Redeeming Citi PMs and JP miles for award tickets

This is the last in a 3-part series on Citi PM miles and JP miles. It all began when I was waiting for a flight a few weeks back, and a friend called to discuss some mileage earning and redemption opportunities. That conversation led to this series of posts, as below:

Part 1 covered earning opportunities
Part 2 discussed the value of a Citi PM mile and of a JP mile
Part 3 (this post) deals with redeeming those miles for award tickets

I'd like to make it clear, that this post deals only with redeeming Citi PM and JP miles for award tickets. (Do remember, that Citi PM miles can also be transferred to programs of some of their partners, which are both airline and hotel loyalty programs, and some of those options may well be worth it. You can read more about that in part 2.)

JP miles, on the other hand, can be used only for airline redemptions, although you can redeem them for award tickets on Jet's partner and codeshare airlines too.

Comparing Citi PM and JP miles

So, lets talk about award ticket redemptions. One must remember, that Citi PM miles work on the concept of buying an air ticket by encashing your reward miles. So in a sense, it is not really "redemption" of miles in the strictest sense of the word. JP miles redemption, on the other hand, is a vanilla redemption approach.

Citibank Premier Miles

This should be fairly simple. Citi PM mile values are fixed by Citibank at 1 mile = Rs 0.50 for airline award tickets. And this isn't exactly "redemption" - the ticket you get is a revenue ticket. It's just that you've paid for that revenue ticket using your miles instead of cash. Now that isn't a bad thing necessarily. A revenue ticket means you get all benefits that revenue tickets have - eg, you will continue to earn flight counts, miles traveled, etc, plus any elite benefits. Most importantly, you don't pay a cash component (taxes, surcharges, etc) on miles redemption. This applies to both domestic and international tickets, and same goes for class of travel - economy or business/first, though you'll find that business class tickets often cost more than twice the cheapest economy ticket - which means you're often redeeming more than 2x the required miles.

The biggest advantage of Citi PM miles when redeeming for award tickets, is that you have a large choice of airlines - virtually any airline that will sell you a ticket. Initially, Jet Airways wasn't one of them (and still doesn't show up on search results on the PremierMiles portal), but there's a workaround for this too. This versatility naturally increases the intrinsic value of a Citi PM mile.

However, do remember that an award ticket booked on Citi PM miles comes with the same restrictions that a revenue ticket - particularly a low-fare one - would. This means an absence of refunds for a good part of the ticket value. I haven't had reason to cancel a ticket booked using Citi PM miles, but I suppose any refund value of the ticket would be credited back to your Citi PM points account.

Jet Privilege Miles

JP miles can be quite powerful if used right. JP miles required per sector are fixed, and JP occasionally runs promotions for a 20% discount on miles required for redemption. Naturally, redemptions are limited to flights on Jet Airways and their partner and codeshare airlines, and those aren't small in number (though some may not be available if and after Air India joins Star Alliance). Also, you do have to pay a small cash component of the ticket to cover some of the taxes and surcharges (not YQ - those are included in the ticket price), but this rarely exceeds Rs 1,500 per domestic sector. Also, the miles required for business class are fixed - at 2x the miles required for economy class travel, so unlike Citi PM miles, you're sure of how many miles you will expend for this.

Sadly, most international redemptions aren't worth it. The cash component can be as high as 60-80% of the cost of a normal revenue ticket, and using JP miles for such redemptions significantly devalues the intrinsic value of a JP mile.

Comparing values

Because of the differences in values per JP mile and PM mile, the real issue comes up when trying to redeem miles - particularly when you have both Citi PM miles and JP miles, like I do. But before getting into the choice of redemption, let us consider the various factors that are involved. The most important of these are:

• Date of travel: how close (or far out) is the travel date, relative to the date of booking
• Flexibility: are your travel plans fixed, or do you want to be able to cancel or reschedule your ticket?
• Class of travel: do you plan to travel in economy (coach) or business / first class
• Upgrade rewards: do you want to use miles to upgrade to a higher class, on a paid ticket
• Upgrade possibility: do you want to consider using your miles for an economy ticket, and upgrade yourself for the actual class of travel
• Other costs: what other costs should you expect to incur, or factor into your decision

All of these factors are important - for one reason or the other - when making the choice between redeeming Citi PM miles and JP miles. Here's why.

Date of travel and flexibility

To me, date of travel is one of the most important factors. As I mentioned earlier, when using Citi PM miles, Citi deletes those miles from your account, and "uses" them to "buy" a ticket at market price. Given the way airfares generally move in India, the lesser the time you have between booking date and travel date, the more the fare - and therefore, a greater number of Citi PM miles will be used up. However, if you're using JP miles, the number of miles required for a given sector is fixed. Taxes and fees usually add up to no more than Rs 1,500 on economy class redemptions on Jet, which is the equivalent of about 3,000 Citi PM miles.

I tried out this logic on inter-metro sectors for 2 dates - one very close (25 February 2014) and one that was 6 months out (26 August 2014). For consistency, they are both the same day of the week - Tuesday. Here are the results.

The cash out cost on JP represents the taxes that need to be paid in cash.

The above results may be slightly skewed, because Jet is currently running a promotion for a 20% discount on miles redeemed. Nonetheless, even if this 20% off promotion wasn't considered, JP miles ended up being valued higher than Citi PM miles, as the table below shows.

So in almost all cases, the number of JP miles needed is lower than the number of PM miles needed. Put differently, JP miles (without discount) carry a value in the range of Rs 0.422 per mile (about 20% less than the value of a Citi PM mile, that too in only the MAA-BOM case), but going up to Rs 0.653 per JP mile, ie over 30% more than the redemption value of a Citi PM mile (and I have seen instances of its value going above Re 1, ie more than 2x the redemption value of a Citi PM mile).

However, it is quite another story if you select a departure date well away from today. The fares for then are far lower than today's fares and therefore, the value of a JP mile dips drastically in comparison to the value of a Citi PM mile. See below.

A JP mile never crosses Rs 0.30 in value. The best case is on MAA-BOM, which at Rs 0.284 per JP mile, is almost a 45% write-down from the value of a Citi PM mile.

So I suggest you look up the cash price of the tickets for the date you want to travel, and apply the logic I've used above, to determine which miles to redeem.

As regards flexibility, I've mentioned earlier that Citi PM award tickets have the same restrictions as revenue tickets. For JP awards, however, there is relatively high flexibility for cancellations and modifications. If I recall correctly, cancellation of award tickets entails a 500 miles penalty per ticket (waived for Gold and Platinum members), and there's no charge as such for modifications. This also comes in handy when there are flash sales (like the ones in India recently, which I've written about here and here) - in those cases, if you find the cash fares a better deal, you should try and cancel the award tickets (with/without the 500 miles penalty that may apply to you) and rebook for cash - which you could do even on the PremierMiles portal.

Class of travel

This is the next variable. If you're going to be redeeming Citi PM miles for business class travel, remember that it isn't 2x of the economy class miles that you need. As with cash fares, business class often costs far more than twice the economy airfare. So you'll have to forego that price times 2, in terms of number of Citi PM miles (at a rate of 1 PM mile = Rs 0.50).

On the other hand, the number of JP miles required for business class is 2x the requirement for economy, and 3x of economy for first class. Yes, the taxes will vary, so do keep that in mind.

Upgrade rewards

Because of its nature, Citi PM miles don't permit the concept of upgrade rewards (revenue ticket, upgraded for miles). You can think of Citi PM miles as just another cash currency, valued at 50% of the value of the Indian rupee.

JP miles allow for upgrade rewards using miles, on a revenue ticket. This can be quite painful to initiate at the airport, so if you're looking to use miles to upgrade your class of travel, I'd suggest you call them in advance and put in a request. You aren't committed to this - you still have the option of declining it at the airport, upon check-in, if you so wish.

Upgrade possibility

This is a facility that JP award redemptions carry for award tickets. From select starting points (metros and some other stations), you can upgrade an economy award ticket to business class for Rs 2,000. This price goes down to Rs 1,000 for other starting points. The destination does not matter. This is an excellent option, and a preferred approach over redeeming 2x miles for business class tickets. I've used this every time that this option has been available to me. Just ring up the call center for the facility. However, you need to pay using your credit card, over the phone (or alternatively, visit their booking offices in the city or at the airport counters).

Other costs

You should also remember, that Citi PM miles book across airlines. So the lowest fare you get could be on a low-cost carrier, or on a flight that doesn't have meal service. You may want to factor in the cost of buying a meal on board, in your decision. However, on full service carriers, the meal is part of your ticket cost. This could sometimes work negatively too, in the case of Jet Airways, where the redemption cost is the same irrespective of whether it is a Jet Airways flight (full service) or Jet Konnect (low cost), so you should keep that in mind.

Conclusion

At the end of the day, the aim is to maximise value for your stack of miles on hand. Which one to use - Citi PM or JP - will depend on a combination of the factors mentioned above, and any other variables you may want to consider for your specific circumstances. In short, and as a thumb rule, JP miles usually are a better option for short-notice bookings (when market fares are high), and Citi PM miles are better for dates farther out (when market prices are low).

I hope this series on JP and Citi PM miles was useful. Do let me have your feedback, via a comment, below. thanks!