It’s Not You, It’s Me: The Air Canada-Aeroplan Breakup and How It Affects Aeroplan Members
Ironically it was Air Canada that actually created the Aeroplan program in 1984 in an effort to grow its base of frequent flyers. Initially begun as a flight-oriented rewards program, Aeroplan evolved into a massive rewards behemoth with more than 75 partners representing over 150 different brands, spanning the spectrum of travel, retail and financial industries. In 2005 Aeroplan became publicly tradeable, eventually evolving into ‘Aimia’ and becoming completely independent from Air Canada.
Notable Aeroplan partners include 27 airlines from the Star Alliance network, as well as retailers like Gap, Esso, Chapters, Home Hardware and more. Aeroplan also has partnerships with credit cards, such as TD Bank, CIBC and American Express, that allow cardmembers to gain additional rewards points for purchases. Aeroplan’s affiliation with Star Alliance and the multi-faceted (and continuously expanding) accrual and redemption options played a large part in the program’s success and steady growth, such that today it now has over 5 million members.
Unfortunately for Aimia, Aeroplan’s market share is a major part of its success, which is why the corporation’s stock fell more than 60 percent after the dissolution of its partnership with Air Canada was announced. It should come as no surprise then that Aimia seems the more eager of the two parties to reconcile their differences and salvage the relationship. GreedyRates spoke with Christa Poole, Aimia’s Senior Manager of External Communications, who said, “We continue to believe that a new deal with Air Canada is still the best option for our five million members of Aeroplan, as this has been a very successful partnership over the years for our members, pairing one of the best global airlines with one of the world’s leading loyalty providers.”
As to Air Canada’s side of the story, in a classic it’s-not-you-it’s-me move, the Canadian air travel giant has avoided making a statement about any concrete issues it took with Aimia’s running of Aeroplan. Rather, Air Canada indicated that it wishes to widen the reach of its rewards program and take on an even larger share of the loyalty rewards market. Air Canada says that the new rewards program (which has yet to be named) “…will offer additional earning and redemption opportunities, more personalized service and a better digital experience for Air Canada customers.”
What Does the Split Mean for Aeroplan Members?
According to both Air Canada and Aimia, the Aeroplan-Air Canada partnership will continue to operate as normal until June 2020. Furthermore, Air Canada notes that Aeroplan miles accrued before June 2020 will be redeemable for Air Canada flights after the breakup date, though the miles themselves will not be transferable to Air Canada’s newfangled rewards program.
For its part, Aimia is dealing with the split by emphasizing Aeroplan’s non-flight related rewards, like retail and hotel partners. “In addition to flights, Aeroplan members redeemed more than 700,000 non-air rewards last year, through more than 1,000 specialty, merchandise, hotel, car rental and experiential rewards. Since launching the merchandise, hotel, car rental and experiential rewards in 2004, more than 144 billion Aeroplan Miles have been redeemed for non-air rewards.” Aimia also noted in an email to members that, “We know how much you care about this program, and we’re working to secure great new redemption options for you after June 2020.”
Some of our whip-smart and slightly sarcastic GreedyRates readers emailed us noting the irony of Aeroplan’s name in light of the Air Canada breakup. When asked if Aeroplan is considering a rebranding, Poole responded with a one-word, “No.”
Should You Stay or Should You Go?
Until the dust settles and Air Canada’s new rewards program is more fully fleshed out, it’s difficult to know whether it will be worth staying with Aeroplan. Certainly, if you’re not a frequent flyer and find that you often redeem your Aeroplan points for things like hotels, rental cars and merchandise, you may well decide to stick with Aeroplan.
If, however, you’re an avid traveler and always redeemed your Aeroplan miles for free flights, it might be a good idea to start investigating new rewards programs now rather than wait to see how Aeroplan will adapt and what Air Canada will eventually offer. Here’s a brief overview of some frequent flyer-friendly cards that are worth considering.
Scotiabank Gold American Express
This is one of our favorite travel rewards cards as it has the most generous reward categories in Canada. Cardholders earn 4x Scotia Rewards points for every $1 spent on gas, groceries, dining and entertainment. You earn 1x points on all other purchases. Presently the card is offering a generous sign-up bonus of 30,000 points (worth $300), with no annual fee in the first year when you spend $750 in the first three months. There’s also a bevy of other travel-oriented perks like airport lounge access, travel insurance and concierge service. Click here for the full review
American Express Gold Rewards Card
This card is one of Canada’s unsung reward-earning heroes. It offers new cardmembers a bonus of 25,000 Membership Rewards when you charge $1,500 in your first 3 months. You’ll also earn 2x points for every $1 in eligible purchases. It offers awesome flexibility with the ability to transfer your points to other frequent flyer programs like Aeroplan or Avios. The card is also waiving its annual $150 fee for the first year. Click here for the full review
*American Express is not responsible for maintaining or monitoring the accuracy of information on this website. For full details and current product information click the Apply link.
Rogers Platinum Mastercard
Even if you’re not a Rogers customer, this card packs a lot of punch with the country’s best cashback rate of 1.75% in all categories. Not only is Rogers waiving the fee in the first year, but it’s also offering a cashback bonus of $25 when you make your first purchase within the first 90 days. All that cash back could add up to a nice bundle for an upcoming vacation, and frequent travelers will really appreciate the 4% cash back you receive on purchases made in foreign currency. Click here for the full review
CIBC Aventura Visa Infinite
Enjoy a welcome package of 15,000 bonus points (worth $300) when you make your first purchase. You’ll earn 2 points per $1 when you purchase travel through the CIBC Rewards Centre portal and 1.5 points for every $1 you spend on gas, groceries and at drug stores. All other purchases earn you 1 point per dollar. You can use your points to book travel on any airline with no blackout dates. The annual $150 fee is waived in the first year.
Last but definitely not least – The WestJet RBC World Elite Mastercard
Another favorite among globetrotters is the WestJet RBC World Elite Mastercard. Signing up currently earns 250 WestJet dollars, with no minimum spending requirement. The card earns 2% in WestJet dollars when used to buy WestJet flights or WestJet Vacations packages, and earns 1.5% in WestJet dollars for all other purchases. For the annual fee of $99, you also get your first checked bag at no cost. Where this card really shines is if you have friends or family who love to travel, as cardholders receive an annual companion voucher to wherever WestJet flies. Click here for the full review
Whether or not you decide to look for a new rewards program, it’s certain that in the meantime, much like parents competing for a child’s affections after a divorce, Aimia will work hard to retain members’ loyalty with the promise of bigger and better rewards. As Poole notes, “What’s important for us is that our members will continue to be at the centre of our program. We know flight rewards are a member favorite. We’re committed to preserving a high value redemption proposition for Aeroplan members, including travel and flight rewards with industry leaders. We are hopeful for our members to be able to redeem for flight rewards on Air Canada and other airlines long past 2020 and we look forward to providing more details at the earliest possible time.”
About The Author
Sandra MacGregor has been writing about finance and travel for nearly a decade. Her work has appeared in a variety of publications like the New York Times, the UK Telegraph, the Washington Post, Forbes.com and the Toronto Star. She spends her free time travelling, and has lived around the globe, including in Paris, South Korea and Cape Town. You can follow her on Twitter at @MacgregorWrites