Bloomberg is reporting that Star Alliance is planning to launch a credit card this year that will enable cardholders to redeem miles across all 26 member airlines. Interestingly, the article specifically notes that you’ll be able to redeem points via the frequent flyer programs of any of the Star Alliance airlines, so it sounds like you’ll be able to transfer to all member airlines to take advantage of any Star Alliance award chart sweet spot.
On the one hand, it seems very surprising that Star Alliance would be able to get 26 airline programs to all play ball on what essentially sounds like a giant new transferable currency. In particular, I would be surprised that United would be cool with a competing US credit card that sheds too much light on the advantages of all of the other Star Alliance airline award charts. Maybe they see the ability to get some additional market share from other countries assuming that Star Alliance would launch similar cards in other markets down the road?
On the other hand, I am surprised that this hasn’t happened before. It makes sense to me that Star Alliance sees the money that gets thrown around from banks to airline programs and that they would think, “hey, how can we get a piece of that sweet pie?”. They clearly already have key working relationships with the loyalty programs of all 26 airlines, so it makes sense to me that they would see an opportunity to collect the money from the bank and pay member airlines whatever the negotiated rates are for award tickets, pocketing some of the massive profits that airlines ordinarily make by selling miles. Frankly, this just makes sense to me. I’d have thought that the reason it hasn’t happened already would be resistance from individual airlines who already rely on massive financing in the form of selling miles.
Bloomberg has no further details with regard to issuer, benefits, or earning structure. We’ll have to keep our eye on this to see what happens.
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I’d be all the way on this. My home airport is MCO. Only Lufthansa offers nonstop service to FRA but United typically has lower fares via IAD, especially award seats in Polaris across the Atlantic. Amex Membership Rewards don’t transfer to United miles but Chase Ultimate Rewards do. I find this a hassle. A single card to rule them all for my greatest alliance partner need would be most appealing. However, Germany still hasn’t solved its points-to-miles legislative challenge. What say you? http://viewfromthewing.com/lufthansa-says-points-to-miles-transfers-may-be-illegal-shuts-them-down
Not yet news…
Hope the issuer won’t be Chase or Capital one.
[…] HT: FrequetMiler […]
I’d have echo the sentiment of many here that this could open the door to across the board devaluation of all the programs
I agree. I’m surprised this hasn’t happened sooner. United was the first one back in the day to have a credit card to use solely for paying for United flights. Soon after, the banks got involved to offer airline CCs. The banks then figured they needed to get a bigger piece of the loyalty $$. United was the first to start the loyalty CC. Looks like they finally figured out it’s time to regroup and get back the $$ the banks are getting a portion of. With code sharing, Star Alliance is basically one airline anyway.
After an earthquake . . . there is often a tsunami.
One can’t help but think about award chart standardization and devaluation.
“What are the chances that this launches a secondary *A chart that’s universal across airlines and not consumer-friendly?”
This.
Although, mileage and points programs do have such a great history of making changes that are customer-positive.
What are the chances that this launches a secondary *A chart that’s universal across airlines and not consumer-friendly?
With asiana being taken over, which other hard to get miles that have significant sweet spots would this be particularly valuable? A3, lh?
hope Chase is not the bank behind the credit card
Hmmm… hopefully this isn’t the beginning of a broader and more universal Star Alliance award chart…or lead to an ANA deval…
I don’t think United would be that mad – any more than they are at Ultimate Rewards broadly.
I think it’s Chase who would be most angry (if they’re not issuing the new card) since it would effectively end their exclusivity with United.
Bilt also has United.
Bilt is not a major transferable points currency. Few people have the card and it’s more of a niche product. That’s like saying Marriott also has United.
Yes, Marriott is another example of the fact that Chase doesn’t have any exclusivity rights with United. Marriott could, however, have been grandfathered in from the SPG days but the Bilt deal was just signed last year, during the current Chase/United contact.
A lot of people (not readers of this blog) seem to think that this is how frequent flier points work already. (“I can transfer miles from United to Lufthansa, right?”) So they seem to just be leaning into consumers’ general ignorance and confusion.
Wow that would be amazing!