Fly-for-free offers could be a mirage

Demand may exceed available seats

read promotions' tiny print

Big carriers cut back flights

Your Money

April 04, 2004|By Lorene Yue | Lorene Yue,YOUR MONEY STAFF WRITER

You could be left at the gate if you think new promotions by the major airlines guarantee you a free ride just for buying a couple of round-trip tickets.

The promotions are part of a battle to keep low-cost carriers such as JetBlue Airways and Southwest Airlines from snatching away even more business.

American Airlines announced in early January that you could earn a free ticket if you take two round trips to select markets by April 15. On United Airlines, you will have to fly three qualifying trips by June 15 to get a free economy-class ticket.

Sounds easy, but read the fine print. Cashing in could be harder than you think.

"It has to be remembered that `free' is capacity-controlled," said Tim Winship, publisher of, a newsletter tracking frequent-flier programs. "They are only going to give out free seats when the seats would have otherwise been empty. The result is that there is going to be further demand for these free seats."

The problem lies in the simple economics of supply and demand. Major carriers have been shaving the number of their flights to keep operating expenses down ever since the airline industry got financially walloped by a pullback in passenger traffic after the Sept. 11, 2001, terrorist attacks.

Musical chairs

Fewer flights make for a tough game of musical chairs when thousands of travelers are vying for a few free spots.

"It has become that much more difficult for consumers in the past couple of years to get that reward," Winship said. "I would expect that the disconnect between demand for award seats and award seats is going to grow."

And forget about trying to snag a free first-class ticket or even an upgrade to the front of the plane. With the limited number of those available on planes, it is tough to get everyone who wants one into the coveted seats.

"In some cases, it's an empty promise," Winship said.

Frequent fliers looking to break into the perk-filled elite clubs run by the airlines could have a tougher time as airlines tighten admission standards. Some carriers are using a point-based system based on ticket prices. The more bucks you pay, instead of the number of miles you've traveled, the closer you get to elite status.

"We are trying to reward our best customers," said Carlo Bertolini, a spokesman for American Airlines, which operates the largest frequent-flier program in terms of members. "It might benefit someone who buys full-fare or business-class tickets."

Many airlines that are still using a mileage system have raised the amount it takes to get the top free rewards. Alaska Airlines requires 80,000 miles to earn a free first-class unrestricted ticket. Last year, it took 60,000 miles.

Other airlines have made changes to their frequent-flier programs. America West split its free tickets into short-haul and long-haul categories. Flights of less than 750 miles require 15,000 award miles, while longer flights require 20,000 award miles.

But there's another perk in the works that won't cost frequent-flier miles. The federal government is considering a program that would get pre-screened passengers to the gate faster. The registered traveler program could go into a 90-day testing period at select airports this summer. All you would have to do is pay a fee and get a thorough once-over by the federal government. If you get the stamp of approval, you won't have to worry about being randomly selected for a second screening once you get through airport security.

Partner companies

Of course, you can also collect and spend miles through the airlines' various partner companies, including restaurants and car rental agencies.

"There are more and more opportunities for earning and redeeming miles," Bertolini said. "You don't have to use your miles on a flight; you can use them for a hotel or even ordering flowers."

However, you could end up paying for those miles because of the Taxpayer Relief Act of 1997. That act requires frequent-flier program partners to pay a 7.5 percent federal tax when buying miles from the airline.

In some cases, partner companies pass that cost through to you via higher service fees or by charging up to 2 cents for each frequent-flier mile you earn.

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