American Express compensates only some cardholders
Company has dropped a major perk — free airline lounge access — of its platinum card and only some customers get cash credit.
The New York Times
Northwest travel guides
I didn’t get an offer of an extra $500 in credits for various airline-charge reimbursements from American Express on my American Express Platinum Card. I wasn’t offered $200, either.
Neither were many readers who contacted me about American Express dropping a major perk of its $450-a-year Platinum Card as of March 22, 2014 — free entry into airport lounges operated by the now-merged American Airlines and US Airways.
But I also heard from readers such as Jeffrey Rosenbaum, who received an offer of an extra $500 in credit on his Platinum Card — a card on which he said he charges “well over six figures a year.” And I heard from others, such as Nestor Ruiz, who received a $200 extra credit.
Rosenbaum, incidentally, said that he valued his Platinum Card not just for lounge access but for other benefits, like the ability to use reward points for flights on various airlines, rather than on a single one. “I recently transferred American Express points to Air France and can fly nonstop round-trip from LA to Paris,” he said.
Trying to calm the commotion over the loss of the American-US Air lounge benefits on its $450-a-year Platinum Card, American Express has been emailing selected cardholders with make-good offers of extra credits next year. But as word spreads about the selective nature of these offers, I wonder if American Express failed to anticipate blowback from those who got nothing, and who were already evaluating whether the Platinum Card is still worth $450 a year.
“These offers are targeted to select card members based on a number of factors that I’m not allowed to share,” Melanie L. Backs, a spokeswoman for American Express, said in an email response. She did not return phone calls seeking further comment.
American Airlines is ending free lounge access to Platinum Card holders because of its complex partnership with Citigroup, which issues a line of AAdvantage credit cards, branded with the airline’s mileage program. Effective March 22, Citi recently announced, its extravagantly named Citi Executive AAdvantage World Elite MasterCard (also at $450 a year), will be the only card in the United States offering free access to American Airlines lounges. American Express and its Platinum Card were shown the door.
The perplexed responses to the loss of a major Platinum perk underscores the complications, and the cutthroat competition, in these credit cards. Billions of dollars a year ride on the presumption that frequent travelers will pay fees, whether $50 a year, or $450, or more, for a card that provides perks ranging from priority boarding and a free checked bag, to lounge access and international mileage awards in pampering business class cabins.
Brian Kelly publishes ThePointsGuy.com, which seeks to impose order on the bewildering world of travel award points and credit cards. Many travelers pay for the Platinum Card because they do the math, and its various benefits add up to more than $450 a year in value, he noted. But with the loss of the American lounge access, that math may not quite add up in 2014 for some cardholders.
“There are other cards out there that might give you more value, with lower fees, offering, say, big sign-up bonuses,” he said. “I always think a consumer should sit back at times like this when you’re thrown a curveball and actually assess, if you’re not able to make it to that $450 a year in value, there are other cards out there” with various offers and bonuses to factor in.
I recently got an American Airlines AAdvantage MasterCard that costs $95 a year, with a bonus of 40,000 miles on American. But next year, having pocketed those miles, I’ll probably cancel that card when renewal time comes. That’s the way the game is played — but it can get complicated.
For example, the American Express Premier Rewards Gold Card, which costs $175 a year, provides three times the reward points as the Platinum Card. “While the Premier Rewards Gold doesn’t come with all the bells and whistles of the Platinum Card, you could be reaping in hundreds of dollars of value more a year just in extra miles,” Kelly said. American Express is now offering that card with the first-year fee dropped, and a bonus of 25,000 points. But that offer is not available to current Platinum Card holders.
The Platinum Card still offers benefits that can hit more than $450 a year for many travelers. There’s the standard $200 credit toward airline fees, and $100 toward enrollment in Global Entry. And the card still provides free entry to Delta Air Lines’ extensive network of Sky Club lounges in the United States and abroad. It also provides membership in Priority Pass, with access to hundreds of international airport lounges, including some in the United States — though not those operated by United Airlines (or, starting in March, American and US Airways.)
Meanwhile, as I noted last week, American Express is providing Platinum cardholders with free access to two luxurious Centurion lounges it opened this year at the Las Vegas and Dallas-Fort Worth airports. Leases have been signed for Centurion lounges at San Francisco and New York’s La Guardia airports, and the company plans a wider network after that.
But since these upscale lounges are branded under the name of the American Express exclusive, invitation-only Centurion Card (which costs $2,500 a year), can lowly Platinum Card holders expect that free access to continue?
“Our intention is to keep this an embedded benefit for Platinum Card members as we roll out new lounges,” Backs said.