AGR Credit Card change (October 2022)

[dlagrua]

Another thing to consider (and this is pure speculation with no basis in any specific information from the people in the know) is that perhaps Amtrak is not interested in having people rack up big AGR point accounts from using the credit card that they can then use to buy free sleeper rides. I'm not sure how AGR redemptions are accounted for in the financial performance of the trains, but Amtrak may now be in a situation where the sleepers are selling out, and they may prefer to have them filled with people paying cash, not redeeming AGR points. Thus, they may be focusing AGR more on frequent riders who make redemptions on shorter train rides on trains that are not getting sold out. I wonder if we'll start seeing blackout dates and such too. Of course, if business slacks off, the terms of AGR could become more generous again. After all, AGR is a marketing tool, not a social policy designed to let people of moderate means afford to make circle trips around the US in sleepers.

Amtrak makes money on trips booked with points. They are not free trips at all. Each point has a cash value of .028 . That is accrued just like any other credit card rebate but paid to you in points that you pay to Amtrak when you purchase. What benefit would the AGR program be to Amtrak, if it doesn't add revenue to the bottom line?

 

[PaTrainFan]

Another thing to consider (and this is pure speculation with no basis in any specific information from the people in the know) is that perhaps Amtrak is not interested in having people rack up big AGR point accounts from using the credit card that they can then use to buy free sleeper rides. I'm not sure how AGR redemptions are accounted for in the financial performance of the trains, but Amtrak may now be in a situation where the sleepers are selling out, and they may prefer to have them filled with people paying cash, not redeeming AGR points. Thus, they may be focusing AGR more on frequent riders who make redemptions on shorter train rides on trains that are not getting sold out. I wonder if we'll start seeing blackout dates and such too. Of course, if business slacks off, the terms of AGR could become more generous again. After all, AGR is a marketing tool, not a social policy designed to let people of moderate means afford to make circle trips around the US in sleepers.

This, unfortunately, may very well be the answer.

 

[jebr]

Amtrak makes money on trips booked with points. They are not free trips at all. Each point has a cash value of .028 . That is accrued just like any other credit card rebate and paid to you in points that you pay to Amtrak when you purchase. What benefit would the AGR program be to Amtrak, if it doesn't add revenue to the bottom line?

Amtrak certainly makes some money on selling AGR points to BoA, and any future card would almost certainly be similar. However, I highly doubt BoA (or any future credit card issuer) pays 2.8 cents to Amtrak for every point they purchase/issue. For other cards it's speculated that the purchase price of points by credit card issuers is around a penny per point - and based on the earnings rate, I'd guess that's in the ballpark for what BoA pays for AGR points as well.

My guess is that we'll see either AGR points become devalued further, earning rates go down on a new card, or both. Long-term it's likely unsustainable for Amtrak to sell trips at basically half price just because AGR points earned through credit cards were used. I wouldn't be surprised if they offset some of it by increasing earnings on riding with Amtrak - likely aligning with many major US airlines that offer 5 points per dollar spent on travel (but with those points being worth roughly half of what AGR points are worth.)

 

[jebr]

Another thing to consider (and this is pure speculation with no basis in any specific information from the people in the know) is that perhaps Amtrak is not interested in having people rack up big AGR point accounts from using the credit card that they can then use to buy free sleeper rides. I'm not sure how AGR redemptions are accounted for in the financial performance of the trains, but Amtrak may now be in a situation where the sleepers are selling out, and they may prefer to have them filled with people paying cash, not redeeming AGR points. Thus, they may be focusing AGR more on frequent riders who make redemptions on shorter train rides on trains that are not getting sold out. I wonder if we'll start seeing blackout dates and such too. Of course, if business slacks off, the terms of AGR could become more generous again. After all, AGR is a marketing tool, not a social policy designed to let people of moderate means afford to make circle trips around the US in sleepers.

Kind of reiterating on my last point (but expanding on it) - I would be surprised if Amtrak gives up the credit card point gravy train entirely. It's simply too lucrative - the banks pay Amtrak for the AGR points issued, and people are likely more willing to part with a large points balance than pay a very high sleeper fare. It's quite possible that fares are high because Amtrak was able to sell a lot of rooms with AGR points at those higher fares - which may still have more value to Amtrak's bottom line than a low bucket fare paid with cash instead of points.

That said, I will be surprised if there isn't some sort of significant downgrade in the value of AGR points within the next couple of years, particularly on the sleeper side of the equation. NEC riders already have had a quiet devaluation with Amtrak putting multiple buckets on the NER and Acela trains within the saver category (not eligible for redemptions,) thus inflating the cost of redemptions even on quiet days/trains. There's also been a small drop in value of a point for redemption across the board (from 2.89 cents to 2.81 cents.) I'd tend to agree that the current redemption situation on sleepers in particular is unsustainable, but I'm curious how Amtrak will try to rectify that.

 

[joelkfla]

Amtrak makes money on trips booked with points. They are not free trips at all. Each point has a cash value of .028 .

It's effectively about $0.025 in practice, because I think most people savvy enough to get the card are probably eligible for some sort of discount (at least RPA, if nothing else), and points are charged at full fare without discount.

 

[NorthShore]

In practice, I'm already at a point (no pun intended) where I'd like to use accumulated points for a long distance roomette, then refocus on annual earnings for shorter daytrip redemptions going forward from there. Since I'm in Chicago, such is a reasonable and practical possibility with lots of routes I might take for that sort of riding benefit program. But, if one's origination station is a lot of other places in the country...not so much.

 

[dlagrua]

It's effectively about $0.025 in practice, because I think most people savvy enough to get the card are probably eligible for some sort of discount (at least RPA, if nothing else), and points are charged at full fare without discount.

Another item would be that if you use points you always pay at the highest bucket price so if in fact the points are purchased by BoA say at half price it would seem that Amtrak still makes money. Another thing to consider is that many people use points for extra trips that they may not take otherwise for cash.

 

[Joe from PA]

I have the card. I'll chime in when I receive a communication.

 

[AmtrakBlue]

I have the card. I'll chime in when I receive a communication.

I expect to hear the Bells of St Mary when something comes out. Everybody will be posting...

 

[gregg_vw]

My BOA AGR card renews in August. I dont know if I should go ahead and downgrade it to a fee free card or renew it one more time. Once AGR is no longer associated with the account, it would be helpful to know what BOA will offer account holders in an attempt to retain our business.

 

[jebr]

I expect to hear the Bells of St Mary when something comes out. Everybody will be posting...

The admins better have the quarters ready to keep the server running when everyone rushes over after the announcement!

 

[joelkfla]

My BOA AGR card renews in August. I dont know if I should go ahead and downgrade it to a fee free card or renew it one more time. Once AGR is no longer associated with the account, it would be helpful to know what BOA will offer account holders in an attempt to retain our business.

It would be really nasty for BoA to charge an annual fee when they know it's going away in a month. I doubt they will be willing to switch the card to the no-fee version, when that's no longer an offering.

I'm also planning to cancel after my points for this month's ticket purchases show up on AGR. I called BoA, and the rep said the annual fee would be refundable if there were no new charges after it was assessed, but I'm not sure I trust BoA on that.

 

[TinCan782]

My BOA AGR card renews in August. I dont know if I should go ahead and downgrade it to a fee free card or renew it one more time. Once AGR is no longer associated with the account, it would be helpful to know what BOA will offer account holders in an attempt to retain our business.

Mine expires in December. Doesn't matter. When AGR is fully separated from BofA, your current card will simply become an equivalent non-branded BofA credit card. BTW, You will then need to obtain (by whatever process is announced) the new AGR credit card from the yet to be announced financial institution.

 

[NEC User]

So another question regarding the end of the BoA card.

As I understand it from this thread, BoA will not be posting any rewards after 9/30/2022.

1) So does that mean that no points can be accumulated until people have applied for and received their new AGR credit card? So no points for purchases/travel after 9/30/2022 (say Oct, Nov...) until new credit card obtained?

2) What about points for purchases/travel before 9/30/2022? For instance, my account bills on the 7th of the month and reflects activity for the prior month. So any purchases/travel that occurs in Sept that would otherwise be posted in October would also not be posted? It seems to me that the impact to many people could be as early as 9/1/2022.

Thoughts?

 

[TinCan782]

So another question regarding the end of the BoA card.

As I understand it from this thread, BoA will not be posting any rewards after 9/30/2022.

1) So does that mean that no points can be accumulated until people have applied for and received their new AGR credit card? So no points for purchases/travel after 9/30/2022 (say Oct, Nov...) until new credit card obtained?

2) What about points for purchases/travel before 9/30/2022? For instance, my account bills on the 7th of the month and reflects activity for the prior month. So any purchases/travel that occurs in Sept that would otherwise be posted in October would also not be posted? It seems to me that the impact to many people could be as early as 9/1/2022.

Thoughts?

BofA posts points for purchases at the time of purchase and they appear on the following statement. I'm sure any such transactions made prior to whatever the cutoff date is, will be ok even if the purchase falls between the program cutoff date (whatever date is) and the monthly statement date.
I myself, am not too concerned about the transistion. Went through that before when AGR went from Chase to BofA. I don't recall any problems (at least with my account).

 

[jebr]

So another question regarding the end of the BoA card.

As I understand it from this thread, BoA will not be posting any rewards after 9/30/2022.

1) So does that mean that no points can be accumulated until people have applied for and received their new AGR credit card? So no points for purchases/travel after 9/30/2022 (say Oct, Nov...) until new credit card obtained?

2) What about points for purchases/travel before 9/30/2022? For instance, my account bills on the 7th of the month and reflects activity for the prior month. So any purchases/travel that occurs in Sept that would otherwise be posted in October would also not be posted? It seems to me that the impact to many people could be as early as 9/1/2022.

Thoughts?

At this point it's anybody's guess as to what will happen. Neither AGR or BoA have stated anything in regards to whether or not a transition will happen yet. I would expect at least one billing cycle notice of any changes and how exactly points will be issued for transactions. But until there's an announcement or more definite and detailed leaks posted online, we can only speculate as to how the cutoff and transition will be handled.

 

[Old MM]

If Amtrak is trying to pivot away from people accumulating AGR points on that card, I sure don't get some of the recent marketing push that we discussed a while back. Maybe there was money to be made with all the partner arrangements - hotels, cars, wines,flowers, other online shopping, etc. I can't imagine using the points for anything but travel, probably similar to many on this forum. It's possible a certain percentage of riders have health reasons for avoiding group transportation given that pandemic protections are no longer required. This segment of AGR credit card users might be quite content to redeem points for these other categories of purchases, which of course have some type of revenue sharing agreement with the merchants as well as Amtrak and BOA. So if that market segment was becoming more profitable, at least in the short term, driving usage to the current card would make sense. We arrive at the same conclusion regardless... wait and see.

 

[TinCan782]

If Amtrak is trying to pivot away from people accumulating AGR points on that card, I sure don't get some of the recent marketing push that we discussed a while back. Maybe there was money to be made with all the partner arrangements - hotels, cars, wines,flowers, other online shopping, etc. I can't imagine using the points for anything but travel, probably similar to many on this forum. It's possible a certain percentage of riders have health reasons for avoiding group transportation given that pandemic protections are no longer required. This segment of AGR credit card users might be quite content to redeem points for these other categories of purchases, which of course have some type of revenue sharing agreement with the merchants as well as Amtrak and BOA. So if that market segment was becoming more profitable, at least in the short term, driving usage to the current card would make sense. We arrive at the same conclusion regardless... wait and see.

Yes. There have been two recent bonus point programs (4,000 points each) recently for use of the card.

 

[dlagrua]

My point of view on this is that the AGR program makes money for Amtrak and contributes to fare revenue. Its reasonable to believe that the program will continue. My concern is that a new credit card may not give the one point per dollar spent in the value of .028. Its possible that the points will be devalued but we shall see.

 

[Amtrakfflyer]

Yes, those things surprised me too.

Especially when AA has the ultimate overlap with two similar cards from two separate banks! Barclays and Citi. I have a feeling Barclays might get the Amtrak deal. They’re close to a bottom feeder probably more so than WF.

 

[mgeller]

I may have missed it, going through this chain (senior moments), but where did the original rumor of BOA going away come from? Is it definitely fact now or still just a rumor?

 

[jis]

I may have missed it, going through this chain (senior moments), but where did the original rumor of BOA going away come from? Is it definitely fact now or still just a rumor?

AFAIK no official communication from anyone yet, except I think BofA is not issuing any more new AGR Cards. There is an end of September date for discontinuance of AGR point accumulation using the BofA Card, but I cannot recall where that comes from.

 

[Shanson]

Yes, the fact that no one can apply to BoA for an AGR card is an obvious indication that the end is near for that relationship.

 

[chrsjrcj]

My account anniversary is coming up soon. I wonder if I'll still be charged the annual fee.

 

[Amtrakfflyer]

We were this week and promptly canceled. We have/had both cards keeping the free one.