Air New Zealand slashes frequent flyer Airpoints earning rates in Economy

By John Walton, April 15 2011

Air New Zealand has made steep cuts to the amount of frequent flyer Airpoints earned when flying Economy, with the cheapest fares now earning less than half of previous rates on flights to North America and Western Australia.

Frequent flyers who accrue Airpoints dollars in Air New Zealand's loyalty programme will will be reassessing their options for "earning and burning" their points before the new rates come into effect as of 1 June.

Air New Zealand's Head of Loyalty, Simon Pomeroy, told members today: "The changes we are making to the earning rates will bring them more in line with the price of the fare paid."

"We will be offering a more dynamic approach that will see an increase in the Airpoints Dollars offered on higher priced economy, premium economy and business class fares on Air New Zealand operated flights and a reduction in Airpoints Dollars offered on lower priced economy fares," Pomeroy continued.

What are the changes?

In effect, the airline is splitting up its Economy fares into different subcategories. Category 1 -- the most expensive fares -- is the most lucrative and category 5 is the most stingy.

Previously, there were only two categories: Full Economy or Discount Economy.

Between NZ and Perth, Full Economy earned 70 Airpoints (A70), while Discount Economy earned A50. Now, the cheapest fares will earn A20, with other fares earning A25, A30, A55 and A70.

Between NZ and North America, Full Economy used to earn A115, with Discount Economy earning A80. Now, the categories are A30, A40, A50, A85 and A120.

Earning to Eastern Australia hasn't changed much. Only Categories 1 and 3 are used, which seem to correspond to the old Full Economy and Discount Economy rates: A30 in Discount Economy/Category 3 and A50 in Full Economy/Category 1.

Business Class and Premium Economy passengers to London and North America will be ever so slightly better off: earning rates have increased by A5.

Here's the full list of earning rates on Air New Zealand:

Airpoints members who accrue Airpoints dollars on Star Alliance and other airline partners Virgin Atlantic and Etihad have seen a sharp drop in their accrual rates in economy:

Drop from A25 to A20 between Australia and NZ
Drop from A85 to A45 between Australia and Europe
Drop from A45 to A20 between NZ and Asia
Drop from A40 to A25 between NZ and North America

Here's the full list of earning rates on Airline partners

What are your other options?

Many frequent travellers to New Zealand avoid Airpoints altogether and funnel their miles to Star Alliance partners with better "earning and burning" rates instead.

Japan's ANA and US Airways are popular insider choices: ANA for their relatively cheap redemption rates and US Airways because of frequent sales of miles and elite status.

What will you be doing as a result of these changes? Will you change programme, or stick it out with Airpoints? Leave a comment below and discuss your thoughts with us and our readers, or take the conversation to Twitter: @AusBT.

John Walton

Aviation journalist and travel columnist John took his first long-haul flight when he was eight weeks old and hasn't looked back since. Well, except when facing rearwards in business class.