Aeroplan 101 - A Guide to Aeroplan
As of November 8th, Aeroplan is changing, as Air Canada finalizes the reintegration of Aeroplan into their folds after 18 years apart. Originally billed as a complete overhaul, the brand remains the same, although how you interact with Aeroplan may be changing in the near future. Think of this article as an Aeroplan 101 to help you understand the changes that Air Canada’s implementing and where you can find more information. As a Canadian, Aeroplan is the most known travel rewards program, and therefore it’s important to understand how earning and redeeming points is going to work.
Who is Aeroplan?
Aeroplan, the loyalty program of Air Canada, was separated from Air Canada in 2002 (and IPO’ed in 2005) to raise cash for the airline, which was struggling at the time. Since 2002, Airlines have realised the wealth of data that their loyalty program owns, along with the vast earning potential those points, or miles, have. With that being said, in 2017 Air Canada announced that they would be splitting up from Aeroplan in 2020 in order to build their own loyalty program. After the announcement (and likely prior too), Air Canada recognized that Aeroplan’s brand name, and their 5 million customers was too strong in the market and made the agreement to purchase Aeroplan in November 2018 (completed in January 2019). After purchasing Aeroplan, Air Canada committed to updating the program but keeping the name around.
What do you earn with Aeroplan?
The branding team gets two thumbs up for the new crisp Aeroplan brand
As of November 2020, Aeroplan will be converting all Aeroplan Miles to Aeroplan Points at a one-to-one ratio. All Aeroplan miles will be converted, which means that Aeroplan miles will not be lost during the transition to Aeroplan points.
How do you earn Aeroplan Miles?
Aeroplan points will be earned differently than in the past. In the past, on Air Canada, Aeroplan points were earned based on what fare class was booked, the miles flown and the destination. Now, even if you book a basic fare, you will be earning Aeroplan points on that fare that you pay for the ticket. For the average Air Canada traveller, one who doesn’t have status will earn Aeroplan points as follows. a basic fare will earn 2x the Aeroplan points on the base fare for a flyer with no Aeroplan status and 3x the Aeroplan points on the base fare for non-basic fare flights. If you have status, you will earn an additional set of points up to 4x your base fare. Although this was announced by Air Canada, earning rates won’t change until later in 2021.
New Aeroplan Earning Example:
For example, a pretty typical business flight is Toronto to Ottawa booked a few weeks in advance. The total purchase price for this ticket is 341.40, and it’s an economy standard ticket.
In the past, as a non-elite Air Canada Member, you would earn 25% of the distance for each segment (in miles). The distance between Ottawa and Toronto is 226 miles, therefore you would only earn 57 miles. There used to be a minimum of 250 miles, but with the addition of further segmentation for fare classes, the new minimum is 25% of 250 miles, or 63 miles, what you would earn in the past for this flight.
This Aeroplan Earning chart will be used until sometime in 2021
With the new system, the Aeroplan member-only earns points on the fare, not the distance. Specifically, the member would only earn points on the Air Transportation Charges, which come out to $271. This is an economy standard ticket and therefore you would earn 3x base fare in points, for a total of 813 Aeroplan points. More expensive, short haul tickets will earn more miles going forward then they have in the past. In this case, this ticket will earn 13x more points then the Aeroplan member earned in the past.
Example Two - Aeroplan Earning on a Round Trip Economy Ticket to Hong Kong
On the other hand, if you’re booking a leisure trip to visit family and friends in Hong Kong, the earnings have significantly decreased. Right now, the price for a summer round-trip ticket to Hong Kong is $1118, significantly cheaper than it would be pre-COVID-19.
The total fare is $1008
In the past, as a non-elite Air Canada Member, you would earn 25% of the distance for each segment (in miles). The distance between Toronto and Hong Kong is 7810 miles, which mean your round trip ticket would have earned 7810 Aeroplan Miles (7810 * 50% earning * 2 segments).
With the new system, the Aeroplan member only earns points on the fare, not the distance. Specifically, the member would only earn points on the Air Transportation Charges, which come out to $1008. This is an economy standard ticket and therefore you would earn 3x base fare in points, for a total of 3024 points. Long haul flights booked well in advance for leisure trips will earn less points than in the past. In this case, the earning was over 50% less with the new system.
Earning with Credit Cards
Earning with the CIBC issued Aeroplan Visa, the TD Issued Aeroplan Visa and the American Express issued Aeroplan cards is staying roughly the same. The cards with the cheapest annual fee will offer 2 points per 3$ spent on most purchases, the middle level cards will earn 1 point per dollar spent, and the top level cards will earn 5 points for every 4 dollars spent with many bonus categories. If you’re looking for an in depth unbiased review of the credit cards offered in Canada, check out Ricky’s post on the Prince of Travel website.
Other Earning Opportunities
Air Canada will keep the Aeroplan E-Store for earning miles through day to day shopping. In addition, Air Canada promised new retail partners. I’m curious to see if a large gas chain will join forces with Aeroplan.
Redeeming Aeroplan Points
Aeroplan miles are theoretically going to be easier to redeem as every seat on an Air Canada plane is now bookable with points. That’s great news, but in order to facilitate a revenue based model, Air Canada is going to a dynamic award chart. In addition to increasing availability, Air Canada is removing those pesky carrier surcharges, a positive addition to the program. Overall, for the average user, Aeroplan should be theoretically easier to use for flights when you want to fly, with less cash cost out of pocket.
Aeroplan Award Chart
In the past, Aeroplan had divided the world into several different zones, aligning with the continents, and then further subdivided the continents. Aeroplan will now divide the world into only 4 distinct zones, North America, Atlantic, Pacific and South America. South America and North America are relatively obvious (North America includes Central America), but Aeroplan includes Europe, Africa, Central Asia, the Middle East and the Indian Sub-Continent in Atlantic, whereas they included Australia, South East Asia, Japan, China and the rest of the Far East in the Pacific Region.
The new award zones for Aeroplan are simplified
Within each of these zones, there are different distance bands. These distance bands will act in a similar way to the award zones in the old Aeroplan charts. To calculate the cost of the trip using the new Aeroplan, you will need to find out the distance of your travel. The distance is calculated by adding up the distance between all your flight segments. The best method to calculate distance and cost for Aeroplan awards is using www.gcmap.com to map out your segments, then comparing it to the Aeroplan award zones.
The information laid out in each of the charts for Aeroplan bookings on Air Canada is meant to serve as a guide for redemptions, meaning that 95% of all awards will fall within that range. That being said Air Canada has stated that close in bookings or holiday bookings may be outside this range.
Within North America - Aeroplan Chart
Aeroplan has divided up North America into the following distance ranges, subdivided by flights operated by Air Canada and flights operated by other airlines:
Within North America Award Chart
Between North America and Atlantic zone - Aeroplan Chart
Aeroplan has divided up North America flights to the Atlantic Region into the following distance ranges, subdivided by flights operated by Air Canada and flights operated by other airlines:
Aeroplan NorthAmerica and Atlantic Award Chart
Between North America and Pacific zone - Aeroplan Chart
Aeroplan has divided up North America flights to the Pacific Zone into the following distance ranges, subdivided by flights operated by Air Canada and flights operated by other airlines:
Aeroplan NorthAmerica and Pacific Award Chart
Between North America and South America zone - Aeroplan Chart
Aeroplan has divided up North America flights to the Pacific Zone into the following distance ranges, subdivided by flights operated by Air Canada and flights operated by other airlines:
Aeroplan North America and South America Award Chart
Within Atlantic - Aeroplan Chart
Aeroplan has divided up the Atlantic zone into the following distance ranges, subdivided by flights operated by other airlines:
Within Atlantic Aeroplan Chart
Within Pacific - Aeroplan Chart
Aeroplan has divided up the Pacific zone into the following distance ranges, subdivided by flights operated by other airlines:
Within Pacific Aeroplan Award Chart
Within South America - Aeroplan Chart
Aeroplan has the South America zone in one range, subdivided by flights operated by other airlines:
Within South America Aeroplan Award Chart
The new Aeroplan awart chart will be similar to the old chart, but here are two different examples of how redeeming flights with the new Aeroplan will work.
Within North America - Aeroplan Example
As my parents spend time in Prince Edward Island during the summer, I’m going to use Toronto to Charlottetown as an example for the new Aeroplan points pricing. At 827 miles between Toronto and Charlottetown, the flight to Charlottetown prices in the second North American distance band. According to the new Aeroplan award chart, Air Canada will be pricing this route between 10,000 - 15,000 Aeroplan points in Economy, 15,000 - 25,000 points in Premium Economy, and 20,000 - 35,000 points in Business Class, compared to the current cost of 15K, 20K, and 25K. In addition, the usual carrier surcharge of $42 will no longer be charged and the total cost will be reduced from $83.76 to $41.76.
The current taxes come out to 83.76
One of the reasons I got into Miles&Points was because of how expensive it was to fly to Charlottetown using cash in the summer. Although the published rate has flights cheaper then they used to be, I suspect that most summer flights will be at least 15K, with many weekends topping 40K Aeroplan points and beyond for a one way economy flight, the equivalent to a $400 flight.
North America to Atlantic - Aeroplan Example
Many Canadians are a part of the Indian diaspora and booking Aeroplan flights to India is a popular use of miles. The direct flight from Toronto to Delhi is 7,246 miles and is operated by both Air Canada and Air India which are both bookable by Aeroplan. According to the new Aeroplan award chart, Air Canada will be pricing this route between 45,000 - 85,000 Aeroplan points in Economy, 60,000 - 140,000 points in Premium Economy, and 75,000 - 175,000 points in Business Class, compared to the current cost of 50K, 65K, and 75K. In addition, the usual carrier surcharge on Air Canada of $655 will no longer be charged and the total cost will be reduced from $709.16 to $54.16.
That being said, like the previous case, I suspect that there will be few seats at the 45,000 / 75,000 range, and after the first few are gone, many will price out at the 75,000 / 150,000 range. If that is the case, the partner booking fees would apply. Although direct flights are nice, Air India leaves a lot to be desired (a story for another time), most other options actually price into the next North America to Atlantic band. Therefore, to connect to India, you’re looking at 60K, 85K, and 130K in Economy, Business and First Class if connecting through Europe, Asia or the Middle East. As I think Air Canada will be charging higher prices, I think looking at Lufthansa flights through Frankfurt and Munich, Etihad flights through Abu Dhabi, Turkish Airlines through Istanbul or Austrian Airlines flights through Vienna may be the best option for those looking for flights to India through Aeroplan.
Lufthansa fees will be gone in the new program
For example, right now a Lufthansa economy class flight through Frankfurt would cost 50,000 Aeroplan miles, but with Aeroplan points after November 8th, 2020, the same flight would cost 60,000 Aeroplan points. The real difference is the taxes, as the current Aeroplan would charge a surcharge of $322 dollars on an economy flight with Lufthansa for a total of $401.01. With the new Aeroplan points, you would only be paying $118.01 ($401.01 - $322 + $39 partner booking fee). Even though Lufthansa's business class product isn’t world leading, the real value in the new Aeroplan points will be close in booking with Lufthansa.
There are a few other examples of redeeming new Aeroplan points, like redeeming Aeroplan points for Air Canada and a Partner Airline on the same ticket and adding a stopover, that will be added to this article as it is updated.
Cancelling Aeroplan Points Reward Redemptions
Aeroplan will now book flights into different revenue buckets, just like revenue tickets. Based on what you book your ticket in, Aeroplan will then charge a corresponding cancellation fee. The most flexible flights, booked in latitude, will more than likely be outside the prescribed price range given by Aeroplan at this time. Although the policy was affected by COVID-19, if there wasn’t the waiver until the end of 2020, cancellations currently cost $125 and changes cost $75 per direction. As you can see in the Aeroplan chart below cancellation fees will be steep if / when Aeroplan removes their free change / cancellation.
Redeeming Aeroplan Points for Hotels
The new Aeroplan points will once again allow you to use your Aeroplan points to book hotels. These typically are a poor value redemption, as you will rarely get 1 cent per point. In addition, Air Canada Vacations will continue to be bookable with Aeroplan points at a rate of 1 cent per point, which is still typically a poor value.
Redeeming Aeroplan Points for Gift Cards
The new Aeroplan points will once again allow you to use your Aeroplan points to redeem for gift cards. These typically are a poor value redemption, as you will rarely get 1 cent per point. Typically, gift cards get you about 0.7 cents per point, a very poor redemption for your points.
The Point
Aeroplan miles will be converted to Aeroplan points at a 1:1 ratio on November 8th. While the name remains the same, pesky carrier surcharges are replaced with a flat surcharge , outstanding 10 cent plus value per point becomes harder to achieve and Air Canada flights will become astronomically priced (except for that 6am flight to Fort McMurray on a Tuesday, of course).
