Rising Award Fees: JetBlue and Virgin Atlantic Join the Trend

Rising Award Fees Are Back

It’s no surprise that as fuel prices rise, airlines are reintroducing fees on award tickets (previously known as "fuel surcharges"). JetBlue and Virgin Atlantic are the latest names to join this worrying trend.

JetBlue Starts a New Trend

For years, airlines have been frequently adjusting award ticket prices. Typically, this has meant increasing the number of miles required, changing dynamic pricing, and reducing the number of available tickets. Now, a new factor has entered the mix: surcharges.

JetBlue has recently begun imposing fees on award tickets booked through United Airlines, raising concerns as this means customers will face additional costs ranging from $200 to $260 for each one-way trip, even in economy class. While redeeming miles with United Airlines for JetBlue tickets was never a great deal, it has now become even worse. This is particularly alarming, as if this trend spreads to other programs like Aeroplan, a valuable and popular currency could quickly lose its worth.

Virgin Atlantic Increases Fees Too

Similarly, Virgin Atlantic has raised fees on award tickets. The airline has never shied away from adding surcharges without prior notice, and this signals the devaluation of their Flying Club program. Ticket prices and surcharges have now escalated to an unacceptable level.

Economy class has been hit hardest; for example, a one-way ticket from the U.S. to London has jumped from around $111 to $164, a staggering 50% increase. Premium economy fares have risen from about $240 to $298, a 25% hike. Business class fares have also surged from roughly $586 to $701, a 20% increase.

Notably, on flights departing from London, surcharges have nearly reached $1,000 for business class, a shocking spike in just one week.

Other Airlines Take Note

The airline industry is rediscovering the allure of "free" flights (let's be clear, no ticket is truly free; redeeming miles is just a different form of payment). Speaking of surcharges, we have seen numerous airlines increasing their prices. For instance, Cathay Pacific has raised fuel surcharges across its network, Air France-KLM has introduced new fees for long-haul flights, and Emirates continues to hike surcharges for award tickets.

British Airways has long been notorious for imposing high surcharges, and I anticipate that many new fees will be added to BA flights immediately, especially with Virgin Atlantic leading the way.

Predictions for the Future

If fuel prices do decrease, that doesn’t necessarily mean these surcharges will be rolled back. My prediction is that these fees will persist for a long time, even if the situation in Iran stabilizes and oil prices return to pre-war levels. Why? Because when all airlines do this, they have a reason to keep it going.

It will be very difficult for any airline to dare to reduce surcharges in the current climate, as they are all trying to recover from the recent shock of rising fuel prices.

Conclusion

JetBlue and Virgin Atlantic have added hefty surcharges to award ticket redemptions, and this may just be the beginning. As fuel prices rise and airlines seek new revenue streams, surcharges on award tickets are making a comeback (not that they ever completely disappeared). As more airlines experiment with these measures, don’t be surprised if this becomes the new norm. If airlines realize they can charge you both in miles and cash… they will.

I plan to book several award flights this year and perhaps it’s wise to reserve tickets sooner rather than later. You should do the same…