What would you do with 14 million frequent flyer miles?

Following at attacks on September 11th, one thing airlines did to try and entice back customers was increase frequent flyer miles. These days you can get frequent flyer miles for just about everything. Signing up for a credit card, paying bills online, buying a can of tuna. Redeeming them tends to be slightly more difficult: you have to book flights long in advance and all kinds of restrictions and black outs apply. The fact is, most people don’t redeem their points.

Over the last 25 years airlines alone have given out more than 19 trillion airmiles. Of those miles, the majority of them, a total of 14 million miles, have not yet been redeemed. Many airlines are introducing new regulations which make these miles expire faster than they did before but the fact remains: a large number of miles are still out there threatening airlines.

In 2006, 7.5% of all passengers flying with American Airlines flew for free. For Delta Air Lines, it is estimated that 8 million trips were redeemed in 2006. If the trend continues, it could case paying passengers to lose their seats.

Rick Ferguson, editorial director at Colloquy, a loyalty-program consulting firm said, “The airlines just can’t handle that level of reward redemption.  The liability’s a big problem.”

www.aa.com