Fears for points as Qantas considers selling part of $3b frequent flyer scheme

QANTAS has been warned it would be "crazy" to meddle with its popular frequent flyer scheme if it sells off part of the lucrative program.

QANTAS has been warned it would be "crazy" to meddle with its popular frequent flyer scheme if it sells off part of the lucrative program.

Millions of members are expected to have stockpiled points preserved if the embattled airline offloads some of the business.

But an expert said there was a risk of points being devalued to boost coffers - with or without a sale.

There is mounting speculation that Qantas is considering a partial float of the rewards scheme, which is valued at up to $3 billion.

Qantas spokesman Andrew McGinnes said no decisions had been made and "there are no plans to change the fundamental elements of the Frequent Flyer program".

The airline today revealed passengers will be slugged higher fuel surcharges for flights to Europe, Singapore, Thailand, Malaysia and the Middle East, matching partner Emirates, from January 23. It blamed continued high fuel costs and a stronger US dollar.

The sting will add $20 to $100 to a return flight cost, depending on travel class. The new surcharges range from $310 return for economy to $990 for business and first class.

Clifford Reichlin, director of online travel resource The Australian Frequent Flyer, believed there would be little consumer impact under a partial frequent flyer float given the risk of defections to rival Virgin's improved scheme and competition from foreign airlines.

"They would be crazy to jeopardise their membership base. It's one of the crown jewels of their business," Mr Reichlin said.

"They have developed one of the most advanced loyalty programs in the world with massive data about these people and a large network of partners."

The scheme boasts almost 10 million members and hundreds of partners from whom customers can earn points, including with major banks, Woolworths and Optus.

Local aviation analysts said the airline would not want to enter into any sale that would antagonise users.

"It can be sold in such a way that members and the airline are still totally protected," Strategic Aviation Solutions chairman Neil Hansford said.

"I think any change would be almost seamless for the consumer."

Mr Reichlin said the cost of taxes, fuel surcharges and other fees tacked on to rewards flights had soared in the past five years. And some credit card users now typically earned only half a point per dollar spent, rather than a full point.

The scheme had value for those who earned and used points wisely. While points burned for a weekend trip to Sydney was a likely waste compared with paying for a budget airfare, using points to upgrade to business class on a European trip, for example, could reap benefits.

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