Cathay Pacific revamps customer loyalty scheme, with travellers required to shell out nearly 30 per

For economy-class tickets to destinations such as Sydney, London, Paris, San Francisco, Vancouver, Chicago, New York and Toronto, the mileage required will be cut by about 10 per cent.

In an email to members, Cathay said it was the first time it had adjusted its Asia Miles scheme since 2018. Members can collect points, or miles, through flying with the airline, by staying at certain hotels or through credit card spending.

Addressing the decision to substantially raise the miles requirement for certain classes, Cathay said it was the result of a “holistic review” of the programme based on existing market conditions and the competitiveness of its offerings.

Paul Smitton, Cathay’s customer lifestyle director, noted that the airline had said in January that it was committed to doubling the number of seats designated for members this year.

“Going forward, to ensure that we can keep our offering competitive, we’ll continue to review our flight awards periodically,” he said in the email.

Cathay said all miles requirements were based on ticket issue dates, which would not change for redemptions issued before October 1.

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The carrier is the latest among a number of airlines to tighten mileage redemption requirements.

United Airlines’ MileagePlus raised all European award rates in May, including flights from the United States to Europe, which now begin at 40,000 miles for economy and 80,000 for business class, a 33 per cent increase from the previous starting rates of 30,000 and 60,000, respectively.

Avios, a travel reward system used by British Airways, Iberia, Aer Lingus and others in the 14-airline Oneworld alliance, was revamped in December, allowing members to pay a fixed fee in addition to points to avoid high surcharges on award tickets. However, the number of points required jumped 12 to 60 per cent. Cathay is a Oneworld member.

Professor Law Cheung-kwok, a senior adviser at Chinese University’s Aviation Policy and Research Centre, said airlines’ moves were just a “fares” adjustment according to the market.

“The impact on customers depends on how many of them redeem tickets by mileage, which is hard to tell at the moment,” he said.

“But it is just normal behaviour from a business perspective to raise prices given flight capacity has not resumed and the large demand for flights at fairly expensive fares.”

Cathay was operating at about 50 per cent of pre-pandemic capacity in March, and aimed to reach 70 per cent by the end of this year and 100 per cent in 2024.

The carrier expects to return to profit in the first half of 2023 amid the rebound in demand, ending two consecutive years of losses.

Under Cathay’s revamp, a single business-class ticket between Hong Kong and London or Paris will require 29 per cent more mileage, at 84,000 points, compared with 65,000 at present. A one-way business-class ticket to London in July costs a minimum of HK$27,373 after tax and surcharges, at least HK$14,704 for premium economy and a minimum of HK$4,834 for an economy seat.

A single premium-economy ticket to London or Paris will require 25 per cent more miles, costing 50,000.

For single economy-class tickets, the mileage will be cut by 10 per cent to 27,000 points from 30,000 presently for London, Paris, San Francisco and Vancouver.

For long-haul routes such as San Francisco and Vancouver, a single business-class ticket will require 20 per cent more points, or 84,000 miles compared with 70,000 at present.

A single premium-economy ticket will cost 11 per cent more, at 50,000 points, to the two North American cities compared with 45,000 currently.

A single business-class ticket to Chicago, New York or Toronto will require 29 per cent more points, at 110,000, and 25 per cent for premium economy, at 75,000. A one-way economy-class ticket to New York costs HK$14,976, HK$15,916 on premium economy class and HK$55,596 on business-class in July.

A single first-class ticket to these destinations will set members back 160,000 points, or 28 per cent more than currently. But a single economy-class flight will cost 9.5 per cent fewer points at 38,000 from the current 42,000.

A single ticket to Sydney in premium economy class will require 26 per cent more points, at 58,000. A business-class single ticket will require 38,000 points, a 29 per cent increase, while a flight in first class will need 90,000 points, 28.5 per cent more than at present.

From January 1, 2020, Cathay allowed members’ mileage to be automatically extended by 18 months three years after the points were credited, as long as accounts were kept active.

Frequent flier Andrew Cheung King-kwan, 52, said he believed Cathay wanted to prompt members to redeem their points sooner as fares remained expensive.

“Allowing people to redeem tickets with lower mileage may cause the company to lose money,” said Cheung, a medical equipment trader.

Cheung in March spent 140,000 points redeeming two round-trip business-class tickets between Hong Kong and Vancouver. In October, that will rise to 168,000 points.

The extra 28,000 points would redeem a one-way business-class ticket to Beijing, Kuala Lumpur, Seoul or Shanghai under the revised scheme.

“I will still use my mileage for Cathay Pacific flights even if I need to use more because there is not much choice for flight redemptions, especially since I’m based in Hong Kong,” Cheung said.

He added he accumulated points by regular or essential spending via his credit cards, so he did not mind the tightened flight redemption requirement.

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