March 01, 2012

U.S. charters struggle with weak demand for Cuba flights

Posted by Doreen Hemlock - No Comments
Filed under: Travel

U.S. charter flights to Cuba are getting a boost from Pope Benedict XVI’s visit to the island later this month, but demand for year-round service remains limited, delaying plans to add flights from more U.S. gateway cities.

Even existing charter service to Cuba is performing below expectations, with flights added last year from Tampa and Fort Lauderdale slowing growth in Miami, charter operators say.

The reason: Despite the relaxed travel regulations now in force, the U.S. Treasury Department has been cautious about approving new “people-to-people” trips to Cuba. A slow U.S. economy — and relatively high prices for charter flights — crimp visits by Cuban-Americans. And charter operators themselves are wary to spend on expensive leases for planes unless they’re confident they will sell enough seats and luggage space to cover their costs.

That explains why ABC Charters of Miami considered flying from Dallas-Fort Worth on leased American Airlines jets but opted to wait. President Tessie Aral wants to see stronger passenger demand first.

Likewise, Airline Brokers of Coral Gables is launching two more flights a week from Fort Lauderdale starting April, but will cut two a week from Miami to compensate. “By eliminating these two flights, we’re making certain that we don’t oversaturate the market,” said executive Alexis Ravelo-Lombana.

The pope’s visit is helping the charter companies temporarily — but not without headaches.

Airline Brokers is adding several flights from Miami and Fort Lauderdale, but logistics are tough. It will take some passengers to Santiago de Cuba, but can’t wait around to fly them out. Santiago’s runway is too small to hold all the planes for the pope’s trip. So its charter will return empty to Florida and then, fly back empty to Santiago to pick up those passengers heading to Havana.

Meanwhile, some U.S. residents interested in seeing the pontiff have decided not to visit Cuba because of the cost. A week-long package including flights, hotels and other basics can top $2,000. That’s partly because Havana hotels are charging peak rates and rising fuel prices have increased costs for flights, travel executives say.

The latest data from Miami — the top U.S. gateway to Cuba — shows that after a 55% jump in 2010, the number of passengers leaving MIA for Cuba rose only 5% in 2011 to 335,335. About 1,500 passengers also flew charters from Fort Lauderdale and another 3,500 from Tampa in 2011. Combined, that’s still less than 350,000 passengers taking charters from Florida to Cuba last year — far fewer than many operators had hoped (see map, page 14 of this issue). 

Said a recent headline in the Tampa Bay Business Journal: “Wanted: More Tampa-Cuba passengers.” In Puerto Rico, the charters also have struggled with weak demand. 

Cuba Travel Services, based in Oakland, Calif., confirmed it has halted its weekly flights from San Juan to Santiago de Cuba, though it may offer seasonal service later if demand warrants it.

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