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Planning your summer holidays got a little easier since British Airways announced in a press release that you can pay for some or part of your vacation with Avios. However, like many things in the points and miles world — and life in general — just because you can do something does not necessarily make it a good idea. So, should you use your Avios to book British Airways Holidays? Let's dig in.
Redeeming Avios For British Airways Holidays Bookings
With British Airways, there always tends to be a sting in the tail, whether it is outrageous surcharges or a lack of availability. So, while paying for your holiday with Avios sounds good, how much value do you actually get, and is it worthwhile?
The only way to figure that out is to look at a few redemption options and determine how many pence (cents) per Avios you are getting.
Long-haul: One week in Cancun, Mexico
The first example is a one-week vacation in Cancun. The trip departs London on September 18 and returns on September 25, 2023. The total price for two people, including flights and accommodation, is £1,922 ($2,305).
Going through the booking process, you have the option to reduce your payment amount for a set number of Avios. You have nine options to choose from.
On the lower end, you can reduce your price by £20 (~$24) for 2,000 Avios, while at the higher end, you can redeem 146,279 Avios for a £628 (~$753) reduction in your holiday price.
The pricing shows a very interesting trend. British Airways is practicing that not well-known economic principle of “diseconomies of scale” whereby the more you buy of something, the more expensive per unit it gets, not cheaper!
At the low end, you are exchanging 2,000 Avios for £20 (~$24) at a rate of 1 pence (1.2 cents) per Avios. However, at the higher end, exchanging 146,279 Avios for a £628 (~$753) reduction is a worse deal, only giving you 0.43 pence (0.52 cents) per Avios.
Running the numbers with the other options, it seems the exchange rates rapidly decline in value. Clearly, if you want to have what looks like a decent return, you should only exchange a small amount of Avios for a tiny reduction in cost.
| Reduction in GBP | Avios Required | Pence Per Avios | US cents Per Avios |
|---|---|---|---|
| £20 | 2,000 | 1.0 | 1.20 |
| £41 | 5,525 | 0.74 | 0.89 |
| £71 | 11,000 | 0.65 | 0.78 |
| £111 | 19,300 | 0.58 | 0.69 |
| £150 | 28,175 | 0.53 | 0.64 |
| £233 | 49,025 | 0.48 | 0.57 |
| £334 | 77,075 | 0.43 | 0.52 |
| £506 | 117,950 | 0.43 | 0.52 |
| £628 | 146,279 | 0.43 | 0.52 |
Short-haul: One week by the beach in Malaga, Spain
Looking at some European winter sunshine, departing from London for one week in Malaga, Spain for 2 adults will set you back £544 (~$652). This holiday is for a departure on November 20 and a return on November 27, 2023.
Again, going through the booking process, you can redeem Avios for a reduction in the holiday price. This time around, at the lower end, you can reduce your price by £22 (~$26.5) for 1,950 Avios. However, on the higher end, you can redeem 123,700 Avios for a £543 (~$651) reduction in your holiday price.
Yet again, crunching the numbers reveals a value per Avios that rapidly declines. At the low end, exchanging 1,950 Avios for £22 (~$26.5) works at a rate of 1.13 pence (1.36 cents) per Avios. However, this rate worsens quickly, and redeeming 123,700 Avios for a £543 (~$651) reduction gives you a less-than-stellar value of 0.44 pence (0.53 cents) per Avios.
| Reduction in GBP | Avios Required | Pence Per Avios | US cents Per Avios |
|---|---|---|---|
| £22 | 1,950 | 1.13 | 1.36 |
| £39 | 4,425 | 0.88 | 1.06 |
| £56 | 7,375 | 0.76 | 0.91 |
| £120 | 21,775 | 0.55 | 0.66 |
| £148 | 29,325 | 0.50 | 0.61 |
| £195 | 43,375 | 0.45 | 0.54 |
| £261 | 59,450 | 0.44 | 0.53 |
| £348 | 79,275 | 0.44 | 0.53 |
| £543 | 123,700 | 0.44 | 0.53 |
Why British Airways punishes its members for redeeming more Avios makes no sense. Surely British Airways would want to reward its members for using up their Avios, but sadly this is not the case. This, in turn, means it only really makes sense to redeem a small number of Avios for a minimal reduction in the cost of your holiday.
How Much Are Avios Worth?
Avios are unique in the points and miles world for two reasons. They are the same currency used by 4 different airlines, Aer Lingus, British Airways, Iberia, and Qatar Airways. Because of this, you can transfer them between airlines at no cost with a 1:1 exchange rate. As a result, you have many options to arbitrage your Avios between programs to get the absolute maximum value out of every single one.
For instance, AwardWallet members have been able to redeem Avios through their British Airways Executive Club accounts for an average value of 3.15¢. Even short-haul economy flights yield 2.07¢ per Avios. Clearly, this is better than redeeming your Avios towards a British Airways Holidays booking.
However, you could do better if you want maximum value. Transferring your Avios over to Iberia Plus lets you leverage them for even more value. From recent data, AwardWallet members have leveraged their Iberia Plus Avios for a whopping 3.84¢.
Your opportunities don’t end there if you are looking to fly a route served by Qatar Airways or one served by Aer Lingus. Transferring your Avios to one of those programs could yield even better value from your Avios.
Learn more: How to Use Avios for Maximum Value
Is it Worth Your While Redeeming Avios For British Airways Holidays?
The bottom line is that more options to use your Avios is good news. But, sadly the returns for using them for British Airways Holidays are a little underwhelming.
Looking at the value per Avios, it is unwise to use a ton of Avios to get a massive discount on your holiday deal. You’re better off using your Avios for much better value activities like award flights.
However, if you have Avios that are about to expire, then using Avios to reduce the cost of your British Airways Holidays booking by £20 (~$24) or £30 ($36) is an excellent option. Not only will you redeem Avios around the higher end of holiday redemption values, but you will also reset the expiration clock on your entire Avios balance. That gives your Avios another 36 months of validity.
Redeeming Avios for a fixed value of between 1.13 pence (1.36 cents) per Avios and 0.43 pence (0.52 cents) per Avios is not the greatest option out there. However, if it suits you for any reason, it is always a useful tool to have on hand. However, I would not make it one of my go-to options for redeeming British Airways Avios.
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Important thing about getting hotels from BA. BA hotel rates can be some of the lowest available. Especially for hotels that are not chains. Be a comparative shopper and cross check the BA pricing. The small Avios discount could result in an even better deal for small London hotels.