Airfare sticker shock land Caribbean cruises?

Is price an important factor in planning a Caribbean vacation?

Leisure travel to the region has surged on the landscape since the outbreak, but a key airline association official said higher flights would continue to boost the number of visitors to the Caribbean.

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“Caribbean destinations are at risk of pricing themselves out of a global travel and tourism market where passengers have more choice than ever,” said Peter Cerda, regional vice president for the International Air Transport Association (IAAA) Americas.

Speaking at the joint Caribbean Tourism Organization (CTO)/IATA conference held last week at the Ritz-Carlton, Grand Cayman, Cerda said taxes and fees imposed on airlines by Caribbean governments have a significant impact on regional airline fares.

He warned that higher fares would drive travelers to other destinations. “Today’s travelers have choices and overall vacation value is becoming an increasingly important part of the decision-making process,” said Serda. “Governments must be prudent and not price themselves out of the market. Caribbean aviation taxes are higher than the global average.

Cerda credits the taxes and fees with supporting new transportation infrastructure in the region. But the IATA official questioned the “transparency” behind some governments’ tax policies.

“We understand that providing adequate infrastructure for aviation comes at a cost,” Serda said. But it is often difficult to see the correlation between the level of prices and fees and the actual service provided.

Price war

Speaking at the opening of the Grand Cayman conference, Cerda said that globally, government taxes and fees represent 15 percent of airline fares, double the average in the Caribbean, where taxes and fees represent 30 percent.

It said taxes and fees represent 56 percent on flights from Barbados to Barbuda. Comparatively, taxes and fees on flights from Lima, Peru to Cancun, Mexico represent 23 percent of the airfare.

In another example, Serda said, “From Miami to Antigua, we’re looking at a $900 round-trip ticket for the same dates in October. But a round-trip ticket from Miami to Cancun averages $310,” he said. “For a family of four, that difference is more than $2,000.”

Reasonable price

Cerda said IATA is not looking for unilateral tax cuts on Caribbean destinations and that improving the region’s infrastructure will benefit airlines. “The industry is not asking for a handout, nor are we expecting the infrastructure to pay for itself,” he said.

We want a competitive market that operates in an open and fair manner. We want to be a core and strong strategic partner with governments in the Caribbean.

However, Jamaica’s tourism minister, Edmund Bartlett, has argued that the top Caribbean airlines’ revenue comes from more than the taxes levied at the destination.

Bartlett pointed to airlines’ profit management policies, which consistently push fares to the highest levels, as at least partly to blame.

“What we want is affordable travel,” he asserted. This results in limited liability on the part of the service provider. It’s a matter of when you see it. [rates at] $900 to fly from Grand Cayman to Miami,” Bartlett said.

But where is the ability of the airline to operate this route? he asked. “Airlift is responsible for affordability.”

He met Serda, “more attractive [governments] to do [their] Islands, the more competition, the lower the price. But he later admitted, “We charge what the customer pays on demand.”

“My colleagues and I can talk about some of the things we would like to see here,” Cayman Islands Tourism Minister Kenneth Bryan said during a media briefing. [conduct] An accurate analysis of the pros and cons, to which we respond.

“It’s part of finding solutions to relationship issues,” says Brian. Of course the airlines are going to say ‘cut the price’. But each of us is concerned with the responsibilities of our members.”

Bryan said Caribbean officials had pledged to discuss taxes and fees with airline companies through IATA, which he called “a very good first step.”

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