American Airlines has solidified a new 10-year agreement with Citigroup, designating the bank as its sole credit card partner and ending its decade-long partnership with Barclays. The deal, announced Thursday, will see Citi become the exclusive issuer of the AAdvantage co-branded credit card in the U.S. starting in 2026.
American Airlines CEO Robert Isom lauded the partnership, stating, "The strength of our relationship with Citi has enabled us to deliver first-class products and customer service to millions of AAdvantage cardmembers. This expanded partnership will unlock even more value and exciting new benefits for all of our customers in the future."
Under the agreement, Citi will take over all aspects of credit card issuance for American Airlines, including transitioning current Barclays cardholders. The airline announced that cardmembers holding Barclays-issued AAdvantage cards will continue to enjoy their benefits until the transition is completed in 2026.
Citi CEO Jane Fraser expressed enthusiasm for the strengthened partnership, saying, "We're now excited to take this relationship to greater heights through an expanded customer base and a series of new loyalty and reward offerings."
The move consolidates American's co-branded credit card offerings, which had been split between Citi and Barclays since American's 2013 merger with US Airways. Barclays cardholders, including those with the AAdvantage Aviator Red World Elite Mastercard, will be absorbed into Citi's portfolio as part of the transition.
Co-branded credit card deals are a significant source of revenue for airlines, as they sell frequent flyer miles to banks in exchange for billions of dollars. These partnerships also drive consumer loyalty, incentivizing cardholders to use their airline-branded cards for everyday purchases.
American Airlines earned $5.6 billion from its co-branded credit card program and other related partnerships in the 12 months leading up to September 30, with the company projecting 10% annual growth in such payments. Despite the lucrative nature of the program, Delta Air Lines currently leads the industry, generating nearly $7 billion in 2022 through its partnership with American Express. Delta anticipates that figure to rise to $10 billion in the long term.
The exclusive deal with Citi positions American Airlines to strengthen its financial footing and enhance its loyalty offerings. Shares of the airline rose sharply following the announcement, climbing nearly 8% in pre-market trading.
Citi already offers four AAdvantage co-branded credit cards, including the AAdvantage MileUp and the CitiBusiness/AAdvantage Platinum Select Mastercard. With the addition of Barclays cardholders, Citi's American Airlines card portfolio is expected to grow significantly, expanding the reach of its loyalty and rewards programs.
The announcement concludes months of speculation about American Airlines' plans for its credit card partnerships. CNBC reported in September that the airline was negotiating an exclusive agreement with Citi, a relationship that dates back 37 years. By choosing Citi as its sole partner, American follows the lead of other airlines such as United, which partners exclusively with Chase, and Delta, which collaborates with American Express.
