Air Canada, Aeroplan split: What does this mean for you?

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Aeroplan points collectors may be disgruntled to learn that Air Canada is cutting ties with the wildly popular loyalty points program.

Though the split is a few years down the line, here's what you should know about it - and what this could mean for your credit card and your loyalty points.

Why did Air Canada and Aeroplan cut ties?
On May 12, 2017, Air Canada and Aimia Inc., which runs Aeroplan, announced that their partnership will expire in June 2020. After that, Air Canada is forging ahead with a loyalty program of its own, taking its 26 Star Alliance partners, from Lufthansa to United Airlines, with it.

"The new program, launching in 2020, will offer additional earning and redemption opportunities, more personalized service and a better digital experience for Air Canada customers," Benjamin Smith, the airline's president, said in a statement.

He said an in-house program will lead to better options for consumers.

Karl Moore, a McGill University professor specializing in business management, agrees with Air Canada's decision.

"What Air Canada wants to do is keep flyers loyal to Air Canada and Star Alliance and use reward seats and other rewards in a way that costs them less money," he says. "Air Canada saw the end of the relationship because they figured they could do it better themselves and at less cost."

What cards will be affected?
TD, American Express and CIBC offer a range of credit cards tied to Aeroplan. They include:

  • TD Aeroplan Visa Platinum
  • TD Aeroplan Visa Infinite
  • TD Aeroplan Visa Infinite Privilege
  • American Express Aeroplan Plus
  • American Express Aeroplan Plus Gold
  • American Express Aeroplan Plus Platinum
  • CIBC Aero Platinum
  • CIBC Aerogold Infinite

For now, Amex and TD are telling consumers that everything is staying status quo until further notice.

"There's no change to the Aeroplan program, miles earned, or for TD Aeroplan customers at this time," Cheryl Ficker, a TD spokeswoman, said in an emailed statement.

"I can confirm that there are no changes for any American Express card members at this time," Amanda Betti, an Amex Canada spokesperson, said in an emailed statement.

CIBC's spokesperson Susan Kirwin also said any changes likely are years away.

"There are three years remaining on the current agreement between Aimia and Air Canada, and there is no change to the CIBC Aeroplan Visa card program," she said. "It's business as usual for our clients. CIBC Aero cardholders can continue to collect and redeem Aeroplan miles as usual, and travel bookings are not affected."

What does this mean for my Aeroplan points?
Nothing - for now. Between May 2017 and June 2020, Aeroplan members can still continue to earn and redeem Aeroplan miles for Air Canada flights. Air Canada even suggests it "intends" to continue to offer Aimia redemption seats post-2020.

Air Canada said that "doing the right thing" during the transition period is the airline's "guiding principle."

Aeroplan, for its part, says the loyalty program is "committed to business as usual."

Moore says both parties are putting consumers' best interests first during a tumultuous time.

What should I do in the upcoming years?
Use your points, says Steven Zussino, a British Columbia-based travel hacker and author of Travel Hacking for Canadians.

Just because you'll be able to use your points for another couple of years doesn't mean you should keep hoarding them. You don't want to get caught with a ton of points come 2020 when it might be too late, or when something might come up (such as illness) that prevents you from taking your trip.

"I'm glad they made the announcement because it gives us consumers a reasonable amount of time to use up those miles," Zussino says.

Even if contracts aren't expiring, he doesn't recommend sitting on a heap of points, because rewards can be devalued at any time.

If you don't want to travel, or don't have enough points to cover a trip, Aeroplan offers rewards other than flights, such as gift cards, movie tickets, spa treatments, clothes, appliances and workout equipment.

"You will find many things to do with your points, but flights offer the most value," Zussino says.

You should also take the time to do your research as to whether your credit card is going to still be beneficial after the split, says Mark Kalinowski, a Calgary-based credit counsellor.

If you have an Aeroplan credit card, pay attention to any changes that may be looming. If you hang onto the card into 2020, you could be charged an annual fee you can't back out of.

What will happen in 2020?
It's hard to say. Air Canada is vowing to launch its own program, but it's unclear if it will partner with banks or issuers to create credit cards that rack up Air Canada points.

Moore is very confident that the airline will strike up alliances with banks, credit card companies, and gas stations.

It's also unclear what's next for Aimia and Aeroplan.

"We know how much you care about this program, and we're working to secure great new redemption options for you after June 2020," Aeroplan said in a statement about the split.

The trio of experts agree on one thing, though: this is all good news for Canadian consumers.

"Both sides are giving it a couple of years so they can figure out their strategies and how to attract you because you're valuable," Moore says. "You have money, you spend money, and they want to capture your business."

"We're going to see a ton of promotions over the next couple of years," Zussino says.

Your job is to pay attention to the credit card deals, and pick the one that most appeals to you.

See related: How to choose the best travel rewards card for you, The best way to pay on an international vacation
Published May 19, 2017

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