One of the biggest problems when booking award travel is “phantom inventory.” This is inventory that shows up in an online search, but isn’t really there. When you go to book it, it won’t confirm. Certain airlines are notorious for displaying phantom inventory: TAP, Ethiopian and LOT to name a few. Typically, though, this problem only involves partner inventory (such as when using United Mileage Plus points to book a ticket on LOT). I have never–I mean, never–encountered this when booking flights on an airline through their own mileage program.
That is, until today. I was attempting to book a seat from Bangkok to New York. This is fairly straightforward. Singapore offers “Saver” and “Advantage” inventory, and the rule with them is that you have to find flights all the way through in the same inventory “bucket” in order for it to book as one fare. OK, that’s fine, no problem. Here’s a flight from Bangkok to Singapore:
And here’s another flight from Singapore to New York a few days later:
Easy, right? Singapore allows stopovers, so you can put the two together and it’ll book out at 143,500 points total. Make no mistake, this is an expensive award, but at least Singapore doesn’t have fuel surcharges when you’re booking flights that they operate.
Only one problem: I got all the way to the end, and was informed that I was added to the waitlist. Wait, what? Singapore does offer the option to waitlist flights in case they decide to open up award inventory, but in my experience, it’s pretty rare that these ever clear. And you generally won’t know until the last minute whether or not your request will clear. Waitlisting can be useful for speculative bookings if you have a lot of flexibility in your schedule, but this booking isn’t that. And I specifically picked flights which weren’t any sort of “waitlist” situation. They were clearly displayed as bookable.
OK, fine. I made a phone call to Singapore Airlines (this time, the call center was in The Philippines, an improvement vs. their horrible call center in India). Surprisingly, I got right through. Nope, the inventory wasn’t available. Nothing was available. Not a single business class seat was available on either a Sunday or Monday, nearly a year in the future, from Singapore to any location they serve in the United States. Typical. Given that I had screen shots and clearly the error was on Singapore’s end, I wasn’t really willing to take no for an answer. The agent had a way to collect my emailed screen shots and an escalation path of some sort, but for now, do not assume the Singapore Web site is reliable. If you’re booking anything with Singapore, do it over the phone. This is hard, because they won’t hold seats and points transfers are not immediate, although sometimes, Amex points transfers can show up quickly. It might be worth finding inventory with an agent, and seeing whether you can transfer points while you have them on the phone. Otherwise, you’re in for a nail-biting couple of days waiting for the points to post in your KrisFlyer account, and hoping the inventory you found is still there once they finally do.
If you’re a frequent traveler between the United States and Canada, you’re probably familiar with the NEXUS program. This trusted traveler program is similar to Global Entry, but it works on both sides of the border. Getting a NEXUS card isn’t easy. You need to pass rigorous background checks by both US and Canadian authorities, and pass an in-person interview with both US Customs and Border Protection and the CBSA. There are also strict rules governing the program; it’s hard to get these privileges, and it’s very easy to lose them.
At land crossings, there is a special NEXUS lane (by the way, never enter this lane if you are not a NEXUS card holder: you’ll automatically be sent to secondary inspection and will also likely be fined). When entering the US by air, you can use a Global Entry kiosk to clear immigration. When entering Canada, there is a NEXUS kiosk used to clear immigration. And for program members, there’s an additional bonus: NEXUS cards are a Western Hemisphere Travel Initiative (WHTI) compliant credential, meeting the equivalent requirements in Canada. This means that they are a perfectly valid and acceptable travel document for air travel between the United States and Canada–fully equivalent to carrying a passport.
When I’m flying from Vancouver (which I often do, because I live in between the Vancouver and Bellingham airports), I usually fly Canadian carriers who are aware of the procedures. However, yesterday I was flying Delta from Salt Lake City, who made up its own rules and denied me boarding unless I presented a passport. Fortunately, I was on a connecting flight from Mexico and I had my passport with me this time, but this isn’t always the case.
At boarding, the Delta gate agent ran facial recognition on me (something I absolutely hate, and which feels super creepy and invasive–I never signed up for this or gave them my photo), and then the gate agent asked for my passport. I handed her my NEXUS card. “Nope!” she said. “You have to give me a passport.” I explained that NEXUS is a valid credential for travel to Canada, and that a passport wasn’t necessary. “I’ll look it up but you’re wrong,” she said, “international flights always require a passport.” She then proceeded to look through her system, failed to find anything involving NEXUS, and called a “Red Coat” who–apparently without looking anything up–denied me boarding without a passport.
By now, the agent (who it turns out was a Canadian citizen) was apparently curious. I knew I was right, remained polite, and suggested that she call Delta’s Canadian partner WestJet to confirm the requirements. After some digging, she confirmed in a Delta system (last updated 5 days ago) that I was, in fact, right. However, because a “Red Coat” had determined I was required to show my passport, she required me to do so anyway. This is very typical of Delta; they don’t seem to give their employees much flexibility or encourage independent thinking.
It’s fairly routine for NEXUS card holders traveling between Canada and the US to carry only their NEXUS cards. After all, this is all that is required to cross the border! However, if you’re considering a ski vacation to Utah this winter, think again before flying Delta. If you don’t bring your passport–which is completely unnecessary–you might end up stranded until you rebook with a Canadian carrier who understands the rules and follows proper documentation procedures.
Look, I get it. I don’t blame the gate agent. You may not be aware of this, but gate agents can be personally liable for fines if they allow travelers without valid documents on board an aircraft. If they’re as strict with ID requirements as a 7-11 clerk selling cigarettes to someone who looks 16, this is why. This is entirely the fault of poor training at Delta, combined with software that makes it too difficult to verify which ID is required. In the meantime, carry your passport because it seems that Delta just makes up its own documentation requirements.
One of the best sweet spots on the American Airlines AAdvantage award chart is from Central Asia and the Indian Subcontinent to Southeast Asia. It costs only 40,000 AAdvantage miles in business class for this trip. This is a lot of flying: 5,630 miles in Qatar Airways Qsuites. 12 hours of luxury in the world’s best business class. Fancy champagne, luxurious lounges, all of that stuff. I mean, this is definitely not the usual Seat 31B style, but it’s only 15,000 points more than going in economy class! For as good a bargain as this (on a flight that would cost a cool $4,000 in business class or $1,500 in economy) it’s well worth the points. And what an incredible graduation gift to a friend who lives in Kazakhstan this would be, right?
The trick is booking it. If you search the American Airlines Web site, these flights simply don’t exist–even though Qatar Airways award flights normally appear on Web search results. For this itinerary, I needed very specific dates. I searched with other Qatar Airways partners, saw availability for the outbound in economy class with business class on the return, and called American Airlines to see whether I could book it. This resulted in a 3 day adventure that finally ended with tickets issued, but could have been an absolute nightmare scenario.
When I initially called to book the itinerary, the agent didn’t seem very experienced. She located availability, but then somehow released it back to Qatar Airways, who instantly removed it from inventory. This happens sometimes when you’re working with an agent over the phone; if they don’t know how to correctly work with inventory during the booking process, it might be released back to the partner airline (who may or may not put it back into inventory). Naturally, the flight I wanted was no longer available because of the agent’s error, so I ended up having to book an evening return (rather than the morning) and the whole thing was in economy class, rather than a return in business class. It wouldn’t be the end of the world, but wasn’t what I was hoping for.
OK, fine. Challenge accepted. I have dealt with this sort of problem before. If you wait overnight, sometimes the inventory pops back up again, so I checked again in the morning. Success! Not only was the flight I wanted available, but business class was available, too. All I’d need to do was get American to make the change, but no big deal, right? Changes are free. It’s a relatively simple exercise, just changing the time of day and class of service. Two flights swapped, nothing more. What could possibly go wrong?
After 90 minutes of calling American, getting routed by the dumb automated phone robot to the wrong department (domestic revenue tickets instead of international AAdvantage, even though I provided my confirmation code), and then finally being transferred to the right department, I had someone on the line who could make the change. She understood what I was after, updated my booking, got me the class of service I wanted, and told me that it’d be an even exchange for the tickets because the taxes were the same.
Perfect. Sounds good. No problem. I received an email confirming the changes, my card was charged the correct amount for the taxes, my AAdvantage account was charged the additional 15,000 miles for the upgraded segment (in a goofy roundabout way involving charging me 115,000 miles and then refunding 50,000 miles, but it added up to the right amount), so good to go. Right?
Here’s the thing. When I logged on to aa.com, the ticketing status showed “On Request.” That’s fairly normal, because American issues award tickets manually. But I also got a pop-up at the top of the screen saying that I needed to call and contact an agent for ticketing. That is not normal. If you see that, it usually means the payment didn’t go through. And if your payment doesn’t clear, American will cancel your reservation 24 hours later. They do so without mercy or regret and when a Qsuites award is at stake, someone else will likely snap it up before you get the problem sorted out.
So, I made my third call to American. Another 90 minutes on hold. The agent I spoke to said “No, there’s no problem, you are in queue for a refund.” Wait, what?! Evidently the previous agent didn’t really know what they were doing. And my ticket was so messed up that the agent I was speaking with didn’t know how to fix it. It was going to require action from the “Resolution Desk” and the “Partner Desk,” according to her supervisor, and those were only open between 6am and 5:30pm Central time. “Will my reservation be cancelled in the interim?” I asked. “No, you should be safe as long as the resolution desk fixes this tomorrow, because this is in a ticketing queue.”
OK, fine. Another call to American the following day. Only an hour on hold this time. The first agent insisted on trying to help me when I explained it was an international AAdvantage ticket, and then after several minutes of typing and looking at my reservation, said “oh, this is an international AAdvantage ticket” and blind transferred me to the right department. I immediately asked for the “Resolution Desk,” which got me transferred to a supervisor. Apparently supervisors now perform this function, even though it used to be a dedicated desk.
This particular supervisor was friendly, and seemed to have some experience at the airline. That’s difficult to find these days; airlines laid off so many people during the pandemic that finding anyone with the institutional knowledge to solve problems can sometimes be difficult. However, she was stumped. “Oh my goodness, I’m not sure what to do here!” She put me on hold for a few minutes while she came up with a strategy.
Ultimately, the solution was to refund the existing itinerary, move all of the reservations into a separate PNR (with a new confirmation code), and then charge me again. Sure, no problem. This was a lot of manual data entry in airline computers, but the supervisor got it all done. The next two stops were the “Liaison Desk” and the “Ticketing Desk,” both of whose action was needed to actually get the ticket issued. 45 minutes or so later, and success! “OK, your ticket is issued and ready to go. Just go ahead and look at it in your AAdvantage profile.”
“Wait a minute,” I said. “It won’t show up there, because the ticket isn’t in my name.”
“Oh. Um, right. You see, I, uh… issued the ticket in your name, not your friend’s name. Oops!“
Now, I wasn’t upset. Everybody makes mistakes. At least we caught it before I got off the call, so I didn’t need to call in again. No big deal, easy to fix, right? Just change the name? Nope. Airline computers aren’t set up that way. Instead, fixing the problem required refunding everything again, charging everything again, building out another PNR with the correct name, moving the reservation into it, calling the Liaison Desk again, calling the Ticketing Desk again, and finally a ticket was issued in the correct name.
Finally. Five long phone calls and several hours later. With no warning at all that anything was even remotely wrong except for an obscure pop-up on the Web site, which almost anyone would have overlooked. After all, American Airlines issued me a “Trip Confirmation and Receipt,” charged my card, deducted mileage, issued a confirmation code, and I could even pick out seats and meals!
However, no AAdvantage redemption certificate was issued. It wasn’t attached to the ticket because there was no ticket. In fact, nothing was attached to the reservation. If I hadn’t sorted this out, it would have been a mad scramble at the airport on the day of travel. As far as Qatar would be concerned, they’d never have been paid, and there was a reservation with no ticket, so they wouldn’t owe any transportation. And it’d require calling American Airlines to fix the problem, because they issued the ticket. Good luck getting that sorted out, over crappy airport WiFi, 3 hours prior to departure.
What can you do? Always make sure that a ticket number is issued, visible, and attached to your reservation. You’re looking for the following:
Confirmation code, both for the airline you’re booking with and the airline operating the flight
Ticket number (For example, this will start with 001 if American issued the ticket, or with 006 if Delta issued the ticket)
Your card was charged for the full amount of taxes and fees
The mileage was deducted for your ticket, and it’s the correct number of miles
If all of the above has not taken place, then there could be something wrong with your ticket. Call and ask and if the agent doesn’t seem sure, ask a supervisor to double-check. If you’re booking a partner award (meaning the airline that is operating your flight is a different airline than the one that issued your ticket), you can also check your reservation on their Web site to see whether a ticket number is attached.
Avoid problems at the airport. Check your reservations carefully. And if anything looks off, get in touch with the airline that issued your ticket.
A lot of people have been asking for an explainer on what is going on with Southwest Airlines and the massive meltdown that has occurred. I’m almost at a loss for words: Southwest is the largest US domestic airline. They serve 23 of the top 25 markets in the US. One of my friends is currently stranded with his cat in Las Vegas, and Southwest can’t get him back home until *checks notes* 2023.
When it suits them Southwest says, in effect, “we’re a small carrier serving small places, the rules shouldn’t really apply to us” (whether it’s safety or anything else) but the reality is that they’re a major airline. They should be considered as such, and treated accordingly.
However, Southwest is highly unusual. Their IT is almost entirely homegrown, with software they built themselves. It’s creaky and antiquated – you’ll observe this if you watch their schedules. They’re irregularly and manually loaded into the system. The majority of airlines use standardized reservations systems like Sabre, Amadeus, etc. which integrate well with other standardized tools. While Southwest has kinda sorta migrated to Amadeus, they only support limited integrations in specific circumstances.
Other airlines (apart from Allegiant, Southwest, Spirit, Frontier and a couple others like Avelo and Breeze) have relationships with airport hotels so they can issue vouchers to stranded passengers and crew. They also work with each other in a system called “interlining” where they take each other’s passengers to avoid total systemic meltdowns like these. For example, when Delta melted down in the past, American and United have bailed them out (and vice-versa). In this case, it’s the week between Christmas and New Year, and there are no seats on other airlines to book their passengers into. Even if there were, there is no interline agreement. So Southwest behaves like an ultra low cost carrier (where you expect poor service and paid a fare to match, rather than the above-market fares Southwest often charges), basically says “see you next week” and dumps you wherever they left you.
So, about aircraft positioning and crew scheduling – Southwest is essentially a short and medium haul airline. They mostly don’t do long haul services except for Hawaii. Southwest turns aircraft quickly, in less than 30 minutes. They have higher aircraft utilization than any other major US airline. They often run their crews on tight loops where they’re out from home and back the same day so they can save money on accommodating crews who overnight away from their home base. This is all really clever and it works really well until it doesn’t.
So when Southwest melted down due to weather events, they didn’t have nearly the number of rooms reserved that they needed for their own crew, and it was Christmas so hotels were full. Crews often did not get rooms. They just got dumped like passengers at airports. At least there are crew break rooms at most airports, but it’s not very comfortable. Major airlines usually have enough hotel relationships to be able to work something out (American has had some issues too) but Southwest does not.
The airline now has a problem where they need to figure out where all of their crews are (lacking accommodations, some have found their own way home), and where their planes are, and whether either are where they need to be, and basically redo their entire crew and aircraft scheduling plan for the whole airline. The only real way they have to do this (because of the way they operate and their limited IT capabilities) is to stop for an entire day and set to work inventorying their assets and crews and then build out entirely new trips for everyone.
However, they were also just really mean to everyone who works for them, and who knows what that will do for the motivation of their employees. They effectively required employees to come to work sick, making others sick just before they’re most needed to recover the operation. Given Southwest’s checkered past with safety, will they pressure employees to work when they really aren’t fit to fly? I personally hope the FAA is watching.
Anyway, how does Southwest fix this? Just like in IT security, every time there is a high profile problem, there is a vendor promising to magically fix everything with AI. Unfortunately, just like in IT security, the problem space is also very complicated and AI is not good at solving most of these problems. One way they could handle it is already proven, it’s just expensive: holding crews and aircraft in reserve to recover from irregular operations. Qantas successfully does this.
A week ago, Qantas had an A380 unexpectedly land in Azerbaijan. They thought there might be a fire in the cargo bay so they landed in Baku. It turned out there was a real problem with the aircraft and it couldn’t be promptly repaired in Azerbaijan, a country which doesn’t frequently see A380s. So, Qantas sent a rescue flight, something that Southwest has repeatedly proven they lack the capability to do. Because Qantas plans ahead for emergencies (and they absorb the expense of doing so), they were effectively able to recover their operation.
To be fair, it’s not just Southwest who does their route planning this way. You see the same sort of problems with Flair Airlines in Canada. They’re an extreme example but fairly representative. Flair serves 34 destinations with 24 aircraft. You can imagine the follow-on impact if any flight, on any leg, has a problem. So why would an airline do this? It seems crazy, right? Well, it’s a question of incentives.
This holiday season could have worked out really well for Southwest, had everything gone according to (a very aggressive) plan. Southwest did their route planning the same way that most American companies do supply chain planning: “just in time” with no slack or contingency planning. If it all melts down, they simply dump the problem on their customers. Southwest, after all, legally has no responsibility to practically anyone except for their shareholders. They are covered by their Contract of Carriage and US Department of Transportation rules (which are lasseiz-faire at best).
You didn’t get home for Christmas? You got stranded in Las Vegas for a week? Well, dear consumer, Southwest won’t help you, the government won’t help you, nobody will compensate you for the losses you suffered, and you also can’t sue because the federal government has given airlines a liability shield along with endless taxpayer bailouts. If you don’t like it, you’re looking at one middle finger from the federal government, and another from Southwest.
One last piece of airline trivia before I leave you all to digest this post. American Airlines cancelled less than 1% of its schedule yesterday. Southwest cancelled over 70% of its schedule. Southwest will likely (successfully) claim that under the Contract of Carriage, they do not have to pay for stranded passengers’ hotels. Keep this in mind any time that politicians show up saying that every problem will be fixed with tort reform to keep evil class action lawyers from driving up costs.
What’s the fix? Liability. Airlines are actually run by really smart people. They’re just allowed to optimize for only one thing: shareholder returns. As it turns out, this hasn’t worked out any better for essential services like airlines than it has for any other sector of the US economy. We need to be OK with the idea that corporations have obligations other than shareholder value, and those obligations extend for longer than this quarter’s earnings call. Create damages which aren’t excluded from class action liability, and airlines will suddenly become extremely interested in reliability (as well as extremely interested in a DOT-regulated standard for weather delays and disruptions).
I don’t personally think re-regulating is the solution, as many pundits have proposed. Instead, financial accountability is the solution. The US should just copy EU 261 from the European Union. It has worked very well to improve airline reliability in Europe because there are actual financial penalties paid to consumers. There have still been occasional meltdowns, but far smaller scale than the largest domestic passenger airline in the US entirely collapsing for multiple days.
Some people will say that this will drive up costs, making flying more expensive. With respect, I observe that you can routinely fly over 1,500 miles within Europe for under 22 euros:
It’s long past the time that airlines should get a free pass (if they ever should have). Real, financial penalties are a market-based solution to encourage airlines to improve reliability. Organizations respond to incentives, and the federal government must create the right ones.
Churchill, Manitoba has been on my bucket list ever since I first spotted it on a map as a kid. It’s in the Canadian sub-arctic, located on the shores of Hudson Bay, and is served by both air and rail (a rail line making it as far north as Churchill is incredibly unusual). There is, however, no road, making this a challenging location to visit.
Why visit? It’s one of the world’s most accessible places to see polar bears. Hudson Bay freezes earlier than other locations near Churchill because the Churchill River dilutes the salt content. This makes the bears happy, because they’re able to get out onto the sea ice and hunt seals earlier than in other locations. Polar bear season runs from mid-October through mid-November, and it’s easier to spot polar bears during this time than in any other time and place in the world. Of course, this also means a lot of visitors to Churchill during a compressed time frame, which makes this a generally expensive destination.
Most visitors to Churchill book with a tour group. However, this is a decidedly upmarket destination, and tours cost upwards of $7,000 (often plus airfare). That’s obviously out of my budget so I decided to try to visit Churchill “Seat 31B style” and see just how far I could make my budget stretch. I figured that it would be more possible in 2022 than in other years, because when I booked the trip (in May), the Canadian border was only barely open, crossings required the ArriveCAN app, and there was still a ton of uncertainty in Canada about the COVID situation. In May, enough was moving in the right direction to start making serious plans.
The first thing I needed was a way to get to Churchill, and that is typically the hardest part. You have only one choice of airline: Calm Air. They fly from Winnipeg (and only Winnipeg), and you can’t book an award ticket to Churchill on a single itinerary using points, or for that matter, online at all. You can use Aeroplan points to book the flight from Winnipeg to Churchill over the phone on Calm Air (priced at 15k points roundtrip), plus a whopping fuel surcharge – it was $330 in Canadian dollars. When can you go? Theoretically, anytime: Calm Air makes two seats available per flight for Aeroplan members. In my case, the only dates available with points during polar bear season were the exact dates that tundra buggy expeditions weren’t available (there are three companies that operate these specialized vehicles which travel in permitted areas). I went ahead and grabbed the seats, hoping for the best.
The second thing I needed was a place to stay. There are very few options, so I swallowed hard and booked with Sarah’s Dreamhouse which proved to be an excellent decision. There is a very strict cancellation policy (which is understandable given the heavy demand) and prices during polar bear season aren’t cheap, but they’re less expensive than the alternatives. I ended up shelling out nearly USD$600 for 3 nights. This broke my “under $100 per night” general rule, but there just isn’t anything cheaper in Churchill (unless you want to try to sleep in the railway station). Given the limited number of places to stay and the heavy demand during polar bear season, I was really optimizing for any accommodations being available at all, so the fact that the lowest priced accommodation was available was a huge bonus.
The final thing I needed was positioning flights to Winnipeg for my flights to and from Churchill, since I couldn’t do the whole thing on a single Aeroplan ticket. It’s not always a great deal to use points for flights, and this was definitely the case here. The reason for this is that a low cost airline is competing on the route, and Westjet and Air Canada offer competitive fares–but only in basic economy (I paid less than USD$50 for my Winnipeg-Vancouver flight on Westjet). Both tickets I bought were basic economy fares, flying with Air Canada from Vancouver on the outbound, and with Westjet from Winnipeg on the return. I wasn’t able to comfortably route from Vancouver on the same day, due to the 10:15am departure from Winnipeg, so I booked the Vancouver-Winnipeg flight a day earlier. This meant that I also needed a transit hotel. I booked the Holiday Inn – Airport West, breaking my $100 per night rule here as well (by 50 cents), which proved to be an excellent choice because an airport shuttle is included (many properties have eliminated these). This saved me about CAD$20 each way to and from the airport, not only making this the lowest cost option but also being located directly across the street from restaurants and a Shoppers Drug Mart.
Having secured flights and a place to stay, I started looking at tours, but it was really hard to decide what to book. I decided I’d more or less figure things out when I got there. This is sometimes a great idea and sometimes a terrible one, but it worked out really well in my case. My host in Churchill picked me up at the airport and a few minutes later, I was wandering around town. I ended up spending my first day following–on foot–tour buses full of $7,000 per head tourists all dressed in identical blue parkas, and just walking into places in town the groups had just left. I saw the Eskimo Museum, the Churchill Visitor’s Centre, and Polar Bears International and I pretty much had all of them to myself (the staff were all super friendly). All of these were also free and it was a great way to get situated on my first day. I capped off the evening by doing some grocery shopping at the Northern store.
Every time I visit the Arctic I’m caught off guard by the high prices, and Churchill did not disappoint with grocery costs approximately 3x those in Vancouver. Since Sarah’s Dreamhouse has a kitchen, I was able to cook for myself. Restaurants in Churchill aren’t bad, but they are set up to serve tour groups making them crowded and offering limited menus. I only ate one restaurant meal the whole time I was there. There are two grocery stores in town, the Northern store and the Tamarack Market, and Tamarack has generally lower prices and friendlier service (but a much more limited selection). They also have an in-store bakery and the baked goods are excellent and reasonably priced (try the cinnamon rolls, hot out of the oven). They also have pretty good deli sandwiches, at prices that aren’t too crazy.
On the recommendation of some visitors who were also staying at Sarah’s Dreamhouse, I booked a half day tour with a company called Sub-Arctic Explorers. The guide was great–he was born and raised in Churchill, owns the local propane distributor, and also works as a tour guide on weekends (it was my impression that he enjoys the outdoors anyway, so guiding is a great excuse to do what he loves). This led to my first (and only) polar bear sighting of the trip! Polar bears are hard to spot because they like to hang out on the rocks, many of which are covered in white snow, and they’re white. When they lie down, it’s very hard to see them.
I spent Saturday afternoon at the Churchill Northern Studies Centre, which is a nonprofit lab facility for researchers located on the grounds of a former military rocket base. It’s a similar setup to the Antarctic facilities operated by the US Antarctic Program. I booked their first ever tour for the general public (they do give tours to school groups, tour groups etc.) and given that they weren’t really sure what everyone would be interested in, we were pretty much given the run of the place. This was capped off by a lecture by the executive director of the facility, himself a polar bear researcher and a well recognized local expert. It cost CAD$63 for the tour, including transportation, and it was totally worth it! I knew nothing about the research station before my visit, and simply booked the tour on their Web page at the last minute when I noticed they’d be offering one at a convenient time.
I rented a car on Sunday, and drove around looking for polar bears (taking an hour out during the day for a polar bear safety lecture offered by a local park ranger and game warden, who assured me that my plan was a pretty bad idea, and another hour at Cape Merry, where I was given a red carpet tour by two armed polar bear guards and two Parks Canada rangers). It is perhaps fortunate that I didn’t find any bears on my own; as it turns out, they are apex predators and they’ll kill you for fun. None of the locals go out in bear country unarmed. It was super fun to drive around Churchill in a Jeep though, tackling roads where tour companies wouldn’t be able to drive in their vans. And then Monday, it was time to fly back! That was an adventure in and of itself, and one that I’ll write about in a future installment (suffice it to say that the flight I was supposed to be on was cancelled, and I would be stuck in Churchill right now if I hadn’t been proactive).
Is travel with miles and points really free? Not even close! My trip cost me about $400 per day even after spending my points for the flight. There is just no way around Churchill being an expensive destination. Now, is the ~$1600 I spent more than people spend in more conventional locations? Definitely not–you’d easily spend this at a Disney park or in Las Vegas, and far more than this in Hawaii. Still, it’s important to maintain some perspective on this. When you’re traveling with miles and points, you’ll spend a lot more on your trip than just the flight. Here’s a breakdown of what I spent:
Overall, I’m really happy to have achieved a “bucket list” travel goal. Ever since I was eight years old, I have been fascinated by Churchill. It was every bit as incredible as I was hoping it would be, despite not being able to take a “tundra buggy” tour (these aren’t the only way to see polar bears!) and not planning very much in advance. If I had carefully planned every detail, I would have missed out on a lot of serendipitous discoveries. That being said, even though everything worked out for me, it’s easy for things not to work out in a place like Churchill. You should probably go in with at least some sort of plan, but in the Far North, planning trips by yourself will save you a lot of money versus booking through a tour company.
Air Canada Aeroplan is a popular program to use for award bookings, so it’s not surprising that a lot of people outside of Canada engage with it. You can transfer your points from American Express, Capital One, Marriott Bonvoy and Chase to the Aeroplan program, and use them to book flights on either Air Canada or its truly massive number of airline partners (both StarAlliance and other carriers such as Etihad and Oman Air). So given that, you might be tempted to pick up a Chase Aeroplan co-branded card. These recently launched, and they come with a generous sign-up bonus along with some excellent bonus categories (such as 3x points at grocery stores).
Well, if you had the Chase Aeroplan card in mind to get you closer to an Aeroplan award, you might want to put those plans on hold. Air Canada has just updated their Aeroplan terms and conditions with some vague and disturbing legalese to their Terms and Conditions that seems targeted at people who qualify for welcome bonuses from Aeroplan banking partners (like Chase):
"Aeroplan may, in its sole discretion, choose to limit the number of Welcome Bonuses or similar bonuses or incentives a Member may receive in any period, and, in addition to the other remedies set forth in these Terms and Conditions, reserves the right to suspend, revoke or terminate the Account of any person who engages in a behaviour of excessive use of the Welcome Bonus offers."
Aeroplan then goes on to vaguely define what it considers abuse in a non-specific way. It’s important to note that this language appeared after multiple Canadian users of Aeroplan reported that their accounts have already been locked “at the request of a bank” after qualifying for signup bonuses, so it appears that Aeroplan is already locking accounts based on some set of criteria.
One of the downsides of frequent flier programs is that they are almost entirely unregulated, and when they operate in countries like Canada (which offers generally poor consumer protections, especially when it comes to airlines) you’re pretty much entirely at the mercy of an airline. They control the vertical and the horizontal. The points in your account hold no value, as they happily remind you in the Terms and Conditions (irrespective of the fact that you can buy them from the airline for actual money), and they also don’t belong to you. It’s very much a one-sided deal.
I don’t know how this is going to ultimately shake out. It’s almost unheard of that an airline program would lock a frequent flier account because of a legitimately earned signup bonus. However, this has clearly happened. Until the dust settles, I recommend that you don’t sign up for the Chase co-branded Aeroplan card. There aren’t enough benefits to holding the card for most people in the US to justify the risk that Aeroplan will randomly decide to torch your account because you earned a signup bonus.
In my article on speculative transfers, one of the redemptions I briefly highlighted was using Flying Blue points for WestJet flights. This used to be a really good deal,costing a roughly flat rate 14,500 points for economy class travel anywhere in North America. Well, Flying Blue must have seen my article, because after I speculatively transferred my Brex points into their program, they massively raised award prices on most WestJet redemptions (along with the majority of other awards). The keyword is “most.” While the majority of prices are totally crazy and you’d never want to redeem your points at these award levels, there are still a few sweet spots.
When redeeming Flying Blue points for WestJet flights, Flying Blue seems to charge by the number of segments and the distance you’re flying. You’ll always pay more points for a multi-segment flight than you will for a nonstop flight, but the pricing is all over the place. For example, a flight between Vancouver and Victoria costs 10,500 points. If you connect in Calgary, however, the same flight costs 21,000 points. You might be forgiven if you think that Flying Blue is just adding up the pricing of each segment if you took them individually, but that isn’t true. For example, Vancouver to Calgary costs 10,500 points, and Calgary to Edmonton also costs 10,500 points. However, if you fly from Vancouver to Edmonton with a connection in Calgary, it costs 11,000 points. Neither price is likely to be a good deal on this heavily competitive route, though.
The price goes up if you’re flying farther, and the pricing also makes less sense. Flying to Winnipeg? It’s a steep 17,500 points for a nonstop flight, or a ridiculous 22,000 points if you connect in Calgary (note that this is a $110 flight on a low cost carrier, or a $172 flight on WestJet, so this objectively isn’t a good redemption). Although connecting in Calgary creates a difference of only 8 flown miles (1,162 vs. 1,170 miles) and it doesn’t seem to cross any obvious threshold of either a mileage band or a logical break in journey (the pricing difference applies to flights with only a one hour connection), it’s a 4,500 point price difference!
Pricing gets even more wild when you look at longer flights. It costs $45 on a low cost carrier from Vancouver to Toronto. It’s $124 on Westjet. Or you can spend half of the low cost carrier fare in taxes, and a cool 27,500 Flying Blue points:
I mean, the sky is really the limit on Flying Blue’s crazy pricing. Check out how much Flying Blue wants for a coast-to-coast flight within Canada, which would cost $150 on a low cost carrier, or $254 on WestJet:
Given all of this, it’d be reasonable to conclude that there is no value left in WestJet redemptions, just like Flying Blue has sucked the value out of most other redemptions. And you’d be mostly correct. However, WestJet serves a few airports that are spectacularly expensive destinations. If you redeem strategically, there is still incredible value.
Take Terrace, British Columbia for example. If you want to go on short notice, especially during the peak travel season, you’re looking at some really expensive fares. Here’s what a one way flight tomorrow would cost, which is roughly the same price as last weekend’s flight (which I booked) was selling for:
However, you can book this flight with Flying Blue points, at a value that might knock your socks off:
WestJet has exceptionally generous award availability, and when you redeem Flying Blue points, the pricing is fixed price. The award pricing is usually very high, but for short haul flights, it’s pretty reasonable.
What does flying to Terrace on a beautiful, clear, last weekend of summer accomplish? Well, that’s a trip report in and of itself, but here’s a preview:
One of the most-vaunted benefits of the American Express Platinum card is that you receive a $200 credit when booking with Fine Hotels and Resorts. This is an American Express Travel program which is only available to Platinum card holders, and which provides substantial benefits: free breakfast, a $100 property credit and a 4pm late check-out. You can also receive a $200 credit on your Amex card when you book a stay with Fine Hotels and Resorts.
I mean, look at this incredible set of benefits. It’s right there on the front page:
OK, sure, there’s some fine print. Not all benefits are available at every hotel, right? However, there’s a guarantee of at least $100 in benefits. That sounds pretty good, doesn’t it?
There’s only one catch: these rates are often higher than if you book with the hotel directly, and these are some astonishingly expensive hotels; some of the most expensive properties in the world. However, I needed a one night stay in Amman, Jordan, where $241 buys you a room at the St. Regis. Minus the $200 credit, we’d be right around the $40 I usually spend per night in a location like Amman, so I was fine splashing out and living a little. I booked my completely non-refundable room through Amex at a rate higher than I could have gotten directly from the hotel, and I did receive the $200 Fine Hotels and Resorts credit.
Unfortunately, when something seems too good to be true, it probably is. Amex just outright scammed me with the following clause in their Terms and Conditions:
When I checked in this evening at the St. Regis, I was told that I booked through Expedia, had just a basic room, breakfast wasn’t included, and that I didn’t get a property credit. I was confused so contacted Amex, who informed me that Fine Hotels and Resorts benefits are only available for two night stays, and since my stay was one night, I didn’t get anything. The above unfair and deceptive trade practice they pointed to when trying to weasel out of providing the correct set of benefits isn’t even consistent with what I’d actually receive if this were true, since I’d get only half of the promised value (using Amex’s math) if I stayed for two nights.
I have been trying to resolve this with Amex for well over an hour (through two chat sessions and a phone call), and as of this writing, I’m still sitting on hold.
However, I’m likely to cancel my Amex Platinum card over this. Amex has continually raised the annual fee while making benefits harder to use, but they have thus far avoided being outright deceptive. This crosses the line: it is a scam. There is no other way to describe it. Be prepared to be embarrassed at the front desk of the St. Regis if you fall into the same trap I did.
Update: Two hours in, Amex Travel supervisor DJ admitted that this was their error and I should have received the benefits. However, they effectively had no way to fix the problem. Instead, I was promised an expiring $300 Amex Travel voucher. This makes me a little more than whole (although doesn’t quite compensate for the time spent running down the compensation), so I’m calling it a day. That being said, please comment below if you have been impacted by the same problem!
Hi! It has certainly been awhile since I posted last. I’ll be posting more about how my life has evolved since 2019, but suffice it to say that two years of pandemic (which is still grinding on) has led to some major changes. I’m starting to travel again, though, because the world is opening back up again and this is a part of my life that I missed a lot. And more importantly, I’m starting to book more travel (both for myself and for AwardCat clients), which means that I’m working with frequent flier programs a lot more. These have also changed a lot in the past two years, but I have a pretty good idea of which programs I’ll be using and where they are most likely to come in handy.
The conventional wisdom you’ll read on other blogs is to never make speculative transfers from banks into airline programs. Instead, blogs encourage leaving your miles in a bank program (such as Amex, Chase, Capital One or Citi) until you want to redeem an award. This advice is usually on point, and it’s what I will generally advise AwardCat clients to follow. After all, you don’t have to worry about your points expiring in a bank program (as long as you keep at least one card active in the program), and as quickly as airlines are devaluing points in frequent flier programs, banks are adding greater value to their own programs. After all, banks want you engaged with them, not the airlines.
Occasionally, however, an offer will come along that–for me–is worth breaking the usual rules. Two such offers are available, and expiring today: Chase is offering a 25% transfer bonus to Flying Blue, and American Express is offering a 40% transfer bonus to Avios. Last night, I cleaned out my entire Chase account to transfer points to Flying Blue, and I transferred about 100k Amex points with the 40% bonus to Avios. I’ll explain why I did it, and how bucking the conventional wisdom might be a good idea if you have specific future redemptions in mind.
Flying Blue + Westjet
One of the recent changes I made in my life was moving to the greater Vancouver area, which now makes YVR my home airport. Vancouver has the second largest airport on the West Coast with nonstop flights all over the world, but if you’re traveling within North America, the two major Canadian airlines (Air Canada and Westjet) are top dog. They have the most nonstop flights from Vancouver to both US and Canadian destinations.
This presents a really amazing sweet spot for me, because Westjet partners with the Flying Blue frequent flier program, and Westjet also has extremely generous award availability at low redemption rates. For example, you can book economy class travel anywhere in North America for 14,500 points, or 17,500 points each way to the Carribbean. Unlike in the Delta program, the price doesn’t go up the closer you get to departure, either. And there are no fuel surcharges or booking fees; you only pay actual taxes.
I had 28,000 Chase Ultimate Rewards points, after spending most of my points on the Dubai Hyatt Jumeirah for a forced 10 day quarantine (that’s another story I’ll write about later). Transferring these to Flying Blue got me 35,000 points, which is enough for a nice holiday in the Caribbean this winter. Does this make sense? Of course it does, even though I don’t know exactly what I want to book right now. What’s more, I have pretty much completely drained my Chase account, so I can close the Chase Sapphire Preferred when the annual fee comes due and overall stop engaging with the Chase program (which has lost competitiveness).
Avios + Iberia, Qatar, Sri Lankan and “Royal” Partners
The Avios program has been a mixed bag since 2019. They have gone through multiple rounds of devaluations (including stealth devaluations), often with no prior notice. For example, redemption rates within Asia were previously a sweet spot, but JAL and Cathay Pacific award tickets became more expensive last year. The prices even went up last year for travel on British Airways. In the meantime, although theoretical sweet spots remain on the award chart for award tickets on American and Alaska Airlines, the practical reality is much different. Both airlines have gotten much harder to book using Avios, because fewer seats are being given away to partners (this impacts not only Avios, but also programs such as Cathay Pacific Asia Miles). Wide-open availability between, say, Seattle and Los Angeles or San Francisco and Hawaii is a thing of the past. Keep this in mind when you read mainstream blog articles breathlessly espousing the large signup bonuses for Avios co-branded cards, and touting the award chart as if that equates in any way to actual availability.
Given such a recent history of bad behavior by both the Avios program and partners in the ecosystem, you might be surprised that I’d move a pretty substantial chunk of American Express points into this program. Why? Where one door closes another opens, and Avios has two new partners in the ecosystem: Royal Air Maroc and Qatar Airways. Additionally, I think Iberia, Royal Jordanian and Sri Lankan are underappreciated partners given the very low redemption rates that are often possible with these airlines.
This isn’t an article about the Avios program as a whole. I’ll write one of those going into the sweet spots in detail, so I’ll just talk about some of my personal favorites as a representative example.
Long Haul Premium Cabin Flights On Qatar
The conventional wisdom for redeeming Avios is that they’re good for short to mid haul flights in economy class, on airlines without fuel surcharges. However, they’re super expensive to use for long haul flights in premium cabins, especially on airlines like British Airways with fuel surcharges.
This is now out the window when flying Qatar Airways and using Avios. Qatar recently adopted Avios as its frequent flier currency, and the award chart is much different for flights on Qatar, likely because Qatar is so focused on long haul flights. Additionally, fuel surcharges have been dramatically reduced. Given the new redemption rates, I was able to redeem 85,000 Qatar Qpoints (which transferred in 1:1 from British Airways Avios) plus $224 in cash for Qsuites on an Almaty-Doha-Los Angeles itinerary (yes, I know this is Seat 31B, but this is also almost as far as you can travel in the world. For me, paying about double the points to do it in business class was totally worth it on this route). With the transfer bonus, it cost only 61,000 Amex points which is almost totally unheard of when using Avios for this length of flight. Assuming you can find availability, it’d cost 75k points with American AAdvantage points, or a minimum of 90k points with Asia Miles.
Flights Within Africa On Royal Air Maroc
The conventional wisdom used to be to base yourself for a few months in Hong Kong and then hop around Asia using cheap Avios redemptions on Cathay Pacific, using absurdly low numbers of points for flights that would otherwise be super expensive. This was already on the way out before the pandemic (Cathay Pacific pulled partner availability inside of 14 days), and if Hong Kong and Japan ever open again, flights with Avios are now a lot more expensive.
However, where one door closes, another opens, and that door is in Africa now. Royal Air Maroc flies a ton of places in Africa, and these flights would normally (like many things in Africa) be insanely expensive. Take Casablanca to Lome, Togo. This flight costs 11,000 Avios, plus $29 in tax. It would cost 30,000 AAdvantage points for the same flight, or a whopping $582 in cash! That’s a solid 5 cents per point (or 7 cents per Amex point if you got your Avios with a transfer bonus) in value for an economy class flight–and this is real value, not theoretical value based on a premium cabin seat you’d never otherwise buy.
Is this the only sweet spot with Royal Air Maroc? Nope! There are plenty of others. Casablanca is a low tax airport and Royal Air Maroc doesn’t have fuel surcharges. You can base yourself in Casablanca and hop all over Europe and Africa with extremely generous award availability and very little cash out of pocket for each flight. Now, this isn’t the fanciest airline with the best inflight service, but who cares when it’s this cheap?
Royal Jordanian and Sri Lankan
Royal Jordanian doesn’t get a ton of attention, apart from their high fuel surcharges and apparent willingness to fly through storms that would result in a cancelled flight at other airlines (that being said, their pilots are mostly former Air Force and the airline hasn’t had a major incident in over 35 years). So what makes them interesting? They fly some highly unusual routes. I’m flying them from Tel Aviv to Amman, which is one of the shortest mainline commercial routes in the world. The flight would normally cost about $300 all-in, but I paid 6,000 Avios plus around $100 in taxes and fuel surcharges. It’s not cheap to use Avios on Royal Jordanian, but you can get very good value for your points, particularly if you’re getting the points with a transfer bonus.
Take Amman to Erbil, for example (Erbil is in the Kurdish-controlled part of Iraq, and is relatively safe to visit compared to other parts of Iraq). On a few dates I checked, Royal Jordanian is selling this short flight for $287. Alternatively, you can pay 6,000 Avios plus $135, which is a solid 2.5 cents per point–or 3.5 cents per Amex point if you got your Avios with a 40% transfer bonus.
Sri Lankan is a similar niche airline that is widely ignored due to laughably high fuel surcharges, but with good value Avios redemption pricing to otherwise expensive destinations. You really have to crunch the numbers though because they can have cash fares that are better value than paying with points. Take, for example, one route I have flown, from Colombo to The Seychelles. I picked a random October date and the flight costs 194,113 Sri Lankan rupees (which at today’s exchange rates is $539.61). If you pay with points, it costs 11,000 Avios plus $255. That works out to almost 2.6 cents per point, or 3.6 cents per Amex point if you got your Avios with a 40% transfer bonus.
Iberia gets a lot of attention for the low redemption rates, with relatively low fuel surcharges, on East Coast to Madrid routes in premium cabins. This requires moving your points into Iberia’s own program and finding availability, which is super hard. Other blogs have documented this extensively (usually while hard selling Avios credit cards) and it’s fine to use Iberia Avios this way, but I’d personally sit in economy class for one of these routes. It’s only 7 hours from New York to Madrid. I’m willing to spend more points to sit up front on a 16 hour flight, but for a 7 hour flight, premium cabins seem like a waste of money to me.
However, how about an 13 hour flight for 51,000 Avios (that’s just 37,000 Amex points with the 40% transfer bonus) in business class, or 25,500 Avios (19,000 Amex points with the 40% transfer bonus) in economy class? That’s what it costs to fly Iberia from Madrid to Montevideo, which is a very nice flight to be on in November when it gets cold in Europe. Ordinarily this would be an over $800 economy class flight. Accounting for taxes and fuel surcharges, you’re getting 2.9 cents per point in value, or 4.2 cents per Amex point in value if you got your Avios with a 40% transfer bonus.
When To Speculatively Transfer
Both of these transfer bonuses expire in a few hours, so if you want to hop on either of them, you should do it right now. However, the most important question is whether you plan to use the points before they will expire, and whether you think the sweet spots you’re after will still be there when you want to take advantage of them. I think that the award flights I’m targeting are in obscure enough partnerships, and in dusty enough corners of award charts, that they’re likely to stick around for awhile. I’m also obsessive to a perhaps unhealthy degree about this stuff (to a point where I help other people book their award travel through AwardCat) so I’m very much on top of my points balances and what is happening in award programs. I feel confident with speculative transfers to both of these programs because I use both of them regularly, and plan to redeem my points before they expire (and hopefully before they devalue).
However, I am going into this with a pretty solid idea of how I’ll use the points. I wouldn’t make a speculative transfer to, say, Asia Miles (since I think Cathay Pacific is likely to declare bankruptcy and may even go out of business entirely), or to Avianca LifeMiles (which has very little credibility as a program given that they block most partner inventory, and don’t even offer much on Avianca). Speculative transfers are, as a general rule, not a great idea–but when done strategically, they can yield incredible value.
“Wait, what?” you might be thinking. “Cars? Isn’t this blog about cheap flights? And where have you been for the last year, anyway?”
Good questions. The last trip out of state that I took was in February, 2020 to Minneapolis. I was joking with my friends, as the pandemic was beginning to take shape, that the last trip I took had better not be to Minneapolis in the winter. Here we are almost a year later and it’s clear that we’re in for nearly another year of limited travel.
I wish I could say that I’ve spent what amounts to nearly a year being productive and catching up on my massive backlog of travel writing. I have a series to finish on Christmas Island, another on Providencia, some advice on how to see Bogota in the blink of an eye, and the list goes on. But like most of you, honestly, I’m not OK with any of this and it’s just too emotionally difficult for me to write about a part of my life that I both loved very much, miss a great deal, and am–frankly–angry doesn’t exist anymore. I’m not sad, or disappointed. The fact that the travel industry has been so thoroughly decimated has been a deliberate choice by politicians on both sides of the aisle to deliberately expose us to a fatal disease amid false hopes of attaining herd immunity. The consequences of this choice have now been borne out with new, more virulent and more contagious strains of COVID-19, one of which largely evades the new vaccines.
That brings me to what I’m doing about my car, and what I’m doing about travel for the next year. Any travel I do will be solo, local (in the Pacific Northwest), and for the most part, outdoors. Camping is in, and crashing at the Generator Hostel in London is out. I drive a 2005 Scion xA, which is a car I really love and have had a lot of good memories with. It also has 184,000 miles on it and has joined the “part of the month club.” In the past few months I have replaced the water pump, thermostat, all of the belts and hoses, clutch, front brakes, and battery. There isn’t a whole lot left to replace at this point but I also feel like this is a vehicle that could be a really solid (albeit elderly) freeway commuter car, but it just can’t take the level of punishing abuse on gravel Forest Service roads that I have in mind for this summer. At some point, I have to recognize that the car, like my body, just isn’t the same as it was when it was young.
Unfortunately, a lot of people have the same idea that I do, and are looking for new or late model used vehicles. New car inventory is very limited now for popular models (along with a spike in demand, production is constrained due to COVID-19 protocols), and I was shocked to learn that dealers are asking for above sticker price for cars–and getting it! Discounts are few and far between. This has spilled over into the used car market as well, making it harder to find late model used cars and also making them more expensive. All of this is great news if you want to sell a car, but it’s terrible news if you want to buy one.
The Auction Solution
So, I went down a rabbit hole on YouTube which started with a local tow truck driver’s channel. I thought “hm, maybe auctions could be a way to get a car at a discount.” After all, most people need to finance a car and auctions require that you pay the full amount immediately in cash. This makes the market somewhat less competitive, and dealers are the usual folks bidding so the prices have to reflect leaving in something for their profit margin. A few clicks later and I landed on Andrei Khaladzinski’s Salvage Secrets channel, and I was instantly hooked.
Andrei is an unassuming Belarusian immigrant who came to the US with $500 in his pocket and now runs a successful small dealership on Long Island in New York. His YouTube videos are the kind of thing I love. He stands in front of a whiteboard in a dimly lit gritty office that has probably not been painted since 1992, and with a laser focus, he walks through the numbers, nuts and bolts of bidding on salvage auctions. And holy smokes, what a discovery this was! In a weekend-long deep dive, I was able to learn enough from Andrei’s decades of experience to save $9,000 on the cost of a 2019 Subaru Outback 2.5i with 14,000 miles on it. I paid $15,588 (plus state sales tax, title and licensing fees) all-in. Only one catch: it has a rebuilt title.
“A rebuilt title?” you may be thinking. “That’s crazy! It means the car has been completely trashed! Everything in the world could be wrong with it! It’s not even safe to drive those!” And while thinking this is rational, not all rebuilt title cars are the same, and not all clean title cars are the same. In fact, I will never think about “clean title” cars the same after this experience, because I have really learned more than I ever wanted to about how the sausage is made.
Rebuilt vs. Clean Titles
There is a lot of variability in the different types of titles and the procedures to follow in different states. However, the same general ideas and procedures apply in most locales as here in Washington state.
When a car is damaged or destroyed, it doesn’t necessarily mean that the title changes its status from “clean.” For example, rental car companies own their cars, and they are also self-insured. So, when a rental car gets wrecked, it goes to the same salvage auction as insurance totaled vehicles. The same applies to auto dealers.
Check out this “clean title” vehicle. It’s completely destroyed. The engine took a direct hit. Someone will put it back together (maybe with stolen parts, since “clean title” vehicles aren’t routinely inspected for these in most states) and sell it to the next owner, who will never have a clue how badly it was damaged because it has a “clean title.” If insurance never paid out the claim, as is the case if a rental car company (which is self-insured) owns it, nothing will show up on a VIN check (such as Carfax) either.
So what is a “salvage title?” All that this means is that an insurance company has declared the vehicle a total loss. As it turns out, insurance companies have a lot of reasons why they might do this and it doesn’t always mean that the car was even damaged at all, or if it was, that it was damaged in a way that can’t be safely repaired.
When a car is stolen, for example, insurance companies are required to declare the car a total loss and pay out the claim after a set period of time–usually a month. So, consider the following scenario. Your car is stolen by a professional car thief who stashes it in a storage unit and is promptly arrested and jailed on unrelated charges. A couple of months later, after the storage fees remain unpaid, the storage company cracks open the unit, discovers a chop shop, and calls the police who recover your vehicle.
Except it’s not your vehicle anymore. It belongs to the insurance company, because they paid out your claim two months ago and you have moved on with your life. You are happy to recover your personal belongings but now the car is the insurance company’s problem. They send your “totaled” vehicle to auction. There is absolutely nothing wrong with it–not even a scratch, but it’ll have a salvage title.
Other cases of vehicles being totaled are ones where the insurance company just routinely declares a vehicle a total loss if a certain category of loss occurs. My vehicle was allegedly struck by lightning. In October. There is no evidence whatsoever that this actually happened, the car was a local vehicle, lightning storms are very rare at that time of year in our area, they usually occur in the mountains rather than in the nearly sea level valley of Puyallup, and a mechanic has thoroughly checked it out and failed to find anything wrong with it. Nevertheless, USAA (the company that insured this vehicle previously) just automatically totals any vehicles struck by lightning. They don’t want to deal with potentially expensive and difficult to adjudicate problems down the line (because potentially any electrical issues with the car, even years later, could stem from a lightning strike). So even though it’s likely that the previous owner was underwater on their loan and just wanted out from under the vehicle, it ended up totaled and sold at auction.
How Auctions Work
“OK, this makes sense,” you’re thinking. “I want to get in on this!” Keep in mind that the lower prices mean the following:
If you bid and win you own the car and it’s entirely your problem. It doesn’t matter how inaccurate the auction listing is; anything sold “where is/as is with no guarantees” (as auction vehicles are) means exactly that. Plan to do more due diligence (under tougher circumstances) than usual.
Even if the car is brand new, the warranty is void.
You can’t drive the car off the auction lot. You need to figure out how to tow it (or have it towed) to a location where you can either work on it yourself or have someone fix it.
Even if there is nothing wrong with the car, expect some work will be required. Picking up the car on a forklift, moving it out to the lot and towing it on a flatbed apparently dislodged some suspension bushings on mine, a minor repair that cost $60. Other common repairs needed are draining the fuel system if the car has sat for a long time, and replacing the battery (these seem to have gone bad very often on auction cars).
You can’t finance auction purchases using any conventional sort of financing. Instead, you need to be prepared to immediately wire the full amount of your bid, plus fees and potentially sales tax as well, right after the auction is completed. Late fees run $100 per day or so, and the wire is due the day after the auction (so you have to send it on the day of the auction). To wire funds, they need to be in your bank account, free and clear – so you can’t deposit a check and then immediately wire the funds.
There are two major auction houses that dispose of salvage vehicles, IAAI and Copart. It’s possible with IAAI to identify the seller of a vehicle, which you can’t do with Copart, making Copart a riskier auction because a lot of dealers dump their problem vehicles there. I’m not going to go through the details of how the auctions run and how to use auction and broker sites, because there are plenty of other resources (and YouTube videos) that explore these in depth. Instead, I’ll focus on everything else around the auction process which isn’t nearly as well documented.
Auction houses charge a hefty registration fee as well as a bevy of additional fees. You’ll pay “documentation fees,” “gate fees” and a commission which is either a fixed amount or a percentage depending upon the value of the vehicle. I opted not to register directly with IAAI, which was the seller of the vehicle I was interested in. Instead, I signed up with SalvageBid (you can get 30% off of their membership using the promo code on their blog). Although I didn’t need to go through a broker in Washington state (because unlike in most states, anyone is allowed to buy salvage vehicles in any condition here), it was advantageous to do so because broker commissions are much lower than what IAAI offers to the general public. I ended up saving nearly $1,000 in commissions purchasing through SalvageBid (on their most expensive “VIP” membership, which is probably a no brainer if you’re buying a newer car) versus going directly through IAAI.
Although you can go to the auction lot to view cars, it’s a hassle. Both Copart and IAAI are located in far-flung Seattle suburbs each about an hour away from where I live. IAAI only allows registered users on their lot (which means you have to pay their registration fee), while Copart charges $25 if you’re not a registered user (having paid their registration fee). You also need a safety vest, or they’ll charge you for one. And then once you’re there, if you’re not a mechanic, it’s hard to make a good assessment of whether a vehicle is in good shape or not.
Fortunately there is a solution: you can pay carinspector.us to check out your car. I paid them $155, and they delivered a comprehensive report on the car (along with detailed high resolution photos, much better than what IAAI had provided) confirming that there was nothing obviously wrong with it. The report gave me the confidence to bid aggressively on the car because I likely had more information than the majority of bidders.
The 50% Rule
Vehicles sold at auction will have the estimated repair cost and the estimated “actual cash value.” These figures will in some cases only loosely resemble either of the actual values; they come from insurance company estimating software and don’t take into account either the used vehicle market or the true cost of repairs.
Remember Andrei? He works around this by setting a “50% rule.” Having identified a reasonably repairable salvage vehicle (keep in mind, most cars sold at auction aren’t), he will bid no more than 50% of the “ACV,” or “actual cash value.” He also factors all of the fees into his bid, and since he buys a lot of cars, he generally knows exactly what these will be. This gives him enough of a budget both to repair the car and to discount it for having a salvage title instead of a clean title (here in Washington, the expected discount is about 20%).
Andrei is right in his advice not to get carried away with bidding. In this case, I knowingly broke the “50% rule,” because I knew I wasn’t going to have to invest much in the car, giving me more headroom to pay more at auction. The ACV of my car was $25,806 which isn’t far off from what these cars actually sell for (one with double the mileage of mine and a clean title is currently for sale for $26,888 at a local dealer). A previously wrecked car from Louisiana with similar mileage to mine, and also with a salvage title, is selling for just under $20,000. However, that car is being sold by an out of state dealer in Oregon, which is notorious for its virtually unregulated salvage vehicle market. There’s no telling whether the other vehicle has been repaired properly, or with which parts. After all, how did it end up in Oregon when it was sold at auction in Louisiana, anyway?
In the end, I went up to $14,200, and including all fees, I paid $15,588. Adding on the required SalvageBid membership, cost of towing, the oil change that was needed, and the inspections and minor repairs I had performed, I paid $16,433 (I get free wire transfers from my bank, but if you don’t, account for this, too). State tax, title and licensing fees added to the total but I’d have had to pay these with any vehicle, so I’m not including these in the calculation. So, I saved $10,455 versus what a dealer is trying to sell a higher mileage vehicle for. I think realistically, I saved $9k because that’s closer to what I’d pay a private party for a similar vehicle (remember, these are popular vehicles in short supply, not many are for sale, and Blue Book values are pretty far out of step with the market).
You get 3 days to pick up your car from IAAI before they start charging expensive storage fees (think airport parking prices), and the 3 days includes the day of the auction. Making matters worse, they are closed on the weekend so if you miss a Friday pickup (auctions are every Wednesday, and you must arrive before 4pm on Friday to pick up the car) they will charge you storage over the weekend plus Monday.
However, you can’t pick up the car until you’ve paid for it and funds clear. This means that you need to be prepared to wire the funds immediately after the auction closes and you win. The auction is wrapped up by 11:30am and the bank wire cutoff is usually something like 3:15PM Eastern time. Be watching your email for an invoice with wire instructions and I recommend that you get set up with your bank to wire funds through online banking versus going into a branch. That way, you’ll get your car paid out on time to get the vehicle released before you start getting charged for storage.
IAAI won’t release the car to you to drive off the lot, because it’s illegal. You need to have a way to tow it, either by showing up with a car trailer or hiring a towing company to tow it. It’s best to hire a flatbed to tow your car because if there are any problems with the tires, they’ll be unable to tow it with a conventional wrecker. I hired a flatbed that regularly works with my mechanic for $160 to retrieve my car. They gave me a good discount because I allowed them to pick up the car any time that IAAI was open over a 2 day window, and that’s why I got the discount: they picked up my car when they’d otherwise be making an empty return trip.
Passing Inspection And Registration In Washington
Registering a salvage vehicle in Washington is different than a regular vehicle and there is virtually no information available online about how to do it. I had to figure it all out on my own but it all worked. Other states have their own procedures ranging from refusing to allow salvage vehicles to be registered at all to allowing them on the road with virtually no inspection or documentation. Washington is pretty middle-of-the-road as requirements go, but definitely research your local procedures before you buy a salvage car.
After I paid SalvageBid, they promptly sent me a DocuSign for a bill of sale. In Washington, that’s all you get; the insurance company notifies the Department of Licensing when they total a vehicle and the state cancels the title. A salvage vehicle is simply a vehicle with no title, and this means it is not street legal in the State of Washington.
In order to get plates and register the car, you will need to have it inspected by the State Patrol. So, first have the car repaired (or repair it yourself) in a manner that will pass inspection. Then schedule your inspection. You need to start looking right at 8am on Monday because that’s when appointments are loaded into the system, and they’re all gone within a couple of hours. Check every location around you (I was able to get an appointment in Bellevue, but not in SeaTac) and ignore all of the warnings not to schedule an appointment without the Department of Licensing request. You need the date of the inspection for the Department of Licensing, and WSP availability is the constraint.
Once you have the car repaired and your appointment scheduled, head down to your local Department of Licensing agency (the same place where you get tabs, not where you get your driver’s license) with the bill of sale for the car that either the auction house or your broker sent you. Tell them that you bought the car in an online auction and you need to have it inspected by WSP. They’ll issue you a temporary permit for $8 (pay cash to avoid the $2.25 credit card fee) which will allow you to drive the car to a State Patrol facility for inspection. You get two separate dates and they can be non-consecutive, so give them the date you’ve scheduled and another date a couple of weeks later. That way, you can try again if you fail inspection the first time.
When you go for the WSP inspection, display the temporary license you got from the Department of Licensing (they do check, and if you don’t have it displayed, I assume it’s an instant ticket). You will also need to take the following documents:
The bill of sale from your broker or auction house.
Receipts for all of the parts you used in your repair, as well as any labor receipts.
Pay attention to the WSP’s checklist before you buy anything and be sure to get the correct documentation because without it, you won’t pass!
Be especially wary of parts purchased online (such as on Craigslist) which are often stolen. Parts sold by licensed junkyards are a safer bet, when sold with invoice and serial numbers as applicable.
The “Request for Inspection” from the Department of Licensing.
Be sure to show up at least 5 minutes early and allow extra time for Google Maps to direct you to the wrong place (this happens in Bellevue). WSP doesn’t have a public restroom, so include that in your plan as well.
My WSP inspection was thorough, courteous and professional. The officer ran everything “by the book” and I got back their inspection report and the bill of sale. They stamped both, and they also affixed an official label inside the door which indicates the vehicle has been rebuilt and inspected.
I then returned to the Department of Licensing agent, who took all of the documentation and collected $1,908.15 in tax, title and licensing fees. Naturally, I paid cash to avoid the 3% credit card fee. They issue your new license plates on the spot, and your title shows up in the mail 8 weeks later.
What About Insurance?
My insurance company wrote me a full coverage policy without even batting an eye. No surcharges, and exactly the same rates as if the vehicle didn’t have a rebuilt title. Your mileage may vary but most insurance companies in Washington don’t seem to consider salvage vehicles (which have been inspected and are street legal) to be much—if any—higher risk than other vehicles. I suspect that this has to do with the strict inspection requirement here, which many other states (such as Oregon) do not have.
Driving For Free?
For most people, a car is a liability. My car is an asset–it’s worth more than I paid for it. Since much of the depreciation on a new car is front loaded within the first 2 years, I’ll have another 3 years (or so) to drive this car before its value drops below what I paid for it. In effect, I’m driving for free when you really think about it. And that’s what makes this a perfect Seat 31B travel hack!
I spent less overall time doing this than I have spent finding and booking Cathay Pacific first class, and I’ll be getting years of effectively free road trips out of it. You can too. It’s high risk, but nothing in the free travel game is low risk. May the odds ever be in your favor.