Can you get the cheapest airline seats with reward points?
Basic economy saves some money, but not necessarily points
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Dear Cashing In,
I saw that airlines have started selling cheaper discounted fares that don’t include things like checked bags and space for carry-ons. If I use credit card points or miles for a plane ticket, will I have to pay a bunch for those extras? – Michelle
The pricing of airline seats often puzzles consumers. On a plane, you could be paying hundreds of dollars more than the person next to you, even though you are receiving the same service. It depends when you buy, when you are returning and so on. It might not seem to make a lot of sense, but airlines spend a lot of time figuring out ways to reap the most amount of money from a flight.
The latest trend in seat pricing by the major U.S. airlines is called “basic economy.” In February 2017, American and United started selling basic economy fares on certain routes. Delta introduced its version of basic economy in 2015.
Basic economy fares cost less than normal economy fares – usually around $20 per flight segment – but they also come with some important restrictions. You can’t make seat reservations. You board in the last group. And on American and United, you cannot use the overhead bins for carry-on luggage. You can carry on only a small personal item, like a purse or backpack. Anything else must be checked (for a small fee, naturally).
So how do award tickets work now that airlines offer a category of fares cheaper than regular economy? The answer is, so far, there is no overlap.
On United, Delta and American, if you have frequent flier miles from flying or from using an affiliated credit card, there is no way to book seats in basic economy. The lowest level of seats you can book with miles is regular economy, which allows you to reserve seats ahead of time, carry a bag onto the plane and perhaps board a little earlier.
Don’t be surprised in a few months or years, though, if the airlines alter this approach and allow you to book no-frills seats with miles. Airlines are notorious for making changes that benefit them little by little, as opposed to all at once.
One area that will be immediately affected, though, is if you are using reward points to book airfare on a bank’s travel portal. For instance, if you have Chase Ultimate Rewards points or American Express Membership Rewards points and you book a ticket through those bank sites, you could face those seat reservation and boarding restrictions if you select a basic economy seat. The way those portals work is that you are basically buying a seat, except you are being charged in points. If you buy a seat, you have the restrictions that come with that seat.
Right now, it’s not much of a worry. But it’s something to keep an eye on as airlines continually redefine what costs extra.
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