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Some air miles can’t be used ahead of expiration

Nov 23,2018
Yoon Min-joo needs to use her 30,000 frequent flier miles before they expire at the end of the year. The 47-year-old, however, can’t seem to find a way to redeem them.

“I’ve looked for round-trip flights from Incheon to Tokyo to spend my 30,000 miles, but haven’t been able to find a single seat,” said Yoon.

Many Koreans face a similar situation as some flier miles from Korea’s top two airlines - Korean Air and Asiana Airlines - are soon set to expire. The two companies changed their user-service agreements back in 2008 and set a 10-year expiration period on miles, so fliers are now scurrying to use unspent miles before Dec. 31.

Although the expiration deadline is a well-known fact, usage rates for flier miles remain relatively low. Korean Air said around 20 percent of flier miles set to expire this year have not yet been utilized, similar to the amount that was left back in July. Asiana refused to disclose the information, claiming it be a trade secret, but did say that the amount of leftover miles has not changed much since July.

The problem with frequent-flier miles in Korea is that they come with numerous limitations. While fliers try to spend miles by booking tickets, local airlines limit the portion of mileage seats to 3 percent of total seats on a flight.

“Even planes that are empty don’t have mileage seats, so there were times where I had to pay cash for a seat,” said Kim Yong-seok, a 50-year-old flier.

Other mileage-related products offered by the top two airlines are also not consumer friendly.

The Asiana Airlines “Weekly Hot Deal” featured on its homepage offers Domino’s Pizza coupons worth 18,700 won ($16.58) in exchange for 2,600 miles, roughly 7 won per flier mile. This is about one third of the 20 won per mile paid by credit card companies to airlines.

While Asiana is increasing the number of partnerships for mile usage, signing on large retailer E-mart and amusement park Everland, Korean Air limits its miles to products provided by companies under the Hanjin Group, its parent.

Korean Air hasn’t made any changes other than adding more toy model airplanes to its mileage products.

Korean Air, however, said mileage usage is increasing.

“After actively encouraging customers this year to use their miles, the rate of flight reservations made with airline miles has increased 30 percent from last year,” said an official at Korean Air.

The top two airlines aren’t disclosing the exact number of miles that are set to expire this year. But Korean Air’s mileage-related debt on its financial statement is 2.16 trillion won, while Asiana reported the figure at around 575.1 billion.

After consumer complaints, the Fair Trade Commission (FTC) said it would look into a solution but has yet to mandate a fix to the limitations on airline miles.

JoongAng Ilbo researched the frequent-flier mileage policies of 10 major airlines globally, including Singapore Airlines, and found that all airlines, except those in Korea and Japan, allow miles to be purchased or gifted. Some airlines had partnered with over 4,000 locations for the use of miles.


BY HAM JONG-SUN [chae.yunhwan@joongang.co.kr]


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