What Will Happen to US Airways Card Accounts During Merger: Evidence from the Recent Discontinuance of the Barclay’s Virgin America Card

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US Airways and American Airlines have merged. Citi will be the issuer of the credit card for the combined New American Airlines. Barclaycard, which currently issues the US Airways Premier World MasterCard will at some point in the very near future have to discontinue the card.

For that reason, I’ve recommended that people who want to get a new card get the US Airways Premier World MasterCard with 30,000 US Airways miles after first purchase before it disappears and the chance to earn the miles disappears with it. You can either use the miles on US Airways’ current incredible award chart or have the miles converted to American Airlines miles during the integration of the airlines.

Since so many MileValue readers have gotten the US Airways Premier World MasterCard in anticipation of its disappearance, I’ve gotten a lot of questions about what will happen to cardholders’ accounts when the card disappears.

Barclaycard hasn’t told us yet, but I have a strong guess based on the recent history of the demise of another co-branded Barclaycard: the Virgin America card.

What happened to the accounts of Virgin America cardholders when Barclaycard discontinued the card? What should you do if you have a US Airways Premier World MasterCard? What are your options?

Barclaycard had the contract to issue the Virgin America card. For reasons unknown, that deal ended, and Barclaycard stopped issuing the card. (For a few months, no one issued the card, and today Comenity Capital Bank relaunched the card.)

But Barclaycard had a problem. It wasn’t enough to just stop new applications for the Virgin America card, they had to discontinue the Virgin America cards of everyone who already had one.

How Barclaycard Handled Existing Virgin America Cards

Barclaycard sent cardholders letters saying about 60 days in advance, telling cardholders that their cards would be converted to the Barclaycard Arrival(TM) World MasterCard® on January 1, 2014.

Here is a picture of the letter sent to one person.

The letter explains that cardholders “don’t have to do anything” and that their cards would eventually stop earning Virgin America miles and start earning Arrival miles.

The posted letter even included a kind of retention bonus that if the cardholder spent $1,000 in the first 90 days of having the Arrival card, he’d get 10k bonus Arrival miles. Not all posters mentioned being offered such a bonus.

There were annual-fee and no-annual-fee versions of the Virgin America card, and they were converted to the annual-fee and no-annual-fee version of the Arrival card respectively. Those who had the annual-fee version were given a 12 month waiver on the annual fee.

Here is the full FlyerTalk thread on the conversion. Reports of the conversion start around post 110.

What to Expect from the US Airways Card Conversion

Based on how Barclaycard handled the Virgin America card’s demise, here’s what I expect:

  1. In the next few weeks, Barclaycard will stop accepting applications for the US Airways Premier World MasterCard.
  2. At some point after that, letters will go out to existing cardholders telling them that their cards will be converted to the Barclaycard Arrival(TM) World MasterCard® (the one with an annual fee) on a specified future date.
  3. Until that date, the US Airways Premier World MasterCard will continue to earn US Airways Dividend miles.
  4. After that date, even if you are still physically using a card that US Airways, it will earn Arrival miles.
  5. We will get new Arrival cards in the mail.
  6. We may be given some sort of retention bonus tied to spending to get us used to using the Arrival card. We may get an annual fee waiver for the first year of holding the Arrival card.

I don’t have any guesses about what will happen if you already have a US Airways Premier World MasterCard and a Barclaycard Arrival(TM) World MasterCard®.

What You Should Do If You Have a US Airways Card

I have a US Airways card. Here’s what I’m going to do.

First, I’ll wait for an actual announcement from Barclaycard. It’s fun to speculate and plan now, but no need to go overboard before I know whether my guesses are right.

If the conversion is as I expect (see above), I will cancel my US Airways card before it is converted to an Arrival card.

If my card is converted to a Barclaycard Arrival(TM) World MasterCard®, I will probably lose my opportunity to apply for the card and earn its 40,000 bonus miles after spending $1k in the first three months, which is worth $444 in free flights on any airline with no blackouts.

So I would rather apply separately for the Arrival card with my next set of applications than have my US Airways card turned into an Arrival card.

An alternative plan to cancelling the US Airways card would be to try to convert it to another card besides the Barclaycard Arrival(TM) World MasterCard®. Unfortunately, that’s not likely to work if history is a guide.

Rapid Travel Chai tried to convert his Virgin America card to any other card besides the Arrival card, and Barclaycard wouldn’t let him.

My Advice Regarding the US Airways Card, Distilled

If you don’t have the US Airways Premier World MasterCard, and you’re in the market for a rewards card, get it as soon as possible. Don’t be the one kicking yourself for missing out on these bonus miles before they disappear.

Offer details:

  • Earn up to 40,000 bonus miles with qualifying transactions
  • Exclusive: Book award flights for 5,000 fewer miles – award travel starts at just 20,000 miles for cardmembers
  • Zone 2 boarding on all US Airways flights
  • Earn 2 miles per $1 on US Airways purchases
  • Earn 1 mile per $1 on purchases everywhere else
  • Annual companion certificate good for up to 2 companion tickets at $99 each, plus taxes and fees
  • First Class check-in
  • Please see terms and conditions for complete details

Application Link: US Airways Premier World MasterCard

If you do have the card, sit tight, and wait for a letter telling you it will be converted to another type of card. When that comes, carefully consider whether you want the card converted or whether you want to cancel it to preserve your ability to get the card it would have become with its full sign up bonus.

Hat Tip Rapid Travel Chai



Editorial Disclaimer: The editorial content is not provided or commissioned by the credit card issuers. Opinions expressed here are author’s alone, not those of the credit card issuers, and have not been reviewed, approved or otherwise endorsed by the credit card issuers.

The comments section below is not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved, or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all questions are answered.

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22 COMMENTS

  1. I got approved for the 35k version last night. This is my second US Airways card. The anniversary miles for my first one should post in February. I also picked up the AA 50k MC and AMEX Delta Platinum (need MQD waiver). Pretty good AOR by my standards.

  2. I am confused. I recently applied for the US Airways MasterCard. The front of the card I received shows Platinum on the right side. The picture of the card showing on your blog shows Premier World on the right side. Is there a difference?

    • @L.Low – I think this is a recent naming change. The card I got in Feb 2013 says Platinum as well. When I first saw my Premier World approval I thought I was approved for a lesser card, but that appears to more be the “top” Barclays MasterCard.

  3. Tried getting the US Air business version a couple of weeks ago and finally got the denial letter. Anyone have a good number for recon for a Barclays business card? My business spend is considerable ($350K to $450K per year) and I carry no debt besides a small car loan. Credit score was listed as 785 according to the denial letter. Barclays might just hate me.

  4. What happened to BofAm’s Virgin Atlantic MasterCard? I cannot really find it anywhere on the blogs. My wife’s BofAm Amex card was converted to the one I am asking about.

  5. I have the US Airways Mastercard and annual fee will be assessed on 1/31/14. I also have the Arrival card. Should I cancel the US Air card before the end of the month in order to avaoid paying the annual fee for a card which will probably be eliminated?

    • Because the two airlines have merged. It’s hard to pinpoint my exact difference of views with Gary because I offered a friendly and public wager to see exactly where we stand and he hasn’t taken me up on the offer. (And yes, I know a few things he doesn’t. For instance, I doubt he knows who won the 2003 VHSL Class A Boy’s Tennis Championship. 😉 )

    • To me, this adds just about zero information. What would you expect Barclaycard to say in an email if the card would no longer be accepting new applications from April 1 for instance? I’d expect it to say just about what that said. Time will tell.

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