Aeroplan is the points plan formerly owned by Air Canada. It is now its own company, operating in Canada with American Express, CIBC bank, Air Canada, and others. Aeroplan makes money by selling points to these corporations, who then hope to attract more customers by handing out points.
The traditional thinking is that as times get tough, customers turn more to using up points -- a recession-proof business. Instead, Aeroplan says, customers now would rather buy airfares, which have become cheaper again. (Airfares peaked in September of last year.)
People commenting on the story, however, have other explanations:\
- * Flights purchased with points are not free, despite them being advertised in that manner. Cashing in 100,000 British Airways points my mother left me cost me just under $1000 for two tickets to Europe -- all fees, taxes, and fuel surcharges.
- * Routes available on points are inconvenient, despite them being advertised as being carefree. One trip through hell took us from Lyon (getting up at 3am), to Frankfurt (six hours waiting), Montreal, and finally Vancouver -- 29 hours airport to airport.
- Collecting points is expensive, despite advertising announcing the first 15,000 or 25,000 free. It used to take just 15,000 miles to attain Premier status with United Airlines; now it takes 25,000 miles. Air Canada now adds a surcharge to the ticket price when you want to collect points (they hide the surcharge as giving you a discount if you don't collect points).
- The value of points is inflating, so that the redemption value is as low as 0.4% in some cases. (Redeem $4 worth of product for every $1000 spent.) The cost of flights is increasing, from local routes that used to cost just 15,000 points now costing 25,000 or 40,000 points. Or, as Common Sense discovered, "You can buy an umbrella for 25,500 miles [from Aeroplan]."
- Airlines are no longer loyal to their customers, since they cancel all points after as little as one year of inactivity.
As Black Gold wrote, "One day I may donate them to some charity but for now, I don't have a problem with making Aeroplan and Air Canada feel financial pain for all the times in the past I have tried to use my points but was unable to because of some stupid condition or other."