AA Shutdown Train Keeps Rolling Into The Twilight Zone
The AA shutdown train keeps rolling. Choo choo! At each new turn where they try to justify their ongoing existence, things get weirder. Enter the newest chapter of pettiness. Let’s look at this week’s episode of “How to know American Airlines hates everyone–especially their customers”.
AA Shutdown Backstory
We talked previously about AA shutdowns here. There were updates and finding out that Barclays had no clue about the shenanigans with Citi & American Airlines. The gist of the story is that American Airlines shut down the AAdvantage accounts of people who were getting a lot of credit card welcome offers / bonuses.
American Airlines Hates The Normal Traveler, Also
Now that we have this backdrop, let’s see what’s happening in the present. First, over the last 10 years, American Airlines had negative cashflow while also spending $15 billion dollars (billion with a B!) on stock buybacks to inflate their share price. CEO bonuses, good. Saving for a rainy day, bad.
Then, COVID-19 ravages the travel industry. No one is flying, and airlines want handouts to help them. Funny how I always get told I’m supposed to save money for emergencies and tough times. American Airlines didn’t save up. Crazy that I’m supposed to be more responsible than them, but this is a pandemic. They got some “pocket change” from taxpayers: $4.1 billion in grants and a $1.7 billion loan.
Since they’re looking for ways to inject cash into their revenue stream, ideas were brewing. The good idea fairy blessed them with this brutal idea: raise bag fees! Take a government handout on one day, screw your customers the next day. American Airlines increased bag fees from $60 to $75 each way during the middle of a pandemic with record low numbers of travelers. You and I know this isn’t because there are too many bags. It’s a way to increase revenue on the backs of the same customers who taxes provided the bailout.
AA Shutdown Team Says “Hold My Beer, Watch This”
Not to be outdone by the normal people at American Airlines, the corporate security team has reared its ugly head again. They couldn’t stomach the idea of some other department at American Airlines being the most evil, so they’re shutting down AAdvantage accounts again. Clearly, the team must justify its salaries and continued existence, so they must invent new enemies to fight. The latest target: people who earned miles from rental cars.
Dan’s Deals has a thorough article detailing data points on this. The gist is that AAdvantage corporate security is shutting down accounts just like before: with no notice or warnings. People who submitted car rental miles requests are being shut down and blamed for infractions that are over-exaggerated and basically just ridiculous. Were people abusing this to earn miles or reactivate expired miles? Possibly. Is the claim that receipts were faked and forged realistic? Not at all.
Final Thoughts
It sure seems like American Airlines hates you and all of its other customers, and this is just the latest way I’m seeing that in action. They aren’t saying it, but the message is coming across loud and clear. American Airlines is looking for ways to increase cash flow during record low travel spending by customers. The problem is, we are going to remember how companies treat us during this crisis. If you attempt to screw us over at every turn, just for an extra dollar, you will lose in the long run. American Airlines, in its anti-consumer bag fee changes and continued ridiculousness with AA shutdowns on frequent flyers, is shooting itself in the foot in the long run. It won’t matter how much money you can make on bag fees if you turn away all your customers by mistreating them in new and worsening ways at every turn.
HT: Dans Deals
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Never have understood why people chase miles. First you are limited to one source to redeem them and second the value put on them in redeeming is 1c at best when you can get cash back cards that give you real money, most 1 1/2 or 2 %. This on top of the difficulty in redeeming them and getting the flight you want.
I encourage you to look through the NUMEROUS posts about flights on our site and the 5-7c per point redemption value on these. Cash back is awesome if that’s what you want, but your understanding of earning miles is really really far off on their usability and value in redemptions. I’ve never had difficulty redeeming miles and never redeemed them for less than 2c on my worst day. If you’d like a primer on info, I’m happy to help.
13 billion in stock buy backs?
Nope try at least 15 BILLION
ALL OF WHICH FINANCED BY DEBT
https://prospect.org/economy/time-to-nationalize-the-airlines/
https://www.nytimes.com/2020/03/16/opinion/airlines-bailout.html
Thanks for that. The market watch article had a smaller figure.
You left out the new award change fees, which I think would affect more people than the potential rental car scam, but that’s literally last week’s news.
It’s hard to keep up with them sometimes…
I think there is more to this story on the rental car mile scam. If you read enough blogs and forums you will find people with no morals that will try to take advantage of schemes to steal as many miles as possible. The problem with shutting down folks like this is you might also sweep up folks that are innocent in this but like the mailers I think some people really had to be churning in these areas to get them banned for the most part. I’m not trying to defend AA as they have done some stupid stuff. Increasing the bag fee is very bad abuse but my guess is that some genius thought, hey we have such bad press let’s do it now instead of when we are actually trying to get on our feet in a month or two.
I want to raise a couple points from your comment.
1-you claimed that people have no morals for trying to get as many points as possible, but that basically applies to anyone in this hobby. I disagree with this.
2-you used the word “stealing” and I can’t figure out how this word applies here.
3-you said that people who got banned had to be “really churning” but I disagree, because there are plenty of data points showing that AA is overreaching a lot here.
4-“do it now while everyone hates is” is the only part I agreed with.
It’s too bad that AA has such scum leading the company. Instead of figuring out positive, win-win ways to make more profit, they always think of new ways to stick it to their customers. Unbelieveable. Just umbelieveable. Raising bagage fees during a lock down when no one is traveling. SMH.
“American Airlines raises bag fees on invisible customers who aren’t traveling” sounds like something from The Onion.
To AA, someone who violates their program is best defined as “a loyal customer who has the gall to actually attempt to redeem miles which we have gone out of our way to prevent them from doing”.
zing!
I think a shutdown where someone cannot join the AA program is crazy. They should have just re-adjusted the expiration date, expired the miles, cancelled any tickets purchased with the expired miles, and sent a note explaining their reasoning and a stern ‘don’t do this again!’
Or even a note like other programs (ex: Amex) have done. “32,000 miles were forfeited from your account because of ____. If you do this again, your account will be confiscated”. That seems reasonable. Unfortunately, AA seems bent on not being reasonable lately. Save $1 today, who cares if you lose $3mil from passengers tomorrow.