UPDATE: The Delta CEO told CNBC the new changes to the program will be announced “in the coming days”!
Tomorrow is the DAL Q earnings call (disclaimer neither Chris or I hold or plan to hold DAL stock anytime soon). It will be interesting to see what impacts higher fares, higher oil prices and the 9/14 bomb shell Medallion program changes as well as Sky Club access news all have on the company.
It also sounds like, from all the chatter around the web, that tomorrow may be the day Delta tells us just what the program rollbacks will be (the CEO Ed Bastian that many are now calling “Fast Eddie” hinted that the company will make adjustments).
So with this in mind I thought it would be good to share my thoughts of what Delta will likely do, if not tomorrow, very soon in an attempt to stop folks from jumping ship and giving up on Delta and becoming a free agent, that is, flying Delta when convenient but also flying other airlines rather than blind loyalty to only Delta. Let’s dive in.
Spending levels. They are going to drop. I expect:
- Diamond 35k down to 30k
- Platinum 18k down to 15k
- Gold 12k down to 10k
- Silver 6k down to 5k
I do not see Delta returning to anything but spend needed for status. They have gone all-in on only money counts as your loyalty to them and we should all remember the end goal is still to reach what they have already announced. Are these numbers low enough to matter? To some yes but for a bunch of folks reaching the current $20,000 in Delta spend per year is a number way too high (btw that is the point and what Delta wants). Thus a bunch more folks will have to get used to the new norm of being a mid-tier elite at Gold or Platinum.
Delta credit card earnings: They are also going to be more rewarding. I expect:
- Reserve card 10:1 MQDs up to 8:1 MQDs
- Platinum card 20:1 up to 16:1 MQDs
This brings the yearly card spend on a Reserve card back down to near what it was, that is, the better part of a quarter million. Still a ridiculous amount of spend on a card that earns you Delta SkyPennies but way better than a third of million.
Sky Club access. You are going to get a few more visits. I expect:
- Reserve card 10x up to 16x
- Non Delta Amex Platinum cards 6x up to 10x
Clearly a move from unlimited access to giving you a punch card of limited visits still stinks but this will still have a big impact on the thinking of travelers. They will not burn a visit for say a 30 minute sojourn – thus the crowds in the club will shrink but maybe enough for most to still see value in a $550 or $695 per year card fee.
The bigger question is will any of these changes to the announced goals for Delta make any real difference to those who have already bolted from the pen and have now matched and are flying other airlines or to those who have taken a wait and see attitude and now know what they face in 2025? Here is what I think:
Those who have bolted and are happy with the choice will say “see I made the right call“! They will say the rollbacks are not enough (I think they are right). Some on the fence will say, like the bolters, this is still hugely insulting and I am done while others will say I can live with this if they don’t make it worse the following year.
As for the Reserve credit card changes, if you only count the card cost as club access, you are paying just under $35 per visit. That is in line (or slightly lower) with what Delta has historically charged so in their minds is workable. For Platinum card holders you are paying $70 per visit but the card clearly yields so many other perks that club access only is not the point.
So there you are. The above is what I expect Delta will try to sell us on as a workable solution that everyone can live with. Do you agree? – René
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