A huge change - Emirates will now allow Cash+Miles awards

Emirates, one the Big 3 Middle-East based airlines and probably the one with the worst Frequent Flyer program of the lot, has made a small change to their miles redemption program. However, Emirates will now allow Skywards (its frequent flyer program) members to book Cash+Miles award tickets, in addition to all-miles awards. My initial calculation shows that this converts into a HUGE change in value of their miles. Here's more.

I am not a big fan of the Emirates Skywards Program. I think their earn-to-burn ratio is pretty skewed and so I have generally avoided collecting miles on Skywards. But this small change, instantly increased their value just a little bit, in my mind. If this is anything like the BA program, this could help people book their flights, with fewer miles.

Let's delve deeper...

Once I accessed the “Find out how it works” tab on the ad, I landed on this page:

There is a complete video on the top of the page, to take you through the process. Six things of note: 

• They have renamed their ‘Saver’ and ‘Flex Plus’ rewards as Classic Rewards (to distinguish them from cash+miles awards). 
• This offer is only available on Emirates marketed and operated flights. 
• The value of their miles is hardcoded at 2000 miles = AED 58.68 (USD $16) or 1 mile = 0.029 AED. 
• 2000 miles is the least number of miles you can redeem. 
• You get miles for the cash component of your ticket price. Not sure how they would equate in actual terms, if you pay a small part of your ticket with miles and the rest with cash. 
• Most important - it looks like you can save money on any cash ticket you are booking. Unlike the BA program, where you can reduce the number of miles by paying cash, when booking an award ticket, this is exact opposite – you can save on your cash, by using your miles to pay for part of the price of a cash ticket. 

Now let’s see how this converts in terms of actual value. I chose DXB-DEL sector, outbound 14 October and inbound 16 October. For the sake of simplicity, all values are in AED (1 AED = INR 18).

I looked up a one way fare for my chosen sector and date and this is what I got:

With cash+miles, it would require 26,375 miles to equate to 775 AED. Unfortunately I did not have enough miles to see if they allow you to pay for the entire ticket using cash+miles offer or is there an upper cap on this.

I looked up an award ticket for the same date and sector and this was the result:

Emirates doesn’t let you book ‘Saver’ tickets for one way travel. So this is an Economy Flex ticket. Obviously this is much worse than the cash+miles offer. Using this would give me a return of AED 0.015 on each mile. That’s approximately half the value of the cash+miles rates!

Or put simply, if you had 23,750 miles, you could book a cash ticket, and use the miles under this offer to bring you price down by 697 AED, and simply pay 78 AED for your ticket. This is an outright saving of AED 336!

Emirates skywards provides terrible value for one way awards, so I decided to evaluate a return ticket to see the new value. A DXB-DEL return ticket priced out like this:

See how the fare drops even within the Saver bucket, when choosing a return fare. Based on the cash+miles offer, that would require 39,136 skywards miles to bring the price down to zero.

I checked an award ticket and got this result:

Both sectors are now on the saver band. This gives a return of 0.014 AED on each mile – roughly half the value of the cash+miles offer, again.

Looking at it another way, if you had 27,500 miles in your account, you could book a cash ticket and use 27,500 miles to reduce your ticket price by 806 AED and pay only 343 aed for the ticket. So in cash+miles world, this ticket would require 27,500 miles + AED 343. This is straight up saving of AED 407.

Based on this I would say Emirates just managed to double the value of its skyward miles for its customers. Not only that, those spare miles in your account that never get used (I have around 2,000 which could never be used for flight redemption in any way possible), can now convert into cash savings.

Emirates on-board lounge

Now I know some of you might be using Skywards miles for upgrades or redeeming them on business class seats and that might give a different value for the miles. Would love to hear your thoughts on how this change works out for your redemptions.

I will experiment a little more this week on the value of miles, using sectors like DXB-JFK, DXB-LHR, DEL-DXB-SFO, to see how the new valuation of their miles stacks up against their award chart, but based on preliminary look I would give 2 thumbs up to Emirates.

Readers: What do you think? Did you find a sector where the award chart gives better value?