at ways to take advantage of the transfer bonus and determine if this is a good deal for you.

And if it is? Transfers between Membership Rewards and British Airways are instant. Like magic! You can find a great award option, transfer your points, and redeem your Avios in mere minutes. There’s no reason to transfer points “just because”.

Will I be taking advantage of this promo?

It depends. I currently have an abundance of Avios due to taking extreme advantage of the recent 3x promo on their shopping portal (if you have to re-tile a bathroom, getting 21x points certainly doesn’t hurt). So even if I believed in “stocking up” I don’t really have a need to.

But I frequently use Avios for my family, and will make a point of outlining some of that travel to see if I’ll need additional Avios. If a great deal comes up for British Airways business class I would potentially transfer extra points so as to upgrade to first.

Bottom line

The 40% transfer bonus between American Express and British Airways is a potentially great deal. As with everything though, it’s worth taking stock of your personal situation before going all-in on the promo.

How do you typically use Avios?



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