Why I’m buying AA miles…

AA is having another buy miles promotion until December 31. While View from the Wing isn’t buying any miles, I am. Why?  Primarily that I live in Canada and churning is not so easy. Furthermore, unlike Gary, I unfortunately don’t have a 7 figure AA mileage balance, only 6. I can burn that pretty quickly.

If you look at the numbers,

  • Price of 50,000 miles: $1375
  • Taxes: $103.13
  • HST ;( : $165
  • Processing fee: $35
  • Foreign Exchange Costs: ~3% (maximum) = $50.31
  • Total price: $1728.44
  • Cost per mile: $0.023

So what this means, is that first of all, you wouldn’t be using this to buy miles for a roundtrip, because other programs like US/Avianca would be much more effective. So the only awards that I would consider would be long-haul first class, because it’s worth the premium. If you’ve never flown first class, you have to try it. And here is a cheap way to do so.

Note that this is only useful for non-elite flyers, as elites would receive bonus miles for flying that would make the offer not so attractive. Also, anyone can buy miles. So whether you are in Canada, or Europe, or Asia, or Oceania, you can take advantage of this.

When I mean cheap, I mean cheap compared to selected transpacific flights that are just around the same cost as buying miles. Take for example, a direct YVR-HKG roundtrip leaving within the next 14 days. The lowest price flying directly is just around 1400 to 1500 dollars.

Really expensive fares!

So what that means, is that buying 50,000 miles – or even 40,000 and less (and making up the rest if you already have AA miles in your account or transfer from other programs) is worth it to get first class on a leading carrier like JAL or Cathay Pacific. Furthermore, you can tack on another free oneway with your stopover at the North American Gateway City. To make things short, basically AA allows you to make a stopover at the first North American destination you reach. So theoretically, I could do CX F HKG-YVR[Stop]-JFK. That’s oneway is halfway towards another vacation, in first class.

To get to your Asian destination, I would use Avios to fly either in business or economy class. Either way, what you get is this:

 Pay Cash  Use Points
 ~$1400 + taxes for an Economy Round-Trip  ~$1400 + taxes for 67,500 points F OW CX/JL
 10,000 EQM earned  0 EQM earned
 25,000-60,000 Avios + ~$160 taxes for OW Y/J
 What you miss:  What you miss:
 First class one way (and business class the other)  35,000 (10k EQM + 25k RDM)

Again, note that this is only for redemptions where you have in mind where the ticket price would exceed the cost of buying miles for the one-way flight in F. So how did I come to this? I did it myself. A close friend is flying Cathay Pacific First Class one way Business class the other, at the same price as an economy ticket, and only 60k miles out of pocket. Assuming a pair of Shanghai Tang pajamas goes for 70 bucks plus in retail (and possibly more for the Cathay branded ones on ebay) that’s a good deal, right?

If you need help, tweet @reykjeff or email jeff@canadiankilometers.com. Also remember to subscribe in the top right corner of the page!

 

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