Frequent flyers have bemoaned how airport lounges, once a beloved oasis for weary travelers, are becoming increasingly overcrowded.
Now, it seems American Express
AXP,
may be trying to tackle the issue through a key change to its premium Platinum Card program, but one that will hit some users in the wallet.
Amex charges an annual $695 fee for the card, which includes access to more than 1,400 airport lounges worldwide through various partners. But it also gives that same access to the authorized users added by cardholders to their accounts.
Previously, Amex charged cardholders $175 annually for up to three additional users. But Amex recently announced that cardholders will now have to pony up $195 for each person.
While the change could potentially boost Amex’s bottom line, some who track the credit-card and travel landscape say it’s all about addressing the lounge situation.
“Previously, Amex charged cardholders $175 annually for up to three additional users. But Amex recently announced that cardholders will now have to pony up $195 for each person. ”
Lounges have become much less inviting in recent years because of the surging demand for them, say travelers. There are often long lines to get into a lounge, and the experience inside can be less than that of the pampered perfection people have come to expect.
“It’s horrible,” said Adam Levy, a veteran globetrotter who runs wine, spirits and beer competitions worldwide. Levy, who’s a Platinum cardholder, said 30-minute lounge wait times have become the norm.
By raising the cost to add users to a Platinum account, Amex could deter existing primary cardholders from continuing to do so, experts note. Plus, new primary cardholders may balk at the price for the add-ons and decide not to extend their benefits to others.
In turn, with fewer Platinum add-ons, lounges may end up being less busy. Which might appease Platinum cardholders who particularly value this perk, to say nothing of travelers in general.
Or as Kyle Potter, executive editor of the Thrifty Traveler website, said of the current lounge situation: “There are so many people trying to use these benefits that it doesn’t feel like a benefit at all.”
An Amex spokesperson declined to comment about whether the recent price hike was related to the lounge issue. But the spokesperson said of the hike, “Over the past several years we’ve added significant value to the Platinum Card. When we refreshed the Card in 2021, the fee for the primary card increased [from $550 to the current $695], but we did not increase the fee for the additional Platinum Card.”
The spokesperson added that the annual benefits of the card are worth more than $1,500, noting they go beyond lounge access to also include everything from a $100 statement credit to offset the cost of applying for the Global Entry program to gold-status qualification in the Hilton Honors loyalty program.
““There are so many people trying to use these benefits that it doesn’t feel like a benefit at all.””
Nick Ewen, content director for The Points Guy, a popular travel website, said it wouldn’t surprise him if Amex’s decision to raise the fee for adding users to a Platinum account was part of an effort to ease lounge overcrowding. A Platinum cardholder himself, Ewen added that he has been unable to get into some lounges upon occasion.
But Ewen also said if this is indeed Amex’s strategy, he’s not sure how much of an impact it will have.
Specifically, Ewen is not convinced all the add-on Platinum people have been heavy lounge users. Rather, he thinks they are more likely individuals who take advantage of the benefit as a nice occasional perk — say, two or three times a year.
By contrast, Ewen said those add-ons who are “power lounge users” will want the access no matter what — meaning any extra cost is a relatively insignificant matter.
Potter of Thrifty Travel said that Amex has likely looked at the data concerning lounge use among its Platinum cardholders and sees this as a solution to the overcrowding issue.
“I think it’s safe to say by making this kind of change, they might be able to make a dent in the problem,” he said.
Still, it’s not as if those who want lounge access via a credit-card program don’t have other options. In particular, the Chase
JPM,
Sapphire Reserve card ($550 annual fee, plus $75 for each additional user) and Capitol One
COF,
Venture X card ($395 annual fee, with no charge for additional users) provide lounge benefits.
And even those without any of these travel cards can access lounges in other ways. They can pay a daily fee or buy a membership directly into lounge programs, such as Priority Pass.
Ewen said Amex Platinum cardholders need to do the math and see if paying for authorized users is worth it versus other options, at least as far as lounge access is concerned. (Again, the Platinum Card offers other benefits to add-on users.)
Ewen added that he will be wrestling with this very issue since his wife and other family members are authorized users on his Platinum account.
“I’m going to have to crunch the numbers,” he said.
This story originally appeared on Marketwatch
