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4 Facts You Should Know About the American Airlines & US Airways Merger

Photo credit: Aero Icarus / Foter / CC BY-NC-SA

Photo credit: Aero Icarus / Foter / CC BY-NC-SA

This morning, American Airlines announced that it had officially merged with US Airways. If you’re freaking out about the fate of your newly acquired Dividend Miles, fear not. This proclamation means very little. Here are four simple facts to help you understand the current and future state of the American Airlines/US Airways Merger:

1. This isn’t really an official merger. While it’s touted as an “official merger,” both airlines and their respective award programs will continue to operate separately for some time.

2. You can earn and redeem with both programs. Currently, you can still use your AAdvantage and Dividend Miles for redemptions on One World and Star Alliance, respectively. This is excellent news, as the United devaluation that takes effect next year will make it pretty tough to redeem miles on premium cabins with Star Alliance partners. At least US Airways will still be around after the United MileagePlus massacre.

In January, we will be able to earn and redeem miles within both programs (meaning you can use your AA points to redeem US Air awards, vice versa). Not to mention, the two airlines will be extending reciprocal lounge access to members.

3. AAdvantage and Dividend Miles will merge in 2014. US Airways is set to leave the Star Alliance on March 30 and join One World on March 31, 2014. This is slightly off from the date I previously cited, but close enough. The great thing is that we can continue to earn and burn Dividend Miles with Star Alliance until then.

I’d definitely pick up a US Airways Dividend Miles Mastercard, which is rumored to convert to the Barclay Arrival Card So if you’ve thought about getting an Arrival card, do it before the two programs merge so that you don’t miss out on the 40,000 sign-up bonus. (Note I will earn a referral if you use my Arrival link – the US Air link is for the highest current offer on FlyerTalk).

4. Don’t hoard your miles, unless… I’m personally in the process of burning my US Airways Dividend Miles, so I won’t have many AAdvantage miles when the programs merge in late March. I recommend you do the same. After all, Star Alliance has a pretty extensive routing network, allowing you to go almost anywhere in the world – and with US Airways’ reasonable redemption rates, it’s a no-brainer to take advantage of this program while you still can. After all, you can still rack up AAdvantage miles from a slew of other credit cards. Plus, AAdvantage might devalue after the merger completes, so I wouldn’t hold off in the hopes of scoring a great AA/One World redemption. In any case, there’s still some time to figure out your strategy.

What are your thoughts on the merger? What do you plan on doing with your AAdvantage and Dividend Miles balance?

HT: Flyertalk

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Ariana Arghandewal

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