Annual fees for most Delta Air Lines-branded credit cards are rising dramatically, just months after the airline reversed controversial changes to its rewards program and made its popular Sky Clubs more exclusive.
The changes to the cards — the first since January 2020 — occurred on Wednesday night, with American Express announcing them on Thursday.
Kyle Potter, editor of Thrifty Traveler magazine, which was first to announce the fee increase, was surprised that the company would take such action so soon after the outcry over Delta's changes to its SkyMiles program that made it more difficult to earn status.
“All they do is get more money out of you,” Potter said. “They try to make you pay upfront and require you to swipe repeatedly on your Delta credit card.”
The annual fee for the lowest-tier Delta Gold Card has risen from $99, after a free initial introductory year, to $150. A Delta SkyMiles Platinum American Express flight used to cost $250 per year but is now $350. The annual fee for her backup card also jumped from $100 to $650.
Edina's Patrick Cole expects to lose Platinum status under the revised SkyMiles program – despite the company withdrawing from its original all-mileage qualifying total – and will now reconsider whether to keep his reserve card.
“My odds of staying with the higher-tier card are probably pretty low, but with the fees going up, I'm not sure it's worth getting any,” he said.
Delta and American Express appear willing to risk losing some cardholders because they have enough demand for the cards and status they open with the airline.
“That's what's happening here,” said Jay Sorensen, president of Milwaukee-based IdeaWorks, which specializes in frequent-flyer programs. “These are signs of a successful portfolio from a demand perspective.”
Revenue from branded credit cards now makes up about 10% of airline revenue in the U.S., and that number is continuing to grow.
“These programs are the difference between profit and loss,” Sorensen said.
But he sees risks ahead. His message to airlines: Don't forget that the frequent flyer program should ultimately be about selling more airline seats.
“Should the credit card be at the center of it? No, because I think you've lost sight of what a loyalty program is,” he said.
Last fall, Delta — the dominant carrier in Minneapolis-St. Paul International Airport – has debuted extensive requirements in its SkyMiles loyalty program for elite status and all its privileges. In just over a month, the airline imposed a blockade due to customer anger, admitted it “may have gone too far” and eventually scaled back planned modifications.
The plan, first announced in September, aims to limit the status solely to the amount of money travelers spend with the carrier or via their credit cards rather than miles flown. Delta also confirmed that it plans to limit access to its Sky Club lounges starting February 1, 2025 to premium cardholders only.
since then, Delta decreased Number of Medallion Qualifying Dollars (MQDs) required to achieve 2025 status, enhancing the Million Miler Long-Term Loyalty Reward Program, increasing access to Delta Sky Club for Business and Backup Business Card holders and enhancing options for renewable Medallion Qualification Miles. .
American Express spokeswoman Elizabeth Crosta said the company has planned the changes for two years and has also included additional perks such as ride-sharing, restaurant refunds and $2,500 annually in Silver Medallion-qualifying dollars, halfway to achieving that top-tier status.
“We're trying to create rewards that are meaningful and don't require cardholders to change their behavior,” she said.
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