Travelers might be hitting a breaking point with their American Express cards and the never-ending cycle of raising annual fees while adding questionable, difficult-to-use benefits. But American Express's own CEO says that trend will continue … and they're not even done this year.
American Express previously promised investors that it will revamp 40 of its credit card products throughout 2024. On Friday, Amex CEO Steve Squeri reiterated that goal: Even after raising annual fees on nearly the entire suite of Delta co-branded cards and Hilton's small business card earlier this year, more moves are in the pipeline.
“Refreshes really do help to drive demand. It drives awareness and it drives more engagement with existing cardholders. It’s been a strategy that has worked very, very well for us.” the CEO told investors during Amex's quarterly earnings call. “You can rest assured, all 40 – or approximately 40 – will be done.”
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I know, I know: I can hear you groaning. Just last week, we cried uncle with the “Extreme Couponing” mindset required to hold most Amex travel cards thanks to an ever-growing laundry list of use-them-or-lose-them benefits. But that's not changing. It's accelerating.
Read more: We’ve Had It – Amex Card Credits & Benefits Are Out of Control
Now, that doesn't mean every Amex travel card in American travelers' wallets will get the same treatment this year. That 40-card tally includes its U.S. cards and many international markets, from Canada to Mexico to Australia and beyond.
Squeri didn't tip his hand as to which cards are on deck next, saying: “We don't really talk about when they’re going to be released.”
But while you might think the $695 annual fee on *amex platinum* is as bad as it gets (see rates & fees), it's only a matter of time before that sees another hike.
American Express has tweaked its flagship travel card every three or four years … and we're nearing the the three-year mark since the last big overhaul in summer 2021, when its annual fee increased from $550 to that current $695 price tag. Just a year later, Squeri and company were already eyeing another increase … with a troubling anecdote.
“As far as how high it goes? Look, in Mexico, we charge $1,000 for the Platinum Card,” Squeri said during an investor conference in late 2022. “The reality is, it'll go as high as the value allows us to go.”
Back in the present day, Squeri explained the bank's mindset for the next round of supposed enhancements.
“We look at what our customers really want and make sure that we’re adding value that makes sense to them,” he said.
Surely, their travel-loving Platinum cardholders were clamoring for a $13 monthly credit for Walmart+ and a $300-a-year, drop-in-the-bucket credit toward a $3,000-plus Equinox gym membership. What's next?
It's not all bad … check out our roundup of Amex Platinum benefits and how to maximize them!
The same fate likely awaits the *amex gold*. While American Express has added and subtracted a few benefits over the years, its annual fee has remained unchanged at $250 (see rates & fees) since a major rebrand in 2018.
The problem for fed-up cardholders is that no matter how time-consuming it might be to track and use all the credits and benefits on your Amex cards, these tactics work like a charm for the bank's bottom line. Amex just keeps making more and more money, including pulling in 15% more in annual fees in the first quarter of 2024 compared to last year – largely powered by its increasingly expensive premium travel cards.
Take the *delta reserve card*, for instance. Along with the rest of its Delta's co-branded, American Express hiked the yearly fee by $100 in February while adding convoluted credits for hotel stays, monthly dinners through Resy, and rideshare trips. Coming just months after the airline's botched overhaul of Medallion Status, a fee increase struck some cardholders as a slap in the face.
For Amex, though, it's been a home run.
“It has really, really gone well. Probably beyond our expectations,” Squeri said Friday. “We raised the fee $100 and added over $560 worth of value.”
That final sentence sums up the entire strategy.
American Express can tout hundreds of dollars in additional value with new benefits to justify raising annual fees … but by making those benefits cumbersome to use, they force cardholders to simply swipe those cards constantly for fear of losing out – or just give up and let them go to waste.
Bottom Line
American Express is saying – and I'm paraphrasing here – that the beatings will continue until morale improves.
It's unclear which cards are next up, but it's painfully obvious that American Express will continue raising annual fees while tacking on additional benefits – some better than others. And it's only a matter of time before the next travel card gets that treatment.
Amex ceo is calling you suckers, well anyone who is paying af is one 🙂
I had the Platinum, Gold, Green and several other Amex cards among the Hilton/Delta and BlueBiz+/EveryDay Preferred. Jumped ship on the Platinum when that $700 fee kicked in, and the Gold after a year, since the EDP was better value. Now, the Green is getting chopped this week, since it’s redundant with the Altitude Reserve, Bilt MC, & Chase Sapphire Preferred. Downgrading the EDP later this year for a similar reason. Amex cards still lag behind in international acceptance, have an overly complicated ̶b̶r̶e̶a̶k̶a̶g̶e̶ “partner credits” schema, and charge a premium to do so. As the fees and credits go up, the smaller my portfolio gets to remain manageable. Keeping the Delta Platinum, Hilton Surpass, Blue Business Plus, and downgrading to the EveryDay. That’s enough.
“Good enough for government work.”
Typical corporate greed. Despite the huge profits they are already making, they continue to figure out new ways to milk their customers, new games to neutralize their so called benefits, and creative ways to make it look like the benefits are worth it.
We’ll be dropping our long run with the Amex Reserve card if they hike the annual fee. Not worth it.
Just got AmexBusPlat in last year on a 190k offer..I can’t imagine paying an a/f more then $695…unless the benefits were super-incredible. I use the airline, dell, and wireless credits. $720 on paper…though the Dell is worth much less. 80% at best..even less considering the hassle factor and over-priced merchandise. I value that at $250. So…if the a/f is not quite a wash…then the main benefit to me is Delta SkyClub & Cent Lounge. The 1.5x construction related – I’ve used a fair bit this year. Nice bonus can’t get with any other card.
I’ll keep the card at least a few years unless things change too much in a negative and/or overly complicated direction.
The Dell credit is rumored to be replaced. We’ll see. All the statuses don’t mean anything to me…get those in other ways.
Gonna downgrade CSR to CSP later this year.
Amex has been good to me and great c/s…so that keeps me using their cards more too. It’s not just about justifying an a/f.
Next year, my Amex Platinum gets downgraded to Gold. I get added to my spouse’s Platinum as an AU. Their Gold will be closed. Also their Amex Platinum Delta CC will be downgraded to a no-fee card. Delta doesn’t even fly from my airport, they stopped in 2020.
Sooner or later, Amex will see this happen a lot, and take action. By then it will be too late, because it is harder to gain a customer back, then retain a customer.
As someone who has been preferring Delta because of the some of the little perks of my Amex Gold, the $50 increase in the fee makes it no longer worth it and removes the advantage of Delta. Since I try to fly in the main cabin plus, I get the free bag and early boarding anyway, so with the price increase it no longer makes sense to use Amex or give a preference to Delta. Since many merchants do not accept Amex, it is no loss to me to not have an Amex card. It’s just greed on their part with no advantage to me to pay the extra.
One thing Squeri of AE doesn’t acknowledge, when he brings up the Card Price and Mexico, is outside the United States the ‘Once in a Lifetime’ Card is more forgiving, as in Europe after a cool-down period, former customers can re-aptly and get a Bonus again.
I just received a mailer with a 200k bonus offer for the Amex Platinum. Wow, wish I’d gotten in on this deal. But, what that tells me is they’re hurting if they’re offering that level of bonus points. I “only” received 100k bonus points 4 years ago.
80k points is the default now
Yeah. I got the 175K offer after months of 150K (after the base offer went from 100K to 80K). He can say what he wants, but tha doesn’t match up
I’ve had to re-evaluate my annual fees and the efforts it takes to mitigate them. While I love certain things about Amex, the fact is I’M PRE-PAYING FOR THE MOST USEFUL CREDITS. I come our ahead, but barely, and when you consider the effort, uou have to treat it like a business. I just canceled the Delta reserve bus bcuz of all the tracking I have to do and I’m not a Delta loyalist. If I become a Delta loyalist, I’ll get the top four cards. I also going to cancel my personal Platnium. I have the business Platnium, gold business, and gold personal, before the annual fee on the gold personal I will cancel it if the fee increase is another cumbersome credit. Once January 1st 2025 hits, and I get my 40 elite night from Marriott I’m canceling the Brilliance and the Bonvoy business. Thus by this time next year, I look to of gotten out of 4 amex premium MONTHLY coupon book, credit cards, UNLESS those credits become more practical to use. I think if the best way to work those premium monthy coupons book premium cards is to strict to a set of the same kinds, like multiple Delta cards, multiple platinum cards, or Hilton Aspire cards. That way it’s the same language and benefits times 1,2 3,or 4.
Very Respectfully
Lu
I disagree with the snark on the Walmart benefit. I absolutely consider that a real benefit. We live in an area where Walmart plus allows for same day grocery delivery and I constantly use the 10 cents off per gallon at Exxon and Sam’s. Walmart is my go to for many staple groceries and products and is a major inflation buster. Delivery is a huge convenience. So the value is real. And that value is real even for people like me who on another night am enjoying 200 dollars off an expensive hotel.
Can’t wait for the price hike so that Centurion lounges empty out.
Will cancel my platinum card once the fee increases again.
This is one reason why I am in my 10th month into my two year card hibernation. So I can start with Chase cards. Hopefully, this hibernation will also get me back to Citi, Capital One and Wells Fargo.
When I first started, I was unaware of the 5/24 rule and started on the wrong track from the get go.
If I were to start today, I would start with Chase and diversify among the banks.
Thanks for the heads up Kyle!
Some good news, I currently have NNL from Amx biz gold pre-approval.
My wife and I no longer have a Platinum card. She has a Gold card but if they mess too much with that we’ll get rid of that one as well.
Have to go to Speedway today to pick up my monthly $10 Grubhub order so I can get my monthly coupon credit.