Virgin Companion Fares. Part 2. Delight? Or disaster?

Following on from the previous post which I hope convinced you that your best option when booking reward travel in Virgin in economy will usually be to buy one cash ticket in Economy Classic and add a companion reward, the fact that these rewards must book into the Economy Classic flavour of Economy means that we ought to also compare being in Economy Classic to the other offerings to check that our good deal actually remains so. I will retain the assumption that the intention is to fly two people to Barbados round trip for a holiday – and for now that you aren’t going to look for an upgrade into premium, that will be looked at in a third post.

Firstly, let’s summarise the differences between the style of Economy.

Light – no checked bag, no seat selection, no refunds or changes, 25% miles earning

Classic – usually £80 more – free bag, free standard selection, limited flexibility, 50% miles

Delight – usually another £100 – 3” more pitch, free selection, free bag, 150% miles, priority boarding

The prices are not quite what they seem though as we need to consider the different mileage earnings. The flown distance on this route is 8400 miles – so if we value the miles at 1p, moving down from Classic to Light you lose around £20 of miles, so it only really saves you £60, and the buy up to Delight only really costs £16 because you get an extra 8400 miles back. Which means if you are just paying cash, then it is a simple question of do you pay £15 for 16hrs worth of extra legroom? This is not a hard question to answer!

But there is a catch here – it’s not really a £15 buy up from Classic to Delight. As we know from the previous post – the best deal when booking Classic is almost certainly to use miles, likely a companion award, sometimes two standard awards. It isn’t to buy two cash tickets. So to properly compare this, we need to work out the price premium for being in Delight compared to cheapest way of being in Classic at that cash price. Retaining the assumption of 1ppm, at off peak times, the following graph occurs:

Off peak ED premium

Now all of a sudden it is a much worse deal! Given the “normal” pricing on this route will be over £550 for Classic, the upgrade that only costs £15 is now at least £75, and often more. And at that price point – I would choose to keep the cash in my pocket and just cope with the 31” in standard seats.
For completeness, here is the graphs for when one leg is peak, and then when both are peak.

ED premium 2 and 3

At each level of cash pricing, the extra miles required because of the peak requirement means that the implied upgrade cost are lower – so at low cash prices it remains a reasonable cost to upgrade. But cash prices below £550 for Economy Classic are pretty rare to Barbados – so it remains the case the cost of moving to Delight will usually be £75 and up which is not a good deal at all.

Five important caveats –
• This all assumes that reward availability is present – which may not be the case. If you can’t use the reward seat to lower your cost of being in Classic then the analysis all falls apart and the upgrade cost returns to being £15 and a good idea.
• If you’re not comfortable valuing the miles at 1p then the graphs would be different although the direction of the lines would stay the same (technically a better way of describing it is that you are indifferent between money and miles at 1ppm but that’s by the by).
• Things will be slightly different if you aren’t travelling as a pair or other even number. The primary reason for the increased price of the upgrade is because using a companion fare to lower the price of Classic. If you are travelling with an odd number of people then at least 1 ticket cannot be part of a companion fare trick, which means that their upgrade cost will be lower, which would lower the average cost per person to move into Delight. This probably won’t matter, as lowering the upgrade cost from £100 each to £70 doesn’t change it being bad deal – but in edge cases it may lower the cost enough to make the upgrade worth doing.
• The price difference between Classic and Delight was assumed to be £100. Because you have to pay cash to be in Delight, if that gap was lowered to £80/60 that would also change the price of the upgrade, by the exact same amount that the price gap was changed.
• This analysis was done for Barbados, a medium length route for Virgin. If you are flying on a longer route, LAX, HKG for example, the extra miles are a non trivial amount that would increase the point at for which the upgrade stops being reasonably priced. Similarly, if you are only going to Boston/JFK the reduction in miles would decrease that point.

So in summary – the price reduction usually available by using a companion reward vastly increases the apparent price of the upgrade to Economy Delight to the point that rather than being the no brainer it initially appears – often you are paying far to much for the privilege. In the third and final post of the series on Virgin Companion rewards I shall look at what happens when you consider booking to the Premium cabin for the overnight flight back home.


Virgin Companion Fares. Part 1. Do they save you money?

The points, miles, and loyalty universe is full of “bait and switch” schemes. The appearance of a great deal, or a generous perk, that under close inspection turns out to be an average deal at best, and a terrible one at worst. See for example, the ridiculously large extra baggage allowances given to top tier elites, that they never use because they travel carry on only most of the time, and like most normal people, they don’t move their entire earthly possessions trans continentally on a regular basis.

A “perk” that usually falls into this category is the “companion fare”. The theory is simple – buy a cash ticket, throw in a sprinkling of miles, pay the taxes and charges and wahoo your better half can now accompany you. Except, they can’t. Not really. Not on most airlines. The bait and switch here is that usually you can’t just buy any old revenue ticket and pony up the miles. The fare classes are restricted. And by restricted it of course means you have to in the flexi-est of flexi classes, paying some absurd sum of money for an economy ticket (and if the cheapest fares are that high then award availability won’t exist for your companion of course) so you end up paying basically the same as, if not more than just buying two tickets anyway.

(As an aside, fully flex ticket prices are literally criminal. If you bought a walk up, one way, economy fare, in Y class, on British Airways for Los Angeles to London for tomorrow they would it would cost you £2,343.30 according to the ITA Matrix. If you are from LA and need a reliable person in London at short notice do let me know – I will only charge you a grand for my time and you’ll have made a stonking saving.)

However, today I bring you good news: Virgin Atlantic and their Flying Club have done a thing that does not mug you off if you buy a companion fare – in fact it can be a good deal! Especially if you just want to use miles to fly your family around in economy class for your holidays. The reason for this is that their current T and Cs on companion fares contains the following magical line: “You can save a seat onboard for a friend when you buy a full adult ticket in all booking classes, except for Economy Light and Economy Delight.” They then add in the T and Cs below that the cheapest booking classes in Premium and Upper are not in fact valid, but, but, for those of us who can stomach Economy the message is clear: if you are booked into Economy Classic – even at the cheapest booking classes, you are good to add a companion.

In a separate post I will cover the different economy flavours and some added complexity that occurred when I booked this for myself but for now, let’s assume you have decided that you and your better half are heading off on holiday, have your sights set on 2 seats in economy classic and have some Virgin miles to use: how should you go about using them?

The important detail that makes the companion fares begin to look particularly good is that they cost half, or less, of the miles that a normal award would. We are only looking at companion awards that are on Virgin’s own flights, so off peak award price for round trips are either 20k, 25k, or 30k. The companion seats in those bands are only 10k, 12.4k (why not .5? bizarre!) and 15k. At peak times the comparison becomes 40k vs 20k, 45k vs 22.4k, or 50k vs 25k.

The taxes and fees that are due on companion fares are the same due as on award seats, NOT to those on revenue fares — this is highly important as Virgin actually supresses the YQ on award tickets a fair bit e.g. LGW-Barbados the revenue YQ is £163, on awards it is only £100. Some very brief dummy searches on the Virgin website suggests that the total surcharges on award tickets on Virgin flights will be in the range £250-300, obviously each route is slightly different, but they will be in that range, so using Gatwick to Barbados for which the charges are £271 is a good middle ground.

For my analysis that follows I am just going to use the Gatwick to Barbados route – and use a valuation of 1p per mile. I also assume that any miles you receive back from purchasing cash tickets you value at 1p per mile, and are happy therefore with the logic that a £600 ticket that earns 5000 miles back only really cost you £550. The analysis does not include any consideration of Tier points, or of cashback, or Amex points or travel offers that could be used in conjunction with buying these tickets. Virgin currently has a sale on, with LGW – BGI tickets starting at £380 for Economy Light, and £460 for Classic, so it is safe to assume that getting Classic for less than £450 will be very rare.
So graph number 1: Both flights occurring on dates that are off peak for award tickets. Keep in mind throughout that these lines are only true if the 1p per mile valuation holds.

off peak companion

Two conclusions immediately stand out: Firstly, that you should never buy two tickets in Economy Classic if you have any miles to use and there is award availability! The orange line always stays below the yellow line, and the implied value you are getting for you virgin miles starts to get well above 1ppp as cash prices go up. Secondly, 2 mileage tickets aren’t going to be the best option that often. Even after the introduction of the Barbados Departure tax, outside of school holidays prices in Economy classic do spend a lot of time in the 530-600 range – a range in which it is better to only use one redemption ticket.

Next, one peak date, one off peak date. For those who squeeze around the school holidays. Mileage tickets are 10k miles more expensive each, and the companion seat is 5k more.PoP correct
Again – using a companion ticket is essentially always better than paying for two tickets with cash – and cash prices now must be even higher for using two reward seats to become the better deal than the companion fare.
Finally, the graph for 2 peak dates.peak companion

The takeaway remains the same – using a companion award ticket will be a better option than two reward seats most of the time – even for peak season Barbados cash prices over £1000 are in the minority – and if they are over £1000 then the conversation is likely moot anyway as good luck on finding two reward seats available.

Which brings us nicely to another benefit of using companion awards: you only need one seat available rather than two. Whilst not a massive game changer – on the margin it helps open up more dates to you. Lastly, as most people flying London to Barbados are not from the US of A, the smaller number of miles it uses is useful as it lowers the number you have to generate each year. To do a yearly redemption for your family of 3 or 4 at 30K miles each means you have to generate nearly 100k miles a year. Whilst this is still possible in the UK, if you don’t get many miles from flying it does require some planning and keeping on top of. Only putting together a quarter of that for two companion seats is much simpler.
Clearly the numbers won’t be the precise same for all other destinations, due to variations in surcharges and miles required, but the patterns will remain the same, and that’s the important thing. So in conclusion – Economy companion seats in Virgin present an excellent opportunity to get over 1p per point of savings compared to Economy classic tickets, and will often prove to be a better deal than doing two award redemptions. Until they restrict the booking classes..