How do the New Spend Minimums Affect the Govt Traveler?

So the buzz all last week was about United following Delta’s lead in requiring a minimum amount of spending commensurate with the status level you want to achieve.  For both airlines, you must spend an average of 10 cents-per-mile(CPM).  Readers of this and other blogs know that a good fare for mileage runs is 4 CPM.  That is a pretty significant gap.  Obviously, this requirement will stop the folks who achieve status solely through gaming the system with cheap fares.  Ironically, I know of almost no one who gets their status solely from mileage running.  With a couple of exceptions, everyone has a mix of work and leisure flights that determines where they end up with status and only do mileage runs to get to that next rung of the ladder.

So I did a little analysis of how hard it will be starting in 2014 to earn your status.  Using GSA City Pairs and the set fares for FY13, I pick a range of short haul, mid-haul, and long haul flights that I think are typical of the military or government traveler.  They are listed below with the flight, contract airline, cost, miles earned, and the CPM.  I did assume everyone flying would get the 500 mile minimum although that is not always the case.

As you can see, the short haul flights generate a high CPM.  The trouble is they also generate very few miles and we need both to qualify.  In genreal though it is still not bad.  You can see the wide variation in CPM for flights.  My conclusion is that you are just going to have to start monitoring in two stats through the year, both cost and miles.  One good bit of news is that since the USG requires us all to fly U.S. carriers we don’t have to worry about flights on foreign carriers not counting towards the total.  Watch this on your personal travel though.  For personal travel, you also need to watch the miles earned, as most notably Delta, have reduced the amount of miles earned on several carriers.  United even stopped crediting miles earned on those cheap Turkish fares from earlier in the year.

I worked up a formula for qualifying (there’s the engineer in me again) to figure out ahead of time what your chances of making a given level are on UA or DL.

(% business travel x avg. CPM) + (% personal travel x avg. CPM) >= 10 CPM

Looks like most people will be OK if at least a third of their travel is at the higher CPM associated with business travel and the rest at a lower CPM for liesure travel.  Remember mileage runs are considered good at 4 CPM, so they can get you the miles, but too many of them will make you fall short of the monetary requirement.  I guess that was the point of this “enhancement” anyway.  Hard to believe the airlines went to all this trouble just for us few savvy travelers out there!