American Airlines Reverses Course on Hated Loyalty Plan Change

Advisors on both sides of the US-Canada border are doing a happy dance after American Airlines backed down on its highly unpopular plan to stop issuing loyalty points on travel agent bookings.

ACTA, the American Society of Travel Advisors (ASTA), and the World Travel Agents Associations Alliance (WTAAA) all fought vigorously against AA’s plan. ACTA said American’s ill-advised proposal “would have had an extremely detrimental impact on the retail travel community limiting traveller loyalty points accrual to bookings made by ‘preferred’ agencies and direct bookings only.”

“ACTA expresses its sincere gratitude to all members who actively engaged in the advocacy initiatives, as their participation was instrumental in achieving this positive outcome,” said ACTA President Wendy Paradis. “While this development represents a significant victory for the retail travel sector, ACTA remains committed to maintaining a vigilant stance in protecting its members against any future actions or policies that may pose a threat to their business operations.

“ACTA recognizes the importance of safeguarding the interests of its members and will persist in its advocacy efforts on their behalf,” she said.

The association will maintain its close collaboration with ASTA, WTAAA, and other key players to ensure that the concerns of the retail travel community are effectively communicated and addressed at the highest levels of the industry, Paradis added.

ASTA was so angry with the plan that it started a public campaign to make American rescind a plan it called “anti-consumer” and “anti-competitive.”

Angry agents claim the move is a way to force agencies to adopt American’s NDC or get consumers to bypass advisors by booking directly with the airline.

"This latest development doubles down on American Airlines' clear agenda since last year to force the travel agency industry to adopt immature technology, monopolize distribution channels, and squeeze channel partners and customers for cost-cutting and profit," ASTA said earlier this year. “American’s behavior is monopolistic and should be concerning to lawmakers who value consumer choice."

Speaking at a financial conference Wednesday, American Airlines CEO Robert Isom said that the airline was scrapping the plan as part of a broader effort to pull back on its recent distribution strategy. That strategy was meant to encourage customers to book directly with the airline, meaning the carrier would not have to share a cut with a travel agent or booking service, thepointsguy.com reports.

Isom said the broader strategy, along with the specific tactic of restricting mileage earning, were creating confusion that was driving customers to book tickets with rival airlines.

"That's off — we're not doing that because it would create confusion and disruption for our end customer," Isom said. "We need to work closely with our agencies and partners to ensure that the transition that we're making is not disruptive to our end customers."