American Airlines (AA) miles were devalued in March 2016. Most notably, one-way business class between the US and China increased from 55,000 to 70,000 miles, and one-way first class increased from 67,500 to 110,000 miles. Even so, AA miles still offer the best overall value among the major mileage programs (UA, Delta, CA, ANA) for redeeming economy and business class awards between the US and China. That is thanks to low fuel surcharges, solid award availability on Cathay Pacific and Japan Airlines, the ability to book one-way awards, and the 10% mileage rebate that came with holding an AA credit card. Today, let’s go over how this 10% mileage rebate worked.
[5/2 Update] Both the Citi AA and Barclays AA cards were revamped, and the 10% mileage rebate benefit was eliminated effective May 1. In my view, this was finally the end of one of the most useful airline credit card perks. These days, issuers are all pushing bonus rewards on everyday spending, and honestly the products are starting to feel far too similar. If the main reason you keep either of these cards is for the 10% annual mileage rebate alone, and that value outweighs the annual fee for you, then it may be time to cancel the card.
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1. Overview of the 10% Mileage Rebate
If you held either of the following co-branded American Airlines AA credit cards, every time you redeemed AA miles you could receive a 10% mileage rebate, up to 10,000 miles back per year.
- Citi AAdvantage Platinum (50,000 AA miles after opening the card)
- Barclays Aviator Red (No longer available)
Because you received 10% back on every redemption, if you held one of these cards, your AA miles were effectively worth 1.111... times as much in the ideal case. Opening a Citi AA credit card could net you 55,555 miles in effective value, and each $1 in spending could earn the equivalent of 1.111-2.222 AA miles.
How to Get the 10% Rebate
Requirements to Receive the Rebate
To receive the mileage rebate, you had to still hold one of the two AA co-branded credit cards above, and your total rebate for that calendar year could not yet have exceeded 10,000 AA miles. If you had just received the co-branded card, you could log into your AA account to confirm that it had already been linked to your credit card. In the image below, the left side shows a linked Citi AA credit card, and the right side shows a linked Aviator card.
As long as you redeemed miles from the AA account linked to the credit card, you could receive the rebate regardless of which airline operated the flight, which cabin you booked, or whether you booked by phone or directly online.
If You Held Both Cards at the Same Time
If you held both the Citi and Barclays AA co-branded cards at the same time, the total rebate cap was still 10,000 miles. It would simply show up as 5,000 miles rebated from each card.
If you held two Citi AA co-branded cards and both were linked to the same AA account, the rebate cap still did not increase.
When the Rebate Posted
The moment your award ticket was issued, the miles were deducted from your account, and the 10% mileage rebate would also show up in your account right away. Below is an example of a US-China business class award I booked online with AA miles, and the rebated miles posted immediately.
Tips for Using This Benefit
Although the mileage rebate was straightforward, there were still a few useful tricks worth sharing.
Use Hold and Ticket Separately
What if you didn’t have enough AA miles in your account to book tickets for two people, or a round-trip between the US and China? Take economy class as an example: each person needed 35,000 AA miles per one-way. If you had exactly 68,000 miles, would you need to go to the website and buy 2,000 AA miles at an inflated price just to ticket the award? Of course not. The math is simple: book the first ticket for 35,000 miles and get 3,500 miles back, leaving you with 68,000-35,000+3,500=36,500 miles, which is just enough for the second ticket.
So what is the safest way to do this in practice? First, split the two tickets into separate reservations. If you are booking a round-trip, break it into two one-way flights for the outbound and return (the actual travel experience is the same as a round-trip). If it is for two travelers, book each ticket separately. No matter which method you use, you should ideally take advantage of AA award tickets’ free 5-day Hold feature. The reason is that award tickets take some time to issue, and the rebate is only returned after the miles are deducted from your AA account upon ticketing. If the first ticket goes through and someone else grabs the second seat before you finish, it can be a real hassle if two people can no longer travel on the same flight. So when booking, you should place both tickets on Hold separately, then confirm the first award ticket. After you pay and it is ticketed, you will receive the rebated miles. Then you can confirm the second ticket and ensure you successfully get both seats.
Of course, this method also works if you are transferring SPG points to AA miles for an award booking. If you have a certain number of SPG points, you can transfer over just part of them to your AA account to issue the tickets. As for the minimum number of points you need to transfer when booking separately, just calculate it based on your own situation. After all, SPG points are flexible, and the more flexibility you preserve, the better. For more on SPG points, see:
Book Across Calendar Years
Since each AA account linked to an eligible credit card could receive at most 10,000 miles back per year, if you happened to be booking near year-end and needed two tickets—for example, two economy round-trips—you could ticket one near the end of the year (and get 7,000 back), then ticket the second at the beginning of the next year (and get another 7,000 back). Again, using the Hold feature is recommended. Ideally, day 1 of the Hold would be in late December, and five days later would fall in early January. That would be perfect. Likewise, if you cannot make the Hold period line up exactly across the new year, I suggest booking both travelers’ outbound one-ways first, then booking both return one-ways in the next year, so everyone stays on the same flights.
Allocate AA Miles Wisely
If multiple people in your household had AA accounts and also held eligible credit cards, then when earning AA miles or transferring points, it was best to distribute them somewhat evenly. Since transferring AA miles from one account to another costs money, you generally did not want too many miles piling up in one account; otherwise, once you redeemed beyond the 10,000-mile rebate cap, the value became less attractive. When redeeming, you could work from smaller balances upward and redeem each account as cleanly as possible.
When applying for an AA credit card, if you did not enter your existing AA frequent flyer number, AA would generally assign you one automatically. That means you might end up with two separate AA accounts, each potentially eligible for its own 10,000-mile rebate cap. I have not personally tested this, but if you are interested in churning AA credit cards, you could give it a try. Of course, if one account does not have enough miles, you can always top it off with SPG points.
Things to Watch Out For
How Changes Affect the 10% Rebate
AA award tickets were said to allow free changes, but even if the mileage cost stayed the same, in practice there could be cases where the system refunded the miles first and then deducted them again. Generally speaking, if you did not change the operating airline or the departure/arrival airports, this usually would not happen. The reason this matters is that if you booked a ticket last year and changed it this year, once the system refunds first and re-deducts later, that 10% rebate could count against this year’s 10,000-mile cap.
Other Notes
- If you cancel the ticket, the 10% rebate will also be taken back.
- If you plan to cancel the credit card, it is best to use this benefit first before closing it; you can book first and then change the ticket later.