Merger Dividends: Discrepancies and Low Cost Upgrades

April 2011
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Seven Ways Anyone Can Take Advantage of the United-Continental Marriage

On March 3, Continental and United started offering mileage transfers between each other’s frequent flyer programs and granting elite-status matches.

At first glance this seems like par for the course, given the merger. But when we looked into it, we uncovered that there are ways that anyone—not just Continental and United mileage members—can score a free or discounted upgrade. Here are seven strategies to pursue.

1: How to double your chances of scoring a mileage-award redemption

Check both airlines’ award-redemption calendars online and transfer miles into the one that has the seats. For example, our research turned up that Continental has favorable Business Class saver mileage availability from New York to Mumbai in November and December, but United does not on Continental flights.

2: How to save up to 120,000 miles: Know which carrier offers the better redemption value

Both airlines offer a round-the-world Star Alliance mileage-redemption award. But Continental’s First Class award costs 120,000 fewer miles than United’s, enough for a second free ticket in Business Class to many international destinations. In Business Class, Continental charges 80,000 fewer miles, enough for a second free First Class ticket for domestic travel, to Central America or the Caribbean.

Round-the-World Premium Ticket Savings

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3: How to get more access to mileage-redemption partners

Both airlines are part of the Star Alliance, and both have partners outside the alliance, a potential source of more mileage-award inventory. For example, if you can’t find award travel on United, check for space on Continental’s partner Virgin Atlantic (until June 14). If it’s available, book the ticket by transferring miles from your United account to Continental’s mileage program.

4: How to get an instant elite upgrade at time of booking

Ask Continental to match your United elite status so you can take advantage of the instant upgrade the carrier offers at time of ticketing to elites who book B fares. This yields two big benefits:

  • It gets you out of the elite-upgrade game, which is especially good for bottom and mid-tier elites, who usually have to wait until 48 to 72 hours before departure to get upgrade confirmation.
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  • The B-fare on Continental can offer savings of 40% or more over a premium ticket on United. From Chicago to New York, United charges $1,644 (plus taxes and fees) for a round-trip First Class ticket; whereas a B-fare ticket on Continental costs $944, a savings of 43% ($700).

Top elites: Your savings are even greater because Continental also allows instant upgrades on M fares (a lower economy fare than B). The savings can be as great as 62%. On LAXJFK, United charges $2,990 for a round-trip Business Class ticket, while Continental asks $1,152 for an M fare; a savings of $1,838.

5: How to get a free premium ticket

Entry level credit-card strategy: Start by getting both airlines’ mileage credit card—a Chase Visa with no annual fee the first year and a 25,000-mile bonus with the first purchase—and take advantage of the double signup bonus promotions. Then combine the miles into one carrier’s program to net 50,000 miles. That’s enough for a First Class award ticket, albeit on a two-cabin aircraft, within North America (not including Hawaii).

Mid-level credit card strategy: Get another 10,000 miles by adding a name to each credit card (5,000 miles per card). Now you have 60,000 miles, enough for a free First Class ticket to the Caribbean or Central America.

Advanced credit card strategy: Sign up for the American Express Platinum card (annual fee $450) and you’ll get 50,000 reward miles when you spend $1,000 (that comes out to less than one cent per mile). Transfer the miles to Continental. Now you have 110,000 miles, which is enough for a Business Class ticket to Europe and South America or a First Class ticket to Hawaii.

6: Enjoy one-way award benefits

Until June 14, transfer Continental miles to United because its one-way awards offer more flexibility. For example, allowing you to fly a different class on each leg of the trip. These awards are also perfect if you can only get award space on part of the trip and for some cruise itineraries, where flying is only required one-way. (Continental starts offering one-way redemption on or after June 15.)

7: Never transfer credit card points to United directly

Because the exchange rate is awful: One mile for two Starwood points. Instead, transfer credit-card points from American Express Membership Rewards to Continental and then ship them to United. But get moving: This option expires on September 30.

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<small><i>*Until June 14; on June 15, Continental’s cost will change: 350,000 and 260,000.</i></small>