Qantas to Make Major Program Changes in September 2019

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On June 19th, 2019, Qantas announced a multitude of changes to its frequent flyer program. We are accustomed to seeing purely negative changes from airlines (i.e. extra fees, higher award prices). However, in this case, the changes announced from Qantas are a mix of positive and negative. The award-chart updates take effect on September 18, 2019, so there is plenty of time to book in advance if your travel plans fall on the losing side of the equation.

Qantas Frequent Flyer Program Overview

Qantas is the official airline of Australia and is part of the Oneworld Alliance. As far as reward tickets go, Qantas is known for having high carrier-imposed surcharges, steep award redemption rates, and limited award seats available in premium cabins. Overall, these characteristics don't bode well for reward flights. However, given that Qantas is the primary carrier servicing Australia, those living in or flying to Australia often have no choice but to travel with Qantas. Coupled with the relatively long distance that needs to be flown to reach Australia, award costs with Qantas can add up rather quickly.

In addition to earning Qantas points by flying, Qantas is a transfer partner of Citi ThankYou, American Express Membership Rewards, Capital One, and Marriott Bonvoy. Depending on your travel plans, there are still situations where Qantas can be a solid option for award bookings. These transfer partners make it easy to top up your account to the exact number of points needed for an award. In some cases, transferring to Qantas can be a good value—especially when a transfer bonus sweetens the deal.

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Qantas Changes Overview

Positive Changes

  • Reduced carrier surcharges by up to 50% on international bookings, resulting in potential savings of $200 per return trip.
  • More than one million additional award seats on Qantas and partner airlines.
  • Four additional airline partners: Air New Zealand, China Airlines, Bangkok Airways, and Air France/KLM.
  • Up to a 10% reduction in the miles needed for redeeming International Economy Classic Rewards.
  • Establishment of a new “Points Club” program to reward members who earn a significant amount of points through on-the-ground transactions.
  • Introduction of a Lifetime Platinum status to reward Qantas' most loyal flyers.

An interesting new development is the creation of a “Points Club” meant for members who earn a lot of points through non-flying-related transactions. The club will include two tiers with entry gained based on a member passing an annual points-earned criteria and will be launched in late 2019. Members will be able to earn flight and travel benefits such as lounge access, bonus status credits, and member-exclusive discounts on Qantas and partner airlines. Access to the initial tier is reached by earning 150,000 points. The more exclusive “Points Club Plus” tier will include more lucrative member benefits. The threshold to reach the higher tier has not yet been announced.

If you love Qantas and rack up a lot of points (and boy do we mean a lot), you can now look forward to achieving Lifetime Platinum status. This status level launches in September 2019 and can be reached by earning 75,000 status credits. For reference, you need 1,400 credits to earn Platinum status, and 1,200 credits to maintain it. That means you'd need 63 years of hitting the minimum number of credits to qualify for Platinum status before you'd be off the hook for life! With such a huge requirement, the lifetime status is an undertaking only for perennial status overachievers.

Negative Changes

  • Up to a 15% increase in the number of miles required for domestic and international premium awards.
  • Up to a 9% increase in the number of miles needed for upgrade awards.

Qantas claims that the increase in miles required is justified given that it is the first increase in 15 years, and the new price better reflects the upgraded experience. Although price increases are unfortunate, the changes won't take effect until September 18th, 2019, allowing flyers to lock in award tickets at lower-priced tiers.

Before and After Price Comparison

The good news is that the reduced taxes and fees are effective immediately, while the increases in points required don't begin until September 18th. For business and first-class flights booked after September 18th, the higher number of points required will generally cancel out (or in some cases far outweigh) any gains from reduced out-of-pocket costs. That said, the time window between now and the September deadline presents a unique opportunity where you can get the best of both worlds—paying the current award prices and benefiting from the reduced fees.

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Redeeming Qantas Points

Similar to other foreign carriers, Qantas has a distance-based award chart. Until September 17th, 2019, redemptions on Qantas will be governed by the award chart below.

Current Qantas Award Chart (through September 17, 2019)

New Qantas Award Chart (after September 18, 2019)

After September 18th, 2019, Qantas will use the following award chart:

Increases/Decreases in Awards:

Based on a comparison of the two award charts, we've assembled a quick-reference guide to increases and (decreases) in award costs. For the economy awards, Qantas has not published the updated award levels, so we've taken them at their word on a 10% reduction for international economy prices. Domestic-award prices may not end up getting a discount, so the values may be slightly different—particularly in zones 1-4.

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Best Awards

Short-haul flights on American Airlines within the Continental U.S.

Distance-based award charts tend to be most advantageous on short-haul flights. When the competition uses a zone-based chart, they're forced to settle on a single price for travel within an entire region. Since they don't want to make a transcontinental flight too cheap, prices for short flights are inflated. For example, an economy award flight from New York to Charlotte (529 miles), costs only 8,000 (presumably 7,200 after the change) Qantas points. In comparison, the same flight costs 10,000-12,500 miles with American or United.

Zone Arbitrage on International Flights

A similar zone-vs-distance arbitrage is possible when two cities in different regions are relatively close. For example, a flight from Boston to Amsterdam (3,457 miles) costs only 25,200 (~23,000 after the change) Qantas points. With United and American Airlines, an award flight is 30,000 miles from anywhere in the continental U.S. to anywhere in Europe. On the other side of the equation, a flight from Los Angeles to Moscow still costs 30,000 miles with American while Qantas would charge 37,600–41,900 depending on where you make your connection.

If you want to fly a route like Boston to Amsterdam in business class, make sure to book by September 17th, as it will only set you back 50,000 Qantas points. Comparatively, this route in business class will cost 57,500 points on American Airlines and 60,000–70,000 points on United. Since distance traveled is the key factor, booking a direct routing is critical. If you connect in Philidelphia instead of London, you'll end up in a higher zone. Great Circle Mapper is an ideal tool to find out how many miles you'll fly on a given route.

Similarly, an economy flight from Miami to Tel Aviv (6,603 miles) costs only 37,600 (~34,000 after the change) Qantas points vs. 40,000 with American Airlines and 42,500 with United. An economy flight from New York to Tel Aviv (5,692 miles) is an even cheaper 31,500 (~28,500 after the change) Qantas points. In business class, Qantas is the clear winner again with the ticket only costing 72,000 points vs. 85,000 points with United. Just make sure to book this business-class seat before the price increase goes into effect.

Qantas flights within Australia

Given that Qantas is the domestic carrier, it dominates flights in Australia. Again, distance-based awards can work to your advantage here. Remember, Qantas uses the total miles traveled for the entire itinerary. This is significantly different from fellow Oneworld member British Airways, whose distance-based chart makes a separate calculation for each flight on the itinerary. With Qantas, a connection doesn't necessarily cost you more miles, as long as the total mileage doesn't fall into a higher pricing zone.

Our Take

One thing to be thankful for is that these changes aren't overwhelmingly negative. The reduction in carrier surcharges is a positive development. When coupled with using Qantas points on zone-based award sweet spots, a good redemption is possible. The Points Club provides an innovative way to pick up some extra flying perks with Qantas and I'm interested to see how it will develop. The addition of partner airlines is a good move and it will be interesting to see how many award seats are actually available for booking. Qantas' promise of adding an additional one million award seats includes these partners, so hopefully, redemption opportunities will improve. I am cautiously optimistic that these claims behind these changes actually result in some positive benefits to fliers.

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Qantas to Make Major Program Changes in September 2019
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Comments

  • Lowering fuel surcharges is always welcome.

  • These changes are negative for anyone who wants to fly business class from LAX/SFO to MEL/SYD . How many individuals want to sit in coach for 16 hours?

  • Steven William Van Meter says:

    Nothing worse than steep award redemption rates. I do see some very positive aspects here though.

  • For me the interesting aspect of the changes is the four additional airline partners: Air New Zealand, China Airlines, Bangkok Airways, and Air France/KLM since they are outside of oneworld and have the potential for good reciprocal opportunities.

  • It was big news across Australia weeks ago.

  • This makes using my small balance of QF miles even harder…sigh…

  • Overall not a bad change, I expected it to be much worse.

  • Looks like before and after the change, fuel surcharges are still higher than other non-qantas redemption alternatives .

  • I hope this ends up being a good thing.

  • Bogus fuel charge reduction is welcome though the increase in mileage is a big disappointment.

  • Quite disappointing. Qantas business and first class awards were already very high. It’s getting easier to earn Qantas points in Australia but really difficult to redeem for any worthwhile long haul flight.

  • Be sure to redeem before devaluation at Sept if you can to lock in the lower rates.

  • at least more partners got added

  • The Arts Traveler says:

    The fuel surcharge reduction puts this back in play. I can put down under back on the list.

  • Overall, considering what have done the other airlines these changes could be quite positive especially for people travelling in economy when redeeming flights.

  • I definitely appreciate the reduction in fuel surcharges. There are lots of ways to earn points for free but the fuel surcharges are real money. Thanks for the update on this program.

  • Predominant carrier of Australia is correct: they hold s monopoly on many segments and their prices on those specific routes reflect that. They offer GREAT service on every route (I’ve flown on) but they most certainly price-gouge.

  • I’m fairly new to Qantas and really only started to look their way because I have quite a few TYPs that I need to get rid of as I’ve moved my ecosystem over to Amex. Nice to see that the changes aren’t terrible. One thing that I don’t understand (again I’m kinda new to this) is that I can see all of AAs MileSaver seated when booking via BA Avios but not all availability shows up for searching via Qantas. Just wondering why British can see it but Qantas don’t. Any idea?

  • The changes aren’t as bad as I expected. I’m just hoping when American decides to pull the trigger on dynamic pricing that the pain isn’t too bad. Here’s to hoping…

  • Thank you for this very comprehensive review of the Qantas FF changes. I’ve seldom if ever, had any problems redeeming points for domestic travel on Qantas, so the 1 million extra seats is a bit of a furphy in my opinion. The higher number of points required for the premium cabins is disappointing, to say the least. I’m a Qantas Club member and the lounges in the major domestic airports are already too crowded in my view. Giving free access to people with more than 150k points will only add to the congestion and devalue my Qantas Club membership. As you say, there are some positives and some negatives to the Qantas changes.

  • Look’s like lots of changes. Although there are ups and downs, there are still sweet spots within these changes. The carrier surcharges reduction is quite solid for fee saving.

  • Andrew Choi says:

    reduction in fuel surcharges is a good indicator, as fuel surcharges give big boost your financing. Appreciate the update for this program.

  • Don’t love this but not as bad as some are making out!

  • This is so exciting to me because Qantas just launched a Chicago to Brisbane route and I will definitely be on that flight in the near future, using my AA miles!

  • With my use Id say slightly positive overall. And with due notice.

  • More negatives than positives here unfortunately.

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