(comment) ...If I had Charlse's DL FF points, I would be burning miles on SQ to BKK for shure.....But then again, Charle's International ventures don't even get him to Calle Ocho in MIA. Bryant Petitt Cumming, GA Atlanta Journal-Constitution]] Peralte C. Paul - Staff Tuesday, October 12, 2004 In his quest to rack up frequent flier miles, Chris Schroder has become a take-charge kind of guy. He'll charge as much as possible on his credit cards: groceries, morning coffee, his kids' college tuition, even quarterly tax payments to Uncle Sam. The 47-year-old Atlanta marketing consultant has earned about 400,000 air travel miles on his platinum American Express Delta SkyMiles card during the last four years and about 65,000 miles on a US Airways-branded Visa account he opened last year. But as airlines struggle to stay financially solvent, Schroder wonders if his loyalty ought to remain tied to the fortunes of one or two carriers. He's now considering getting a credit card that allows him to collect miles on any airline. "Before, you just racked up [miles] and held them like a bank account," he said. "You gained all these points, and now you have to worry if all that work was for nothing." There's reason for concern. Frequent fliers who have stuck with one airline to earn miles could find the benefit unusable if the carrier fizzles into liquidation. In past airline business failures, frequent fliers came out relatively unscathed. Delta honored Pan Am frequent flier miles when that airline became defunct. Continental did the same with Eastern Airlines. But with so many of the large airlines that offer miles-based credit cards in trouble, analysts say consumers may not fare as well these days. US Airways, the nation's seventh-largest airline, filed for bankruptcy protection last month. The move, its second trip into Chapter 11 in as many years, has stoked speculation that the airline could have to liquidate by selling off its assets. United Airlines, the nation's No. 2 carrier, has been operating under bankruptcy protection since December 2002. Now Atlanta-based Delta Air Lines, the third-largest carrier, is teetering on bankruptcy. "It's a new world," said Kevin Mitchell of the Business Travel Coalition, a travelers advocacy group. "If you're someone with 100,000 or 200,000 points, I'd go about life until I see danger signals," Mitchell advised frequent fliers. "If you have 1 million points, I'd start drawing it down and hedging my bets, even with Delta." 'A real bummer' Schroder, who is getting married next year, has started exercising caution. He traded in some of his Delta miles for round-trip tickets to Hawaii for his honeymoon. He hopes Delta stays in business so he can use them. "Neither of us have been to Hawaii or in first class before," he said. "That's going to be a real bummer if it doesn't work out." Such fears, plus other changes in credit card air miles programs, have some travelers thinking about ditching airline-branded cards altogether. Several major issuers of airline cards, including J.P. Morgan Chase, Citibank and Bank of America, offer generic air miles cards, often with low annual fees or no fee at all. Chase, for example, offers a Continental Airlines-branded MasterCard for $65 a year. But Chase's own Travel Rewards is fee-free and gives the holder the flexibility to redeem miles on more than 250 airlines, including Continental. For consumers who tend to carry credit balances or don't charge a lot, a card with a high fee probably doesn't make sense, says Greg McBride, an analyst at Bankrate.com, a consumer finance Web site. Most frequent flier programs require 20,000 or 25,000 miles for a free ticket. So for a cardholder who earns less than 10,000 miles on a card that costs $85 a year, that "free" ticket costs $225. Generic cards on rise Nonairline cards awarding travel miles, which started up six years ago, are growing at a faster rate than airline-branded cards, said David Robertson, publisher of the Nilson Report, which tracks the credit card industry. There are about 14 million airline-branded cards in circulation --- twice the number of plain travel cards. But Robertson expects the nonbranded cards to catch up within two years. Part of the appeal, he said, is that generic cards are offering tempting deals such as no blackout dates, a major complaint about single-airline credit cards. Plus, airfares have become so cheap it's not as alluring for frequent fliers to stick with one carrier. Oscar Alban, an executive at Roswell-based software firm Witness Systems, has 750,000 miles in his Delta SkyMiles account, much of it earned through credit card charges. But he says he may cancel his $135-a-year SkyMiles card because these days he buys tickets on price, not loyalty. "It's almost like the airlines have become a commodity," Alban said. "You look for the best price --- there's not a whole lot to differentiate one from the other." Despite industry troubles and credit card competitors, analysts say the airline-branded cards, which began circulating in 1987, won't disappear. Airline cards still viable Indeed, airline cards account for more than $200 billion --- or 13 percent --- of the $1.5 trillion in annual credit card transactions in the United States, according to First Annapolis Consulting, a Maryland-based financial services advisory firm. New ones still are hitting the market. For example, AirTran Airways launched its A-Plus Visa card with Juniper Bank in November, and the airline says more than 50,000 cards have been issued. "It's customer segmentation," said Frank Martien, a First Annapolis analyst. Banks want customers who use their cards often, and the airlines want to capture and grow customer loyalty, he said. Airline executives say their cards give perks not always found with plain-vanilla travel cards. They promote alliances that allow customers to redeem miles on partner airlines. "It allows us to directly communicate with our customers about special offers, reduced mileage awards, special events not available elsewhere and other things only available to our credit card customers," said Jeff Zidell, vice president of marketing for American Airlines' AAdvantage program. But Charles Driebe, an Atlanta entertainment attorney who has banked more than 400,000 miles on his Delta SkyMiles Amex, is considering changing to a card that offers miles on any airline. "If you stick with one . . . credit card that accumulates miles good only for one carrier, that doesn't make sense anymore because you're putting all your eggs in one basket," he said. AIRLINES-AFFILIATED CARDS A comparison of select airline-branded travel cards: Card: AirTran Airways A-Plus Issuer: Juniper Variable Interest Rate*: 14.99% Annual Fee: $39 Card: American Airlines AAdvantage World Issuer: Citibank Variable Interest Rate*: 14.74% Annual Fee: $85 Card: Continental Airlines Platinum Issuer: Chase Manhattan** Variable Interest Rate*: 14.49% Annual Fee: $65 Card: Delta Air Lines SkyMiles Platinum Issuer: American Express Variable Interest Rate*: 14.74% Annual Fee: $135 Card: Southwest Airlines Rapid Rewards Issuer: Bank One** Variable Interest Rate*: 13.15% Annual Fee: $59 Card: United Airlines Mileage Plus Issuer: Bank One Variable Interest Rate*: 14.49% Annual Fee: $60 Card: US Airways Signature Issuer: Bank of America Variable Interest Rate*: 14.49% Annual Fee: $90 *Some cards offer lower introductory rates. **Chase and Bank One merged operations July 1. Sources: Bankrate.com and staff research PROGRAM BENEFITS > AirTran Every $1 in purchases on AirTran Airways gets two points; $1 in all other purchases earns one point; 1,000 points equals one flight credit; 12 flight credits gets a free ticket. > American Each $1 spent equals 1 mile up to 100,000 miles on purchases each year. No blackout dates on American Airlines, American Eagle and AmericanConnection carriers award travel. Miles don't expire as long as you continue to earn or redeem them with a program participant. > Continenta l Earn 11 miles for every $1 spent at certain restaurants; double miles per $1 spent at select retailers or one mile for each $1 spent at other establishments. No mile expiration. No yearly limit on mile accumulation. > Delta Earn one mile for every $1 spent on eligible purchases; double miles on purchases at supermarkets, drugstores, gas stations and home improvement stores. > Southwest Earn one Reward Dollar for every $1 in purchases; 1,000 Reward Dollars equal one Rapid Rewards credit. Sixteen Rewards credits equals a free round-trip ticket valid for 12 months. > United Earn one mile for every $1 spent in purchases; up to 11 miles for every $1 spent at participating restaurants nationwide. Earned miles expire after 36 months if there is no account activity. > US Airways Earn unlimited miles --- one mile per $1 on eligible purchases. Double miles on US Airways purchases and 11 miles per $1 spent at select restaurants. __________________________________________________ Do You Yahoo!? Tired of spam? Yahoo! Mail has the best spam protection around http://mail.yahoo.com