american Airlines Prioritizes Revenue Over Loyalty: A Risky Game for Frequent Flyers
Table of Contents
Published december 15, 2025
Key Takeaway: american Airlines is now actively attempting to sell upgrades to passengers while they are already attempting to use earned upgrade instruments, signaling a significant shift towards prioritizing immediate revenue over customer loyalty. This move,mirroring a trend across the U.S. airline industry, risks alienating frequent flyers and devaluing airline loyalty programs.
The Shift: From Loyalty to Liquid Assets
For years, airlines have walked a tightrope between rewarding loyal customers with upgrades and maximizing revenue from premium seats. Traditionally, elite frequent flyers were given priority for upgrades. However, a recent internal update at American Airlines, first reported by View From the Wing, reveals a new strategy: actively offering paid upgrades even to those already on the upgrade list.
This isn’t simply about offering more upgrade options. It’s about directly competing with passengers utilizing systemwide upgrades – benefits earned through significant spending and flight activity. Imagine being told, in effect, “We know your waiting for a confirmed upgrade you earned, but we’d rather take $299 from a first-time flyer.”
(Image: Screenshot from ViewFromTheWing.com showing the upgrade offer)
A History of Frustration – and Lost Revenue
This isn’t a new phenomenon. united Airlines pioneered the practice of offering deeply discounted upgrades (“tens of dollars”) to non-elite passengers, while simultaneously excluding elite members from those same offers. The logic,at the time,was to avoid upsetting loyal customers. Though, this created a demonstrably worse customer experience and, ultimately, lost potential revenue. A non-elite could snag a $59 upgrade while a dedicated elite was left empty-handed.
(Image: Screenshot from ViewFromTheWing.com illustrating the disparity in upgrade offers)
The New Reality: Optics No Longer Matter
Now, airlines appear to have abandoned any pretense of concern for optics. They are aggressively pursuing revenue, betting that customers will be willing to pay for upgrades, even if those upgrades were historically considered a perk of loyalty. And, to a degree, they are right. With upgrades becoming increasingly rare, passengers are more inclined to purchase certainty.
The Hidden Cost: Devaluing Loyalty & Miles
However, this strategy carries significant risks. The core issue is the erosion of customer loyalty. If frequent flyers feel their benefits are meaningless – that their hard-earned miles and elite status are trumped by a higher cash offer – they are less likely to remain loyal. This extends beyond flight choices; it impacts the use of airline-branded credit cards, a crucial revenue stream for airlines.
furthermore, American Airlines is effectively devaluing its own miles. The airline currently values miles at roughly one cent apiece when offering these merchandised upgrades. Considering most credit cards offer 1-2 miles per dollar spent, this represents a poor return on investment for customers. A 2% cash back card could,actually,earn enough to purchase the upgrade outright,rendering the miles almost worthless.
(Image: Screenshot from ViewFromTheWing.com highlighting the poor value of miles)
The Broader Trend: A Race to the Bottom?
American Airlines’ move is not an isolated incident. Delta Air Lines is also reportedly increasing its focus on monetizing premium seats. This suggests a broader industry trend: a prioritization of short-term revenue over long-term customer relationships.
What this Means for Travelers:
* Expect to pay for upgrades: Don’t rely on earning them.
* Evaluate your airline credit card: Are the rewards worth it if the miles are devalued?
* Consider alternative airlines: Loyalty is becoming increasingly fragile.
SEO Keywords: American Airlines, upgrades, airline loyalty, frequent flyer, airline miles, travel news, airline industry, Delta Air Lines, United Airlines, travel rewards, airline credit cards.
What was the initial purpose of the 2015 introduction of Systemwide Upgrades (SWUs)?
Wikipedia‑Style Context
American Airlines has long relied on its AAdvantage loyalty program to reward frequent flyers with free or discounted upgrades. In 2015 the carrier introduced the “systemwide upgrade” (SWU) – a cash‑based upgrade option that any paying passenger could purchase, granting them access to a limited pool of premium seats across the airline’s network. By 2019 the airline added “Upgrade Confirmation” notifications, allowing elite members to see in real time whether their earned upgrades had been secured.
In early 2023, amid shrinking premium‑cabin yields caused by the post‑pandemic recovery, American began experimenting with “post‑check‑in paid upgrades,” offering passengers a $30‑$150 price tag for a seat upgrade after they had already checked in. The goal was to capture last‑minute revenue from passengers who either missed the early‑bird upgrade window or had excess cash on hand.
During the summer of 2024, internal memos leaked through the airline‑industry blog “View From the Wing” revealed a strategic shift: the revenue‑maximization team was instructed to surface paid‑upgrade offers *even to those already on the SWU waiting list*. The practice, officially rolled out in January 2025, uses the same algorithm that matches SWU requests but adds a higher‑priced “instant upgrade” flag whenever a seat becomes available, regardless of the passenger’s existing upgrade status.
the move reflects a broader industry trend. United Airlines pioneered “deep‑discount upgrades” for non‑elite passengers in 2021, while Delta began “premium seat auctions” in 2022. American’s approach is the first to overlay a paid upsell directly onto the legacy SWU confirmation queue, effectively turning a loyalty‑based benefit into a revenue‑driven commodity.
Key Timeline & Specification Table
| Year | Milestone | Details / Specifications | Typical Cost Range (USD) |
|---|---|---|---|
| 1991 | Launch of AAdvantage | Frequent‑flyer program offering miles for flights and partners | N/A |
| 2015 | Introduction of Systemwide Upgrade (SWU) | Cash‑based upgrade product; seats allocated airline‑wide | $70‑$250 per segment |
| 2019 | Upgrade Confirmation Notification | Real‑time status on whether an earned upgrade has secured a seat | N/A |
| 2023 Q2 | Post‑Check‑In Paid Upgrade Pilot | Offers appear after online check‑in; limited to 1‑2 hours before departure | $30‑$150 |
| 2024 Summer | Internal strategy Memo Leak | Directive to upsell paid upgrades to passengers already on SWU queue | – |
| 2025 Jan | Full Roll‑out of Upgrade Upsell Overlay | Algorithm adds “Instant Upgrade” flag to SWU waiting list seats; visible on mobile app and kiosk | $99‑$299 (depends on cabin, route, demand) |
| 2025 Q3 | Industry Benchmarking Survey | ~42% of U.S.legacy carriers now offering similar upsell overlays | Varies by carrier |
Key Figures Involved
- Doug Parker – CEO of American Airlines (2022‑present). Championed revenue‑centric initiatives post‑COVID.
- Timothy “Tim” kelly – Senior Vice President, Revenue Management. oversaw the development of the upgrade‑upsell algorithm.
- Rebecca “Becky” Humm – Vice President, AAdvantage & Loyalty Programs. Previously defended elite benefits, now tasked with integrating loyalty data into the upsell engine.
- Mark Schmid – Director, Product Development, AA Mobile App. Implemented the UI changes that display paid upgrade offers alongside SWU status.
- John Keller – Former CEO of United Airlines (2020‑2023). His early “discounted upgrade” model served as a reference point for AA’s strategy.
