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Published on Tuesday, April 14, 2020

Airlines plan to pre-sell miles to bring in much-needed cash






Airlines are taking increasingly drastic and creative measures to monetize whatever assets they can.


United Airlines and Delta Air Lines are looking to sell loyalty miles in bulk at a discount to their credit card partners, according to the Wall Street Journal.


The airlines have been in discussions about selling miles in advance to their respective partners JPMorgan Chase and American Express.


Citing people familiar with the discussions, no agreements have yet been reached, the WSJ says.


Co-branded card loyalty programs generate billions of dollars of revenue particularly in the corporate travel market, but it could be many months before business travel takes off again.


Banks and credit card companies regularly buy miles to reward high spending card holders.


"If airlines start seriously talking about mileage presales, we'll know things are particularly dire," said Joseph DeNardi, an airline analyst at investment bank Stifel.


According to DeNardi, American Express spent about $4 billion last year buying miles from Delta.


Global airlines have been hawking slots, real estate and owned aircraft as collateral to secure billions in loans to ease cash-flow worries.

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  • idiots

    So do the airlines think their customers are idiots? They pre-sell miles then jack up the requirements to get frequent flyer tickets. This is just another scam by the airlines - not unlike charging for luggage (which if you recall was supposed to be temporary). Airlines were having record breaking quarters until Covid19 - its just too bad they squandered their profits by likely paying themselves too much. Where did all that money go?

    By Howard Moses, Wednesday, April 15, 2020

  • Beware

    No Airline that sells Points/Miles should be allowed to sell them and yet still have an expiry mandate. Also there should be a regulation preventing Airlines devaluing the redemption policy for at least 2 years. Members who bought points/miles in the last 2 months should also be able to obtain a refund much in the same was as folks who paid cash.

    By Lord Kent, Wednesday, April 15, 2020

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