British Airways & American Express Partnership Extended

British Airways’ partnership with American Express has been extended in a new multi-year deal announced by its parent company IAG.

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British Airways First Class Cabin (Image Credit: British Airways)
British Airways First Class Cabin (Image Credit: British Airways)

British Airways’ partnership with American Express has been extended in a new multi-year deal announced by its parent company International Airlines Group.

American Express issues BA branded credit cards through which members can earn Avios points.

BA’s parent company, IAG, has announced that it has signed a new multiyear deal with American Express.

This operated through a separate division of IAG known as IAG Loyalty. As part of this, American Express will pay IAG £750m which is primarily a pre-payment for Avios points it will issue to members.

IAG CEO Willie Walsh did state during its full year results announcement that he had met with Mastercard a few times and they were “mad keen” to do business with IAG. This was no doubt a signal to American Express.

The advance sale of frequent flyer points to third parties is a device airlines use to raise funds. In 2009, American Airlines pre-sold $1 billion of AAdvantage miles to Citigroup. This comes at a time when airlines seek more ways to raise cash by using intangible assets. Yesterday, American Airlines announced it had taken out a $1.2 billion loan that was secured against its trademark and the internet domain name aa.com

IAG is due to announce its half-year results on Friday 31 July and will provide a further update on its finance raising plans then.

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