American Airlines is raising the annual fee for two of its prominent rewards credit cards for the first time since 2018, introducing higher costs for cardholders while rolling out a series of new perks aimed at softening the blow. The changes, announced on Tuesday, reflect a broader, ongoing trend across the aviation and financial sectors as airlines and major banking partners continuously adjust their co-branded credit card programs to offset rising operational expenses and shifting consumer habits.
Under the updated pricing structure, the annual fee on the Citi AAdvantage Platinum Select World Elite Mastercard will increase to $150 per year, up significantly from its previous price of $99. According to an airline spokeswoman, this marks the first time American Airlines and its banking partner have hiked the fee on this particular card since 2018. During that previous adjustment, the fee was raised modestly from $95 to $99.
In tandem with the changes to the consumer-facing card, the Citi AAdvantage Business Mastercard is also slated for a fee increase. It will likewise now cost $150 a year for business travelers and small business owners looking to accumulate loyalty miles through their everyday company expenditures.
The decision by American Airlines to elevate its card fees is part of a wider landscape where airlines and their banking partners steadily raise rates on rewards credit cards. These specialized financial products generate billions of dollars in annual revenue for major air carriers. The core business model relies on airlines selling frequent flyer miles directly to banks, which in turn distribute those miles as rewards to consumers and corporate clients who use the cards for everyday purchases. American’s latest strategic pivot follows similar fee increases implemented by major rivals, such as United Airlines, which have also adjusted their co-branded portfolios to capture higher margins from frequent flyers.
This recalibration of loyalty economics is not limited to airlines alone; it extends across the entire premium credit card ecosystem. Major financial institutions have aggressively re-evaluated the value propositions and price tags of their flagship travel and rewards cards over the past year. In a high-profile move, American Express raised the annual fee on its immensely popular Platinum card—famed for offering extensive airport lounge access and lifestyle credits—to $895 a year, up from $695. Similarly, JPMorgan Chase increased the annual fee on its competing travel card, the Chase Sapphire Reserve, from $550 to $795. These compounding adjustments demonstrate that card issuers across the board are betting that consumers will continue to pay higher entry prices as long as the bundled perks match their travel lifestyles.
To justify the higher price point for its cardholders, American Airlines is introducing several new benefits and statement credits designed to deliver added value. Among the new perks coming to the refreshed American card are an increased earnings rate, offering three times AAdvantage miles on hotel bookings made specifically through American’s dedicated hotel portal. Additionally, the cards will now provide a credit of up to $120 every four years to cover the application fee for Global Entry or TSA PreCheck, helping travelers breeze through airport security lines. Cardholders will also receive a $100 annual statement credit applicable toward in-flight purchases, such as food and beverages, while traveling on American Airlines flights.
The newly announced fee increases and accompanying benefit enhancements are scheduled to take effect for cardholders starting January 24.
