I was gathering some information to update a post about redemption pricing with British Airways Executive Club vs. Iberia Plus when I realized that Iberia appears to have updated its redemption table for flights operated by American Airlines (as well as other partners).
Why does this matter?
The programs of British Airways and Iberia can be used to book flights operated by American Airlines. This is important because our two favorite currencies, Chase Ultimate Rewards points and American Express Membership Rewards points, do not transfer to AAdvantage. Amex MR and Chase UR do transfer to British Airways and Iberia, which provides an avenue for booking AA award flights without actually having to collect AAdvantage miles. You can read about how to book American Airlines flights with British Airways avios here.
The redemption pricing when redeeming British Airways and Iberia avios for flights operated by American Airlines is actually better than that of the AAdvantage program for most nonstop routes in economy. For some nonstop routes, business class seats also have better pricing when redeeming British Airways avios rather than AAdvantage miles. But the catch is that the route has to be nonstop because even a short connecting flight will add at least 6,000 avios each way to the redemption total.
Iberia had a different redemption table for flights operated by American Airlines, but also, the way Iberia calculated distance made it a viable option for booking some routes operated by AA when a connecting flight was involved.
As of sometime in the past week (May 2021), Iberia has quietly updated its chart for flights operated by American Airlines. It seems that Iberia has also updated their redemption tables for other Oneworld partners to match the new AA table. British Airways does not actually publish a redemption table for flights operated by AA and other partners, but the table below is thought to be their pricing model.
Note that the first zone (1-650 miles) is actually 7,500 avios, not 6,000 for flights within the US.
The new Iberia chart for American Airlines seems to be exactly in line with British Airways redemption pricing for flights operated by American Airlines
This is now the chart that can be found on Iberia’s website for flights operated by American Airlines.
Note: it appears that just like British Airways, the first zone (1-650 miles) is actually 7,500 avios, not 6,000 for flights within the US.
Judging by the language on the notes below the chart, it seems like Iberia will now calculate redemption totals the same way British Airways does, which is by adding the sum of each segment.
This doesn’t really change anything for us as we live in DFW, a major AA hub, but this is not good news if you live in a city that is not an AA hub.
Iberia was favorable to British Airways in some situations due to the way they calculated distance
What made Iberia sometimes favorable for those who do not live in a hub city is the way Iberia calculated the distance. Iberia calculated the total based on the total distance, not per segment like British Airways. This can make a huge difference because on an itinerary with a connection, if the connecting flight distance was short enough to not make the total distance fall into the next pricing tier, the itinerary could price the same as a nonstop itinerary.
This table below that is still on the Iberia site for Oneworld redemptions is the same (or at least very similar) to what the Iberia table was for flights operated by American Airlines.
AA flights could only be booked roundtrip when using Iberia avios, and the total distance was calculated to determine the redemption total. Now, it looks like Iberia avios can be used to book one way AA flights but at the new prices.
As for this oneworld chart, it is unclear what now constitutes a oneworld flight that would be subject to this table. It states “To Avios on flights of one or more oneworld companies, or IB flights combined with other oneworld carriers”, which to me seems like roundtrip flights operated by AA (“one or more oneworld companies”) would qualify for this pricing.
But I ran some searches for nonstop AA routes as well as a route with a connection, and the itineraries were in fact priced just like British Airways (and Iberia’s new chart for AA) and not like this oneworld table.
I’m guessing this table applies only when two oneworld airlines OR Iberia plus one other oneworld airline operates the itinerary.
Comparing old Iberia redemption pricing vs. new Iberia redemption pricing
I’m going to compare old and new pricing using 2 different itineraries to Destin/Ft. Walton (VPS). The first is a nonstop DFW to VPS. The second is Houston to VPS with a connection in Dallas. Here are the distances:
- DFW to Destin (VPS) is ~641 miles
- Houston (IAH) to DFW is ~225 miles.
New Iberia redemption pricing for flights operated by AA
Nonstop DFW-VPS is 15,000 Iberia Avios roundtrip in economy*. This is the same redemption price I would get by redeeming British Airways for the exact same AA itinerary.
*DFW to Destin (VPS) is 641 miles each way. According to Iberia’s new chart, flights between 1 and 651 miles in distance should be 6,000 avios. It is well known that British Airways actually prices AA operated flights within the US at 7,500 for this zone rather than 6,000. After pricing this itinerary on Iberia, it seems that Iberia is also pricing this zone at 7,500. More evidence that Iberia is aligning its redemption pricing with British Airways for AA flights.
Houston to VPS via DFW roundtrip is now 30,000 avios roundtrip. That is because the redemption price of each segment is added to determine the total:
- IAH-DFW (225 miles distance)-7,500 avios
- DFW-VPS (641 miles distance)-7,500 avios
- VPS-DFW (641 miles distance)-7,500 avios
- DFW-IAH (225 miles distance)-7,500 avios
Total roundtrip is now 30,000 Iberia Avios
This is exactly how British Airways calculates redemption prices.
Old Iberia redemption pricing for flights operated by AA
DFW-VPS roundtrip is 1282 miles in distance. That distance falls between 1001-2000, so this would have priced at 17,000 Iberia avios.
You can use the Oneworld chart above as a reference since those were the old redemption prices for AA when redeeming Iberia avios.
Houston to VPS with a connection in Dallas would have also priced at 17,000. This is how it was possible to book IAH-DFW-VPS roundtrip for just 17,000 avios:
- IAH-DFW (225 miles distance)
- DFW-VPS (641 miles distance)
- VPS-DFW (641 miles distance)
- DFW-IAH (225 miles distance)
Add the miles (225 + 641 + 641 +225). Total is 1732 which is still under 2000 total miles. So the redemption price was the same as the nonstop DFW-VPS, which was 17,000 Iberia avios.
The only difference between using British Airways vs. Iberia for flights operated by American Airlines seems to be taxes, fees, and surcharges/carrier fees
BA is notorious for ridiculous fuel surcharges on transatlantic routes, including those operated by American Airlines. But there are no fuel surcharges for most other AA routes, including long-haul journeys such as DFW-Tokyo.
Iberia also collects fuel surcharges, but on transatlantic routes, they’re sometimes more reasonable than BA. Iberia also seems to collect fuel surcharges or some sort of extra fee even on domestic AA itineraries, but they may or may not be a deal breaker.
It really just depends on the route and the carrier(s) operating the itinerary.
This is the same nonstop DFW-VPS roundtrip itinerary in economy operated by American Airlines and booked with British Airways that is mentioned above:
The total is 15,000 Avios (7,500 each way) plus $11.20.
With Iberia, I got the exact same redemption price of 15,000 avios, but the fees totaled $20.20. I was unable to see a fee breakdown so I’m not sure what the extra $8 is for. Seems too low to be fuel surcharge so I’m sure it’s some other type of carrier charge. Anyway, the difference is only $8, but you would probably want to book this with British Airways avios rather than Iberia avios.
Redeeming Iberia avios for a international AA flights
This is a nonstop DFW-SJD roundtrip itinerary in economy operated by American Airlines and booked with British Airways:
DFW to Cabo falls in the 651-1150 distance band which is 9,000 avios each way. The roundtrip total is 18,000 avios plus $106 in taxes and fees. Most of the $106 in fees is unavoidable and we will discuss that in a moment.
This is the total with Iberia for the exact same itinerary:
With Iberia, I got the exact same redemption price of 18,000 avios, but the fees totaled $148.88. Again, I was unable to see a fee breakdown so I’m not sure what Iberia is calling the extra ~$40, but it’s some type of carrier charge.
Quick lesson on fuel surcharges and taxes/fees
British Airways and Iberia collect fuel/carrier surcharges on transatlantic flights, including flights operated by AA. This is in addition to taxes and fees. Fuel surcharges/carrier surcharges are different than taxes and fees. You may be able to avoid fuel/carrier surcharges by choosing another airline, but you cannot avoid taxes and fees.
Regardless of the airline you use to book and/or the airline operating the flight, any time to you book an international award ticket, you’ll have to pay some taxes and fees. These are imposed by foreign governments and there is no way around them. For reference, taxes on domestic AA flights would cost only $5.60 each way since that is the only fee collected by the US for travel wholly within the US.
For international flights, the fees are set by foreign governments. Usually these fees total less than $100 and they aren’t a deal breaker, but there are a few airports known for high government taxes and fees. UK airports are notorious for high taxes and fees. So using British Airways to book flights to Europe results in high fuel surcharges plus potentially high taxes and fees (if the itinerary involves the UK), even if AA operates the flight. Iberia’s fuel surcharges on AA operated transatlantic flights are better than BA, but routing through the UK still comes with those steep taxes.
There are other Chase Ultimate Rewards and Amex Membership Rewards partners that are great for Europe. Click here for several great ways to book flights between the US and Europe.
Anyway, British Airways is usually a no-go for transatlantic flights, but it’s a great program for almost any other nonstop route (in economy at least). For some transatlantic routes, depending on the airline operating the flight, Iberia has reasonable fuel surcharges.
Redeeming Iberia avios for a transatlantic AA flights
So far, it seems like for domestic and some international itineraries, British Airways is a better way to book due to lower fees than Iberia. But transatlantic flights is where Iberia may still have a leg up on British Airways.
Fuel surcharges may make one program superior to the other when booking flights operated by AA
In the past, Iberia had better out of pocket costs for transatlantic AA flights traveling to/through/from Madrid than British Airways. That appears to still be the case.
Here is DFW-Madrid nonstop roundtrip in economy operated by American Airlines:
That $495 in fees is mostly fuel/carrier surcharges. Using Iberia Avios to book this exact same AA itinerary results in the same redemption price of 51,500 avios, but a much more reasonable total for out of pocket fees:
I’m going to end this here, but I’ll be posting more about this Iberia change and the implications later this week.
Iberia has updated its award chart and redemption pricing to match that of British Airways for American Airlines and for other partner flights. This is unfortunate as the old Iberia pricing for AA flights was a good alternative to booking AA flights when your itinerary has a connection. The only difference that may make British Airways or Iberia better than the other for any given flight is taxes/fees/fuel surcharges (when applicable).
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