YOUR MONEY-What US Air, AMR merger would mean for frequent flyers

Wed Apr 25, 2012 5:07pm EDT

By Mitch Lipka

NEW YORK, April 25 (Reuters) - If you've spent the last several years loyally flying American Airlines or US Airways, you're probably wondering what would happen to the frequent flyer miles you have built up if the airlines were to merge.

Consumers likely won't lose the miles they've already accumulated if a merger does come to pass. However, when other airlines have merged, consumers have lost some popular perks such as free upgrades and the chance to accumulate points while flying other carriers.

"All things being equal, I would expect a merged American-US Airways frequent flier program to be somewhat less generous than the two airlines' programs today," said Seth Kaplan, managing partner of Airline Weekly in Fort Lauderdale, Florida. "Maybe you'll need more miles for free tickets to certain regions, or maybe award seats will be more scarce, or maybe it'll be harder for elite fliers to get first-class upgrades."

Nothing about a merger is firm, and neither US Airways nor American, a unit of AMR Corp, would comment.

WINNER

Because of the sheer size of American's AAdvantage program, some experts say it would likely survive and the US Airways' Dividend Miles program would be folded into it. American's program claims 69 million members and US Airways has more than 30 million in its program, according to Colorado Springs, Colorado-based Frequent Flyer Services.

Those who hold credit cards linked to US Airways could expect an opportunity to convert their cards to one connected to American, says airline industry analyst Bob Mann of R.W. Mann & Company Inc.

Seth Kaplan, managing partner of Airline Weekly in Fort Lauderdale, Florida, and others who have watched frequent flyer programs change through mergers -- such as the United Airlines combination with Continental -- say the tendency is tighten up program rules just a bit. That's partly because when there's a merger, there are more people in the programs and fewer available seats for upgrades.

DIFFERENT ALLIANCES

A complicating factor for airline loyalists is that the two airlines are part of different frequent flyer alliances.

US Airways is part of the Star Alliance and American is part of oneworld. Many airlines participate in these alliances, which allow frequent flyers to earn and use miles on other carriers, typically those based on other countries.

If oneworld wins out, it could be a bit of a jolt to US Airways loyalists who have enjoyed the benefits of a partnership that includes United, the world's largest carrier.

Still, a US Airways loyalist set on converting a pile of miles into a trip on one of the Star Alliance's European carriers would have plenty of time to make that happen before any merger would take place, Kaplan says.

Though a merger is by no means certain, here are some strategies frequent flyers of the two airlines could consider:

- Start using up your miles, particularly if you're interested in flying on a carrier in an alliance that might not be available to you when the deal is done.

- Shop around to see whether another airline would meet your needs. But make sure the carrier flies the routes you most travel. This way when one of them starts dangling offers to lure you, you'll know if it's a smart move to shift your loyalties.

- Take advantage of deals still being offered in the current programs, such as free upgrades.

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