Frequent flyers hit as airline surcharges fly high despite slump in fuel prices

[MEL_Traveller]

You think? QFF would simply raise the redemption levels...

well - I dunno about this.

If fuel continues to fall, there's going to come a point where pricing can no longer be justified as an award seat + fuel.

It's going to become an award seat + co-pay + fuel. That is, there would be no true award seats.

That fundamentally changes the proposition of the program. I wold then be looking to explore what action could be taken to rectify that.

 

[serfty]

...

That fundamentally changes the proposition of the program.

Which has basically happened already. With an international points redemption in Economy from SYD-LAX, along with the 48K points cost the +++ comes to $466 of which $340 is YQ.

There is no way known that QFF are going to allow that to be redeemed for 48K + $136!

 

[MEL_Traveller]

Which has basically happened already. With an international points redemption in Economy from SYD-LAX, along with the 48K points cost the +++ comes to $466 of which $340 is YQ.

There is no way known that QFF are going to allow that to be redeemed for 48K + $136!

but they might have to.

depending on where fuel goes, and unfortunately I don't have the historical data, it might be interesting to see what the ACCC makes of this. I would find it hard to accept that a company could advertise an award seat without it actually being just that.

and points plus pay is a separate concept.

 

[dajop]

There is no way known that QFF are going to allow that to be redeemed for 48K + $136!

From memory, QF do allow some SYD-LAX journeys for admittedly a few more points than that, but about that in surcharges .... just have to start the journey in AKL.

 

[serfty]

... I would find it hard to accept that a company could advertise an award seat without it actually being just that. ...

Oh, they can advertise as such - but QFF control how many points might be redeemed on a route.

You think? QFF would simply raise the redemption levels...

With three months notice, that 48K may very well become 72K ... and there would be little the ACC could do about it, even if they were interested.

AFF and similar types aside, Qantas basically have a captive market.

 

[MEL_Traveller]

Oh, they can advertise as such - but QFF control how many points might be redeemed on a route.With three months notice, that 48K may very well become 72K ... and there would be little the ACC could do about it, even if they were interested.

AFF and similar types aside, Qantas basically have a captive market.

I agree they could increase the points levels required - but would they? If they suddenly came out to announce awards had doubled, would people still collect via credit card? Via safeway? Or QF cash? Would they still choose to fly Qantas if they can get a cheaper fare elsewhere?

 

[trippin_the_rift]

I agree they could increase the points levels required - but would they? If they suddenly came out to announce awards had doubled, would people still collect via credit card? Via safeway? Or QF cash? Would they still choose to fly Qantas if they can get a cheaper fare elsewhere?

Since QFF last devalued it they've gone on to become more profitable than ever.
Also outside of 'AFF and similar types' people have a real association with the Qantas brand. They almost feel like it's a national team we all have part ownership of. I was talking to my uber driver last week who was annoyed with Qantas coz he had to pay $2000 in tax to for him/wife return to Europe. I suggested he could earn more points and have lower taxes with Velocity but he didn't care. Similarly - my own mother wants me to book her and a friend on a domestic flight biz but "wont have a bar of Virgin".

Old habits die hard. I don't think a devaluation will affect QFF too much to be honest.

 

[MarkD]

I agree they could increase the points levels required - but would they?

I recall back when they went from km to miles, essentially did that exact same thing. Had to fly 60% further for each point. Ie one mile instead of a km. They got away with it then and people forgot, cant see why they wont again

 

[serfty]

I recall back when they went from km to miles, essentially did that exact same thing. Had to fly 60% further for each point. Ie one mile instead of a km. They got away with it then and people forgot, cant see why they wont again

Of course, that came in with status bonus so for (then) top level Gold, it was nearly the same earn (1.5~1.6).

 

[MarkD]

As a bronze at the time i was far worse off though

 

[serfty]

As a bronze at the time i was far worse off though 

Actually, I am thinking the thousand point minimum for all was brought in at the same time - I went from .7 earn on regular B class MEL-SYD 707km of 495 to 1k. (Needed to book Y to get the full amount.)

I'll have to check my statements to confirm that.

Anyhoo, both Qantas and Ansett did the same thing and fares were still relatively high.

One and a half decades later, things have changed ...

 

[eastwest101]

As others have mentioned - the Fuel Surcharges have nothing to do whatsoever with the price of oil or the price of jet fuel.

They actually started off as a "lets try to avoid paying travel agents comissions" fee, and then later became a "we don't have the balls to devalue our Frequent Flyer Points by increasing the points required for a flight redemption" fee or a "discourage people from using FF points to redeem a seat on our planes" fee. Nothing to do with fuel at all.

Its pretty clear what the motivations are - often airlines don't want the bad PR and public reaction to devaluing FF points - for some airlines - selling FF points to banks and credit cards is a sizeable revenue stream, the last thing they want is customers actually redeeming those points and taking seats on their aeroplanes - they want them spending points on toasters!

As others have pointed out - the actual real airfares we see (comprising of the base fare plus the fuel fee and any other real minor goovernment taxes and airport fees) are a product of competition, demand, supply and capacity and what the market will bear. I don't imagine that the ACCC could do anything about the legality of fuel surcharges, sure, the description of them as fuel surcharges may be a little misleading/deceptive, but there is no law against surcharges, provided that they are not hidden and are disclosed, it might be a tough one to prove in court.

 

[MEL_Traveller]

I don't imagine that the ACCC could do anything about the legality of fuel surcharges, sure, the description of them as fuel surcharges may be a little misleading/deceptive, but there is no law against surcharges, provided that they are not hidden and are disclosed, it might be a tough one to prove in court.

I don't think fuel surcharges are illegal - but the whole description of the QFFF might get to a point where it is deceptive and misleading. you can longer redeem a listed award plus a linked fuel surcharge, you are now redeeming an award with an arbitrary co-pay.

 

[whatmeworry]

That is why Flybuy points were once good. You could once redeem a QF award and only pay tax.

 

[jsoprano]

Not sure if it fits here, but the QF/EK fuel surcharges are just obscene. Was just stung with 404 EUR for a QFF Classic Award in J flying FRA-DXB-BKK on EK. My preference would have been to go to HKG instead on CX, but no availability on the dates I needed. That one would have been a reasonable 148 EUR.

 

[eastwest101]

I don't think fuel surcharges are illegal - but the whole description of the QFFF might get to a point where it is deceptive and misleading. you can longer redeem a listed award plus a linked fuel surcharge, you are now redeeming an award with an arbitrary co-pay.

I agree - that is probably the approach any class action could possibly take, as the entire QFF scheme and many other schemes are advertised as "earn points to redeem for seats on flights" not "earn frequent flyer points to pay a surcharge to use the points".

I think the key crossover point for succesful litigation would be in the instance that the Fuel Surcharge amount for a redemption exceeds the cash cost of buying a fare (i.e. the base fare goes to 0$ or indeed base fare becomes a negative -$xx_.xx ), as you say - that may lead the court to consider the surcharge as arbitrary. Maybe all someone has to do is prove that the fuel surcharges are "arbitrary" and that could open up an avenue of attack. Would obviously require time and cost a bit to see through a legal challenge.

 

[MEL_Traveller]

I agree - that is probably the approach any class action could possibly take, as the entire QFF scheme and many other schemes are advertised as "earn points to redeem for seats on flights" not "earn frequent flyer points to pay a surcharge to use the points".

I think the key crossover point for succesful litigation would be in the instance that the Fuel Surcharge amount for a redemption exceeds the cash cost of buying a fare (i.e. the base fare goes to 0$ or indeed base fare becomes a negative -$xx_.xx ), as you say - that may lead the court to consider the surcharge as arbitrary. Maybe all someone has to do is prove that the fuel surcharges are "arbitrary" and that could open up an avenue of attack. Would obviously require time and cost a bit to see through a legal challenge.

i wouldn't even consider going down a complex route like that.

you'd just lodge a complaint with the ACCC and let them investigate. no need for class actions, no need for any individuals to hire lawyers.

the basis of the complaint is a simple one. the program is to give away award seats, not co-pay seats (save where the co-pay might legitimately be linked to something outside the airline's control... such as fuel).

 

[serfty]

That is why Flybuy points were once good. You could once redeem a QF award and only pay tax.

That's why QFF awards were once good - you could once redeem a QFF award and pay no tax. (I remember getting annoyed when they started to charge the $3.40 SYD noise levy.)