AmEx tries to win over grumpy Delta customers with revamped SkyMiles credit cards

Hey there, time traveller!
This article was published 01/02/2024 (974 days ago), so information in it may no longer be current.

NEW YORK (AP) — American Express rolled out several updates to its Delta SkyMiles credit cards Thursday that will give additional benefits to users, part of efforts to soothe sore Delta Air Lines customers who have considered abandoning the airline after last year’s SkyMiles loyalty fiasco.

The updates, however, will come with a higher annual fee, which AmEx says it believes the new benefits will more than pay for.

New York-based AmEx is adding $200 flight credits to the cards after a certain amount of spending, $120 to $240 in restaurant credits at restaurants booked with Resy, as well as $120 to $240 in credits to use on rideshare apps like Lyft and Uber. Higher-end cards will also get $2,500 in “medallion qualifying dollars” that will get users closer to reaching elite status on the airline.

Additionally, Delta cardholders will now be able to use companion certificates on a broader array of flights, including to Hawaii, Alaska, Mexico, the Caribbean and Central America, instead of just the continental U.S. There had been complaints that Delta was overly restrictive on the use of these certificates in the past.

Atlanta-based Delta Air Lines and AmEx have had deep corporate ties going back decades, and it’s been lucrative for both companies. AmEx customers get access to Delta’s airport lounges and are able to transfer their Membership Rewards points to Delta, among other benefits.

In exchange, Delta got $6.8 billion from American Express in 2023 as part of its co-brand credit card partnership. The money comes from the fees AmEx collects from the billions of dollars spend on the cards by cardmembers.

To give a sense of scale, Delta CEO Ed Bastian told investors in June that roughly 1% of the entire U.S. economy is spend on Delta’s credit cards.

So, when Delta made alterations to its SkyMiles loyalty program last year, it was largely seen by Delta customers as a watering down of its program. Part of those changes required Delta customers to spend large sums of money on airfare or on the Delta credit card to be given elite status on the airline. Delta was also going to restrict the number of entries a customer could get into their lounges based on status.

Shortly after the announcement, message boards were often full of AmEx customers saying they were ready to cancel their cards due to Delta’s changes.

Bastian later apologized for the changes and Delta rolled back some of the proposed changes or delayed them for another year.

AmEx typically works on refreshing its credit cards with a lead time of 18 to 24 months, so the changes announced Thursday were in the works before Delta made changes to its SkyMiles program. But the changes come at a time when both companies want to make sure those who exclaimed “Done with Delta” on social media after last year’s SkyMiles changes remain in the fold.

“These cards offer a host of new benefits to help consumers and business owners get closer to Medallion status, access new credits and more value, and enjoy a premium travel experience,” said Howard Grosfield, president of U.S. Consumer Services at AmEx.

With the new benefits come with a higher annual fee. The Delta Gold Card will have a $150 annual fee, up from $99, while the Delta Platinum will be $350, up from $250, and the high-end Delta Reserve will have a $650 annual fee, up from $550.

___

This story has corrected the last name of Delta CEO to Ed Bastian, not Bastion.