Asia frequent flyer programmes lose value as US rivals’ ones climb

THE frequent-flyer clubs of marquee Asian airlines including Cathay Pacific Airways and Singapore Airlines fell further behind those of US rivals during the pandemic, highlighting the region-wide damage from prolonged travel restrictions. Led by Delta Air Lines, loyalty divisions at the four major US airlines cemented their positions in early 2023 as the world’s most valuable points programmes, consultancy firm On Point Loyalty said in a Feb 3 report. Apart from Southwest Airlines’ offering, the loyalty programmes are worth more than the stock-market valuations of each of the US carriers, according to the estimated values in the report. Loyalty divisions stood almost alone as revenue generating centres for airlines after the pandemic grounded fleets worldwide in early 2020. The value of the units emerged as stressed carriers including Delta and United Airlines Holdings laid down their points programmes as security against billions of dollars of loans and bonds to get through the Covid crisis. Airlines traditionally disclose few financial details of their loyalty programmes — including their primary source of revenue, which is selling miles to banks that then use them to reward customer credit card use. Asian airlines broadly fared worse in the report’s loyalty rankings versus those elsewhere. China, which before the pandemic was the world’s largest outbound travel market, reopened its international border only last month after a years-long closure that decimated regional flying. BLOOMBERG