More people are traveling each year and the world is getting richer. That means rising prices around the globe, but the good news is, travel rates are rising less in Latin America.
Last month Travel Pulse posted a story called Strong Local Economy Means Higher Travel Prices. We Americans have been insulated a bit from this since the U.S. dollar has been strong the past few years. Ask a European or Canadian though and they’ve definitely felt the price inflation. You regularly see stories in the British press about how package holiday prices are up double digits from the pre-Brexit days.
In the countries we cover though, from Mexico down through Tierra del Fuego, travelers haven’t seen much of a spike. Part of this is due to more limited air connections, part of it is due to just lower numbers of emerging market visitors. Economic and currency factors also come into play, the result being more bank for your luxury travel buck in Mexico, Central America, and South America.
If you’re looking to find a good business class flight deal in the coming months, you’ll probably have better luck on Avianca or Copa heading south than you will on Lufthansa or Singapore Air heading east or west.
Asia Pacific will see an airfare rise of 2.8 percent, according to the survey. Air travel is expected to increase 5.5 percent in Western Europe and 8.5 percent in Eastern Europe. The Middle East and Africa will see an increase of 3 percent. Latin America will see just a slight increase of 0.3 percent. (An increase in capacity is keeping prices low.)
We’ve been talking about that increase in capacity often over the past couple years on this blog and in our newsletter. Flight options to Mexico have increased dramatically since rule changes went into place last year. The big U.S. and Canadian carriers, plus several Mexican ones, have all added more flights to more locations.
The increases are more spotty in other locations, but there’s been a gradual increase in flights to Costa Rica, Belize, Colombia, and Brazil.
Growth in luxury hotels has been steady and organic, which we think is a healthy thing. The only location in Latin America that could possibly be considered overbuilt in the near future in the luxury category is Los Cabos. Time will tell if the tip of Baja can support so many properties with rates above $600 per night plus 32% in taxes and service fees, but the increasingly heavy competition should be good for picky guests.
Will this last forever? Will Latin America continue to be immune from travel price inflation? Probably not, so don’t put that dream trip off forever…