British Airways Devalues Nectar Conversions – What Comes Next?

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British Airways Executive Club has decided to devalue the Avios to Nectar conversion rate. The rate of exchange FROM Nectar to Avios will remain unchanged.

At the moment – and until 16 November, 2022 – you can convert 250 Avios into 400 Nectar points. Because Nectar points have a fixed value of 0.5p each, that meant an Avios always had a floor value of 0.8p.

From 16 November, 2022 the conversion rate changes to 300 Avios = 400 Nectar points. In other words, 0.67p per Avios.

You will still be able to convert 400 Nectar points into 250 Avios – that does NOT change.

Instead of being able to move Avios back and forth without penalty, therefore, you will now destroy value if you move your Avios to Nectar but then change your mind later.

What Can I Do About it?

You might want to move 50,000 Avios – the monthly maximum – to Nectar.

There is no downside to doing this. If you change your mind in weeks or months, those 80,000 Nectar points will still get you 50,000 Avios or £400 off your shopping. (unless Sainsburys throws their toys out of the pram and also devalues, but without notice…)

You might also want to switch off “auto-convert” and hoard your Nectar points until we have more clarity about BA’s longer-term intentions.

What Other Bad News is Coming?

We have already seen Iberia leak the news that British Airways is moving to revenue-based Avios earning. (click here for details)

We have also seen British Airways launch a subscription service with suspiciously low pricing. (click here for details)

Could something also be coming on the award chart side? There is little doubt that Executive Club members would have rushed to cash out as Nectar points if award charts were to be devalued substantially. Once the Nectar option is gone, BA’s flexibility to devalue certainly increases. – maybe we will finally see the much-threatened “dynamic award pricing”…

Bottom Line

It is hard to mourn a redemption option that has only been available for ~2 years. Especially one that most Avios gurus would shun in favour of a higher value redemption.

But I suspect that many readers will be fearing even worse news coming along…  What do you think? Let us know in the comments section…


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