4 ms·

This isn't unusual - maybe the quantum is (though I have no idea if "$7.6B worth of travel" is large or small in whatever context the article is trying to make)

This isn't unusual - maybe the quantum is (though I have no idea if "$7.6B worth of travel" is large or small in whatever context the article is trying to make), but airmiles are awarded now with the expectation that the airline must fulfill them later. Maybe 30k miles gets you a 1 way trip now, normally valued at $200. In the future, they could devalue the miles and a 1 way trip costs 35k miles. Either way, they must be accounted for so yes it's normal to see this on a balance sheet. Is it alarming if you're an investor? Perhaps only if you think there will be a "run on miles" where nobody buys tickets suddenly and they all use miles to fly instead. But the airline will never allow that, plus these are all magic tokens any way, so not sure what the relevance of this in the article is.

nikanj 5y ago
A run on the miles is easily stopped by a simple ”I’m sorry sir, but currently there are no award-redemption eligible seats available for those dates”
- forgingahead 5y ago
  Exactly right - 2 years of pandemic and I had completely forgotten that this was a thing!
smegma2 5y ago
Yeah, you could just as well say "the world owes Warren Buffett 100B in goods and services". Yes, Delta owes it in a sense but it's really just a statement of how many outstanding points there are.
reincarnate0x14 5y ago
They already limit the number of point-only seat sales and upgrades on most flights, my various United point schemes will get me "upgrade waitlisted" on flights with 20 empty seats left in first/business until sometimes the day of departure as they try to get cash payments instead. Maybe it's better if you're in the magical invite-only programs but even at 1K, their top regular-people loyalty tier (which is something like 15000 USD in flights each year) it's gotten pretty bad. How many point-only seats they'll sell seems more variable but I've seen the rates jump from like 35k miles to 75k miles for the same seats for no apparent reason on flights.

nikanj 5y ago

A run on the miles is easily stopped by a simple ”I’m sorry sir, but currently there are no award-redemption eligible seats available for those dates”

forgingahead 5y ago
Exactly right - 2 years of pandemic and I had completely forgotten that this was a thing!

smegma2 5y ago

Yeah, you could just as well say "the world owes Warren Buffett 100B in goods and services". Yes, Delta owes it in a sense but it's really just a statement of how many outstanding points there are.

reincarnate0x14 5y ago

They already limit the number of point-only seat sales and upgrades on most flights, my various United point schemes will get me "upgrade waitlisted" on flights with 20 empty seats left in first/business until sometimes the day of departure as they try to get cash payments instead. Maybe it's better if you're in the magical invite-only programs but even at 1K, their top regular-people loyalty tier (which is something like 15000 USD in flights each year) it's gotten pretty bad. How many point-only seats they'll sell seems more variable but I've seen the rates jump from like 35k miles to 75k miles for the same seats for no apparent reason on flights.