How Does the New Delta Program Affect the Military/ Gov’t Flyer?

By now you have all read many versions of the announced Delta Skymiles Program changes from our fellow bloggers or seen it on the network news.  Lots of opinions, but how does this affect you given your particular flying patterns?  Last year I did an analysis of Delta’s and United’s change to requiring Mileage Qualifying Dollars (MQD) as well as EQM.  The result was that for official travel using DTS, you didn’t have much to worry about given the high rates that the GSA contracts for.  However, if you were flying a significant amount of leisure travel, the lowered rates might be a problem for you to reach the top elite levels. 

So what if we take a look at how many RDM you earn with Delta starting in 2015?  Remember that they are changing to a model that gives the non-elite flyer 5 miles/ $ and the elite flyers an increased amount up to 11 miles/ $ for their highest level – Diamond. The elite bonus is roughly the same as other airlines. For example, I get a 100% bonus on my RDMs from United for being a 1K and on Alaska for being a Gold. Here is a chart of common GSA City Pairs, although the majority of these routes are not contracted to Delta, but they illustrate typical fares.  Note particularly the difference between the short flights and long flights.

Delta 2015 Changes
City Pair	Cost ($)	2014 Miles	2015 Miles	2015 Elite
DCA-FAY	199	500	995	2189
COS-DFW	165	592	825	1815
PHL-ORD	209	678	1045	2299
ATL-TPA	174	500	870	1914
SAN-DCA	244	2276	1220	2684
LAX-IAD	308	2288	1540	3388
EWR-SEA	279	2402	1395	3069
MCI-SFO	229	1499	1145	2519
SEA-HNL	339	2677	1695	3729
PDX-ANC	439	1542	2195	4829
MIA-PTY	497	1152	2485	5467
IAD-KWI	1516	6575	7580	16676
HNL-MNL	557	5302	2785	6127
ORD-FRA	792	4343	3960	8712
TYO-SEA	642	4797	3210	7062
TOTALS	6589	37123	32945	72479

So as you can see, if you fly short flights, you will be getting more miles than you used to and less for long flights.  Remember that you will still earn the same for EQM and also must earn MQD to match the EQM earned to reach the desired elite level.  Confusing, I know!  Here is my analysis of Delta’s new scheme:

– If you fly primarily short haul flights: You are going to earn plenty of MQD and more RDM.  Your problem will be accumulating enough EQM to get any meaningful elite level.

– If you fly primarily long haul domestic: This looks like the sweet spot.  You pay enough that you are paying significantly more than 10CPM which meets the standard for all elite spending, while earning enough EQM to reasonably get to the higher elite levels where the benefits are good and actually get more RDM than you did previously.

– If you primarily fly long haul international: You are the type of flyer who used to easily make top elite and have plenty of miles.  Now you get one of two.  You will still pay enough to make all elite level spending requirements, but just barely.  Meaning that if you combine significant leisure spending with official travel, you may end up short of MQD.  You’ll still rack up a lot of EQM and make status, but you may find yourself poor on RDM to spend.  You can see that the international routes can give you up to 50% less than you previously earned.

If you are saying to yourself, “so what, I don’t fly on Delta”, think again.  Airlines look at each others experiments and see if the public tolerates that, then adopt it themselves.  I remember several years ago when Spirit Airlines decided to start charging for baggage and everyone thought they were crazy.  Guess what?  The public paid the fees and soon everyone else said “me too”.  Now airlines are getting billions from baggage fees from their customers.  One airline or another will try to make a price increase and then see if the others join.  If they don’t, they quickly retreat. 

This latest scheme will similarly be watched by the other airlines.  Here are my predictions of what they will do:

United – They are already having meetings to decide when they can copy Delta, just as they did with implementing MQD.

American – They are totally absorbed with integrating the merger.  They will not think of significant changes to their FF program until they figure all that out.  Probably at least a couple of years away.  They’ll market themselves as the alternate airline to flyers fed up with Delta or United’s changes.

Alaska – Alaska is currently in an undeclared war with Delta.  They won’t make any changes to their program and try to attract flyers that hate the new rules and want an “old school” frequent flyer program.  One advantage that they have is that since Delta is a partner who earns EQM/ RDM on Alaska, people who are in a Delta dominated area can still fly Delta, but earn status on Alaska.  Since AS elite can actually get upgrades on DL, this is a pretty good move and I have seen quite a few readers on Boarding Area blogs say that this is what they are going to do.

Time will tell where all FF programs go, but one thing for sure is that the Golden Age of frequent flyer programs is behind us.  Credit cards will assume more dominance than they already have in FF programs and it will start getting tough if you don’t integrate the various CC benefits into your mileage earning strategy.  The other shoe for Delta’s program has yet to drop: they are revising the number of miles required for a free flight.  See my friend Rene’s take on predictions for the future Delta program.  Notice how none of them are improvements?  Get used to that…