Frequent Flyer Mile Arbitrage: A Reader Success Story
Not all award charts are created equal.
The same flight in the same class on the same airline can cost wildly different amounts to book depending on which airline’s miles you are using to book the award. I call this “Frequent Flyer Mile Arbitrage” and I talk about it in depth in the MilesTalk Book near the end of “Chapter 5: Airline Miles and Alliances: How They Work and How to Work Them.”
Here’s an excerpt from Chapter 5:
As mentioned in the Travel Goals example in Chapter 4, we can use our miles to book award travel, not just with the airline with which we have our miles, but also with any of their alliance partners or other partner airlines. So, for example, United, Lufthansa, and Singapore Airlines are all in the Star Alliance. If I have United miles, I can redeem for any of these three airlines, as well as any other Star Alliance airlines. I’ll be using the United Airlines award chart to determine how many miles a particular route will cost, and then either use the United website, or call United directly, to check availability and book the flight.
This applies equally if I have my stash of miles on Singapore Airlines or Avianca or Air Canada. Often, the award price of the same flight on the same airline costs very different amounts of miles based on what program’s miles you book it with.
For example, if you want to book a Lufthansa 1st class award from the US to Europe right now it would cost you 110,000 United miles or just 80,000 Singapore Airlines miles. If you have miles in both programs, or can transfer to both programs from transferable currency, you can take advantage of this. I call this “frequent flyer mile arbitrage.”
I thought it would be fun to show how a MilesTalk reader, Rotem, put this into practice to save over $1,500 worth of points.
He was going to spend 85,000 UA miles each way for two people to TLV in Business on partner airline Turkish Airlines. That would have been 340,000 miles. He was transferring those miles to United from Chase Ultimate Rewards. I let him know that using Singapore Airlines KrisFlyer miles, those same flights would be 57,500 miles each way, or just 230,000 total for two passengers. And His Chase points transfer just as easily to Singapore as to United. Just like that, he saved 110,000 Chase Ultimate Rewards points which are worth, at a minimum, 1.5 cents each – $1,650 saved in the blink of an eye.
As an aside, this is also why I offer one-on-one miles and points consulting (as well as points consulting for businesses). While all the information anyone could ever need is online, sometimes you need a one-on-one to learn some new tricks or have the right questions asked that you might not think to ask or research yourself.
Frequent flyer mile arbitrage is the perfect example of a technique hiding in plain sight that most people would never think to research but could come up in a consulting session. Think of it as concierge medicine for miles and points. You don’t *need* it, but it’s nice to have available.
If you just have a question (i.e. you know what you want to ask) that’s always free on the private Facebook group, on Twitter, in post comments – and, when I’m online there’s even a free Live Chat right here.
PS: if you haven’t read my book yet, why not? 🙂