Is it Time to transfer/withdraw points from Velocity?

[Bibendum]

Hi All,

I need some advice from the brains trust on this forum.

I, like many on here, have hundreds of thousands of points sitting with velocity. With the current COVID-19 situation and virgins financial position I’m concerned that if the airline was declare bankruptcy points may disappear..

What’s the likelihood of this happening and should I withdraw my points by purchasing gift cards to get some cash value at what I have..?

am I making a mountain out of a mole hill.. or is there a real threat to my velocity points been wiped out..?

 

[andye]

I havent been observing for 20 years but yes I assume with technological advances etc, the quality overall improves, however it really irks me when these airlines start removing services/perks/features in the intention of cost cutting

A good reason for not holding large balances.
However for those not able to generate large numbers of points per annum, the practicalities of that are harder

 

[Mr H]

A good reason for not holding large balances.
However for those not able to generate large numbers of points per annum, the practicalities of that are harder

Yes. As you say, it's important to remember that everyone has a different situation and different priorities. What may work for one person may not work for another. Just personally, I find frequent flyer programs work for me only as long as I never, ever attach a monetary value to the points. Others will swear by doing the exact opposite.

 

[jonboixxx]

I just did the 40% Velocity points transfer. So long as availability of rewards J doesn't change, I'm happy. I'm just pretty happy for a bit of a lounge and a bigger seat to spread out, watch some Netflix and relax for a couple of hours.
If I've learnt anything from you guys on AFF, it's that nothing stays the same. Don't we collect points at maximum discount to average down, allocate for value protection, plan trips early and reassess on each change of circumstances?
For instance I do about 12 BNE-CNS return per year, so it just means out VA back QF, due to the loss of the VA lounge.

 

[Mr H]

I just did the 40% Velocity points transfer. So long as availability of rewards J doesn't change...

It's a brave person who transfers from a safe haven into VA right now, especially based on an expectation that domestic J will continue to be available when it is publicly under review.

 

[jonboixxx]

It's a brave person who transfers from a safe haven into VA right now, especially based on an expectation that domestic J will continue to be available when it is publicly under review.

I understand hesitation to commit to a somewhat unknown offer, yet for me there is a lot revealed in their announcements;

-cabin configuration stays the same
-loss of one lounge in my network (CNS)
-possible change in lounge food offering, which is incidental to me. You can probably can still get a barista coffee and a poached egg, piece of toast in the morning.
-possible change of on-board catering; unknown
-I've never flown VA internationally
-I'll use all those points domestically; I'd already transferred 1M points to SQ before VA wind-up.

In essence, I think I have what I need for 12 months at a 40% reduction. And we have a competitor for the many QF flights that I take.

 

[Mr H]

In essence, I think I have what I need for 12 months at a 40% reduction. And we have a competitor for the many QF flights that I take.

Well, you now have at least enough points for 44 one-way flights in J between BNE and CNS. Enjoy.

 

[jakeseven7]

I understand hesitation to commit to a somewhat unknown offer, yet for me there is a lot revealed in their announcements;

-cabin configuration stays the same
-loss of one lounge in my network (CNS)
-possible change in lounge food offering, which is incidental to me. You can probably can still get a barista coffee and a poached egg, piece of toast in the morning.
-possible change of on-board catering; unknown
-I've never flown VA internationally
-I'll use all those points domestically; I'd already transferred 1M points to SQ before VA wind-up.

In essence, I think I have what I need for 12 months at a 40% reduction. And we have a competitor for the many QF flights that I take.

At least you bailed your points out before they collapsed!

 

[MooTime]

At least you bailed your points out before they collapsed!

Who's collapsed?

 

[RAM]

True there are still unknowns - most are driven by CV19 though. Bain, just like Q, have much more uncertainty to deal with.

For example, which international airlines will exist by the end of 2021? It is at best even money that Q will still be an international airline by the end of 2021. The writedown of the other 298 planes in their fleet, that didn't happen in the 2019/20 financial year (just the A380s from $2.0bn less depn for 19/20 & 1.1 write down to now over $600m and $20-30m on the last B747s), will likely wipe out Q's shareholders' equity which is effectively just what they raised in 26 June 20 & $77m from the failed retail offer of $500m.

The latest on VFF points is that they are fully cash backed. We have not been notified of any potential changes to the trust deed covering VFF points - so that should remain the case.

QFF points on the other hand are not cash backed.

With Q taking 19+ weeks (in some AFF cases) to finally refund Q cancelled flights - I know which points I think are more at risk.

That said, if someone already has a substantial (to them) VFF balance, it doesn't hurt to take 'baby steps' with offers such as the current one. Just like with the stockmarket - buying straw hats in winter is always the better option.

Bain/VA have a blank sheet, no $600m in fuel hedging losses to clear, no grounded international fleet worth 65% of total tangible assets, not having one of the oldest fleets in the world (14+yrs, and the Q A380s are 10-12yrs old so Q operational fleet is colser to 15 yrs = much higher costs/lower reliability), don't have 2,000,000 sqm of long term property leases around the world - mostly on airport.

Gvien that Bain bought VA in the midst of CV, not before it, makes me much more confident on the relative value of VFF vs QFF points. Time to do the last redemptions for Lord Howe return I think.

 

[serfty]

Who's collapsed?

I suspect "collapsed" could be replaced with "stopped transfers to KrisFlyer".

 

[jakeseven7]

I suspect "collapsed" could be replaced with "stopped transfers to KrisFlyer".

Thank you....

Yes, when VA1 collapsed the transfer to SQ was cut off, so the OP was lucky they got their points out in time.

 

[Mr H]

... makes me much more confident on the relative value of VFF vs QFF points.

Nobody can foresee the future with 100% certainty, and everyone has different priorities.

For the time being, at least, QFF points can be redeemed on international One World routes whereas VA can be redeemed only on a select range of domestic routes. If we take value as being a function of risk and reward, I still value a risky chance of a big reward over a more certain reward that I don't really want. All this would change in an instant, of course, if VA joins a major alliance and QF crashes out of OW.

Incidentally, prior to the crisis, I valued VA much more highly than QF because of the access to *A through SQ.

 

[andye]

Will be intesting if there is any buyer's regret from those who cashed out for giftcards etc

 

[Mr H]

Will be intesting if there is any buyer's regret from those who cashed out for giftcards etc

I doubt anyone would admit to it. But hindsight is always a wonderful thing - anyone who feels regret should remind themselves of the arguments they made at the time, based on the information available, and be satisfied that they would make the same decision again in the same circumstances.

 

[SOPOOR]

I doubt anyone would admit to it. But hindsight is always a wonderful thing - anyone who feels regret should remind themselves of the arguments they made at the time, based on the information available, and be satisfied that they would make the same decision again in the same circumstances.

I cashed out my almost 7 digit points for jb hifi cards. Still haven't used them because I don't really need anything.

If the flight availability and points requirements go back to pre covid with this new group, I would prefer to have kept them, since they dontexpire,
Not something I would regret doing, but the chance I could have lost all of them worth $1000s, would have been a regrettable outcome. So I dont feel like I lost out
Almost like the best of a bad situation type

 

[jakeseven7]

Will be intesting if there is any buyer's regret from those who cashed out for giftcards etc

I evacuated most of mine to SQ before VA1 shut Velocity down and used the remainder for gift cards and could not care less, bought some people some lovely birthday gifts

Bain/VA2 are going to be very hard for my business to use with the cutbacks so I expect we will probably be switching to QF flying mostly anyway.

 

[RAM]

Nobody's perfect - no matter what the politicians may say.

Just like some people are happy to punt on penny dreadfuls in the stock market while others can't sleep at night worrying. You make the decision that's right for you at the time & move on.

Hopefully learning as much from the mistakes as when you get the decisions right.

Some choose to hope for the best while preparing for the worst. Pre-CV we had managed to redeem our VFFs for around 6 cents value on my figuring (cheapest available revenue ticket on day reward seat booked, adjusted for all cash charges etc). We were in the relatively happy position of transferring enough for 1st to NY over to Krisflyer the day before the devaluation in transfer rates came in, and had redeemed a swag just before the EY new charges began.

Our figuring was that as we'd not paid for any of our points (free trip on Amex offset cost on only fee-charging card), then we'd already had several major wins at the FF casino, so we'd let the March balance ride & hope for a 3rd win on the roulette wheel. So far its looking promising that we'll get more than the GC redemption option.

 

[MooTime]

I evacuated most of mine to SQ before VA1 shut Velocity down and used the remainder for gift cards and could not care less, bought some people some lovely birthday gifts

Bain/VA2 are going to be very hard for my business to use with the cutbacks so I expect we will probably be switching to QF flying mostly anyway.

What cutbacks??

couple lounges gone along with a chocolate chewy muesli chip packet in Y no longer, as if it was ever required anyway.
couple regional routes gonski, which looks like they'll alliance them them now anyway so possibly no loss there.
VARA staying.
J still under review, but I think it's safe to say as others have posted it'll remain close to as is.
Velocity staying as is, status levels staying as is.
I think we're very fortunate we still have Virgin as another option carrier. Could've easily left the landscape altogether.

I really fail to see much of a difference. I guess these forums are to nit pick & point out any changes for all to see. I respect that view.

Mid-tier airline, many would argue that's what they always were all along.

What do you see as the biggest loss over this Vol-Admin, VA2 process.

I think it's fantastic we here in Oz have Jetstar, Virgin & Qantas, 3 levels of service & cost. How accommodating is that for all the masses.
Yes Rex too soon.

 

[Bagpuss]

What cutbacks??

couple lounges gone along with a chocolate chewy muesli chip packet in Y no longer, as if it was ever required anyway.
couple regional routes gonski, which looks like they'll alliance them them now anyway so possibly no loss there.
VARA staying.
J still under review, but I think it's safe to say as others have posted it'll remain close to as is.
Velocity staying as is, status levels staying as is.
I think we're very fortunate we still have Virgin as another option carrier. Could've easily left the landscape altogether.

I agree, I dont think the demise of Virgin is going to happen. They will have to regain some trust from people.
Virgin Australia was originally buy on board and it worked for them then, so why wouldn't it now.
I expect they will also do similar to Qantas and allow 1 flight to be booked to maintain status (as annouced today). The caveat with Virign maybe that the 1 or 2 flights need to be booked without any future fund credits, though that would go down VERY poorly.

 

[AIRwin]

Virgin Australia was originally buy on board and it worked for them then, so why wouldn't it now.

Higher expectations now?