2. Therefore, we would need more information about what sort of churning options are available to Canadian credit card customers. Each credit card market is different and I don't have enough information on the Canadian market to know what's going on there.
Fellow Canuck who can answer that question, I reckon. There are a number of banks in Canada that offer Aeroplan co-branded credit cards including AmEx, CIBC, TD (
full rundown here). Some of these cards have relatively low annual fees and decent sign up bonuses. For instance, I'm on the TD
Aeroplan Visa Infinite card (grandfathered in from the old General Motors card) and the current sign up bonus is 50,000 bonus miles for a $139 annual fee. Between those three banks there are plenty of churning opportunities I reckon, especially considering these banks also offer business versions of the card too, and at least in Canada it's relatively trivial to set up a company.
3. There is no way this is coming to the Australian market absent some large change in circumstances. The selling of frequent flyer points is one of the most profitable parts of an airline. The airlines never lose out in this equation because the more points they sell, the more money they make. They can, of course, lose out in other ways eg by not having enough redemption opportunities, but they can be managed by releasing more redemption opportunities, etc.
In terms of credit cards, I think you are correct here. As it stands there are no Australian credit cards I'm aware of that are co-branded with Aeroplan, and frankly it wouldn't make sense, like Air Canada has three flights a day to Australia (2 to Sydney and 1 to Brisbane). US is a completely different market, remember the world's largest border is between Canada and the US. As a Canadian Nexus card holder I can enter the US without a passport and without having to speak with a border officer. Back when I lived in Canada, crossing into Michigan from Ontario was as much a big deal as someone living in South Australia crossing into Victoria every day. Cross-border air travel is huge, Air Canada has tons of flights between US cities meaning the opportunities to book flights with Air Canada either to Canada or via Canada to say Europe or Asia is huge. Remember too that the benefit of the co-branded card isn't just the points accumulation but also the Air Canada specific perks like free checked bags and access to the Maple Leaf Lounge along with the possibility of earning Aeroplan status partially through credit card spend.
In terms of credit cards which have Aeroplan as a transfer partner in Australia, I'm unaware of any. AmEx AU seems to have focused their attention on the usual suspects Aussies are aware of here: KrisFlyer, Velocity, and the big red Kangaroo! That being said, it's still possible to buy points directly from Aeroplan which can be beneficial when they are running a sale. Remember, non-Canadian residents don't have to pay sales tax (i.e. Canadian GST/PST/HST or AU GST).
Where I do disagree is the statement you make where you say the selling of frequent flyer points is one of the most profitable parts of an airline. I think the answer from my experience is it depends. If you use those Aeroplan points to book anytime awards with Air Canada, say Sydney to Vancouver for half a million points to be booked into business on Aeroplan, then yeah they are likely coming out ahead. On the other hand, if you end up buying/transferring 220,000 miles to Aeroplan and then proceed to book a round the world ticket with Aeroplan in business I would make the argument that you are coming out ahead on the transaction, especially if most or all of the flights are operated with quality partner airlines like EVA Air, Etihad, TAP Portugal and Asiana.
4. Australian banks are unlikely to impose such requirements on airlines because they have other ways of limiting churning, as mentioned in the article. They can simply up the time between applications or apply more stringent credit checks on new customers who have a history of churning.
That's correct and frankly gaming of credit cards is something banks need to deal with themselves. There are tons of gamers out there who use things like manufactured spend to "beat" the house. I know with AmEx if you pull some of those stunts your account gets suspended and you have to go through an arduous financial review process to have any chance of getting your card back.
Speaking of the Australian market specifically, it's a totally different market. Frankly, having lived here for a couple years now credit cards aren't a thing like they are elsewhere. Many stores won't accept AmEx. Those that do accept Visa or Mastercard will hit you with a surcharge for using the payment method thereby negating much of the points value you are earning. Contrast this with the US, Canada and the UK where you can use any major card virtually anywhere and there are no additional fees for using that payment method. The credit card markets are also a lot more mature there too. For instance, as a student visa holder I could pick up an AmEx Gold card in the UK no problem, whereas here I need to be a permanent resident to get an AU issued credit card.
4. This will likely come back to hurt Air Canada. By restricting the number of points Canadian customers can acquire, they are hurting their most loyal customers and making it easier for Americans to swoop in and scoop up award seats. Americans can acquire hundreds of thousands of Aeroplan points at little cost through Amex, Capital One and Chase, which all transfer at a 1:1 rate. And this option is widely published in American blogs as being one of the best transfer partners with their generous reward partners/rates.
I don't know how many gamers there are in Canada. I reckon the number is relatively small and most folks by now have already played the game with signing up to the various Aeroplan credit cards back when AC was ushering in those new cards late last year and earlier this year.
5. A minor correction. The Chase 5/24 counts the number of personal cards opened, not applied for.
Correct, and different banks in the US have different rules. Hence, it's not uncommon for many travel enthusiast in the US to hold dozens of credit cards to maximize the benefits. For instance, I've go the Canadian AmEx Marriott card, it's got a $120/year annual fee but I get a free night certificate every year valid for a 35,000 point redemption. In other words a classic keeper card.
-RooFlyer88
www.australianfrequentflyer.com.au
