The team of analysts and insights experts at ForwardKeys can reveal an exciting revelation – things are looking rosier for the travel industry in Central America and the Caribbean, especially when looking at the future bookings for July to September. International arrivals are down by just 25% in Q3 of 2021 while in Mexico it is only down by 6% compared to the same period in 2019.

The rise of Central America tourism and Caribbean dominance in Q3, 2021

“In the next months, some destinations may get very close to 2019 results,” says Luis Millan, Market Researcher at ForwardKeys.

Confirmed tickets show strong demand for Central America: El Salvador and Belize. El Salvador is +31% on international arrivals compared to the same period in 2019, pre-pandemic. Belize is also witnessing double-digit growth at +26%.

Honduras and Costa Rica are well-positioned as well, thanks to their vaccination-friendly travel requirements. Unfortunately, the outlook is more pessimistic for South American destinations.

The recovery is driven by the US market, as Canada maintains strict limitations for non-essential travel. Transatlantic markets, Europeans, are gradually picking up, now roughly around half of the demand in 2019.

“We observe that Mexico, the Caribbean and Central America will be getting closer to 2019 volumes in Q3, as they manage to capitalise the reopening of the US market. These regions will benefit from a substantial performance improvement in Q3,” says Millan.

The Caribbean is a region fully taking advantage of its source markets in the US as well as in Europe. One can only wonder what the figures will look like once more destinations make the UK Green list.

South America and the role of domestic travel

As international travel demand is currently weak in South America, domestic markets represent a vital lifeline and a new focal point for tourism boards. It’s the case for Brazil and Chile, where domestic travel demand for Q3 is reaching 80% of 2019 volumes.

“When examining the scheduled seat capacity for domestic flights in Q3 in Brazil, we can see that the airlines are betting on an increase in demand, with capacity volumes getting closer to or surpassing 2019 levels, as is the case for top leisure destinations such as Recife,” adds Millan.

The Chairman of Emprotur Brazil., Bruno Reis says: “We have set out a strategy of positioning our destinations within a wide range of touchpoints, focusing more on conversion rather than awareness. We are developing co-op marketing campaigns with retail agencies, OTAs and big tour operators, also running training sessions for travel agents in parallel to provide them with resources to help with their sales process.”

In a time of restrictions to international mobility, and deteriorated consumer confidence due to the fast-changing travel conditions, many tourism stakeholders around the world as seen above have chosen to target the domestic market to mitigate the impact of the crisis.

As per other parts of the world travel reactivation in Latin America is kicking off at a different pace pending on your location, the rules of play that you have set in place, rate of vaccination and appeal to a wider audience of travellers in the US and Europe. What will the final quarter of the year hold? Stop guessing and contact us to learn more about our science-based forecasts and air ticketing data!


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