Delta has been getting a lot of bad press lately regarding changes to its SkyMiles frequent flier program (including right here on the blog). But yesterday, Delta did something strange. It actually made some improvements to the program (unless you like flying on Alaska). One in particular, the earning of Medallion Qualifying Dollars, is interesting in that it heaps on more complexity to an already complex program. But that was the only way to make this work.
Back in 2013, Delta announced that to qualify for elite status, or uh, Medallion status as the airline calls it, you’d have to spend a certain amount of money with the airline (or you’d have to spend $25,000 a year on the Delta Amex card). Previously, you just had to fly a certain amount and earn enough Medallion Qualifying Miles (MQMs) to make the cut. That meant you could do mileage runs at the end of the year and spend little money to squeak over the threshold. Delta didn’t like that, and I can’t blame the airline.
These new Medallion Qualifying Dollars (MQDs) required spending a
penny dime per mile required to achieve status. In other words, the lowest level used to only require 25,000 MQMs. All of a sudden, it also required spending $2,500 MQDs during the year. This year, the threshold went up even further. Low level elites now need to spend $3,000 during the year. For people who are actually flying enough to qualify without playing mileage run games, this shouldn’t be all that hard. And it’s not an unreasonable ask for the airline.
That being said, there’s always been one awful, gaping hole in this methodology. While fares and surcharges counted toward the total (taxes didn’t), it only applied to some tickets. Those issued by Delta (or by travel agents using Delta ticket stock) counted. Anything booked on the Delta code regardless of the ticketing airline also counted. But partners? Nope. Not even tight joint venture partner Air France/KLM counted toward status.
This sounds insane since technically Delta shouldn’t care if you fly on its own airplanes or those of a joint venture partner since the revenue all gets split up anyway. But there’s a technical reason why this is the case. Delta doesn’t actually know what you spend on other airline tickets except when flights are on a Delta code.
Of course, when you buy a ticket issued by Delta (or by a travel agent using Delta ticket stock), then Delta knows exactly how much you’ve paid. Not only does it know how much you paid for its flights but it knows how much you paid for any other airline flights on that ticket. The money all gets settled up later through the industry’s clearinghouses, the Airlines Reporting Corporation (ARC) or Billing and Settlement Plans (BSP).
At the same time, if somebody has a ticket issued by another airline, Delta will eventually know how much you paid if the flight is on a Delta code. Delta ends up being involved in the settlement process in that case, so the revenue comes in.
But if you buy a ticket on, say, Air France, and there is no Delta segment in there, well, Delta has no clue what you paid. And the tech work involved along with the negotiation required to get the other airline to share revenue data is monumental. But Delta decided this revenue requirement was still a good plan, so it just outright banned other airline travel from accruing MQDs. That pissed off a lot of people.
Now, however, Delta has a solution. Oh no, it didn’t get better revenue data. It’s just introducing a separate way to calculate MQDs when you fly on partners. So you’ll get something, but it just won’t be tied to revenue. And it’ll be different than what you get when you fly Delta itself. More complexity.
MQDs will be awarded on partners the same way MQMs are awarded. It will be a percentage of miles flown, but the MQD value is a lot less than the MQM. And of course, Delta has decided to use different percentages with different partners. At least they publish these rates.
For example, a cheap coach ticket on Aeromexico gets 10 percent of miles flown awarded as MQDs. (Those get 50 percent MQMs.) Meanwhile, the cheapest coach seat on Air France gets 5 percent awarded as MQDs. At the other end of the spectrum, a full fare business class ticket on Virgin Atlantic will get 40 percent awarded as MQDs. If you’re flying on a partner, you’ll need to look up the partner page to see what you’ll get… depending upon the partner.
Delta elites will earn MQDs on nearly all of Delta’s partners. Most of the ones that are left out are the usual suspects. There’s perennial-enemy Korean, Hawaiian, Great Lakes, WestJet… and Alaska. Now that’s interesting.
We all know Delta and Alaska have been brawling, but you could still earn MQMs when you flew Alaska. That doesn’t change, but you will not be able to earn MQDs. Before, if you had an Alaska flight on a Delta ticket, you could at least earn MQDs then, but that has been stopped as well. The erosion of the partnership continues.
But back to the point, this is good news. It means Delta elites can finally earn MQDs when flying partner airlines. That always should have been the case. It’s just makes an already complex program even more challenging to follow. It would be nice if Delta just awarded everything this way, but that would have been too easy.
[Original girl with textbook photo via Shutterstock]