Lower prices in 2020 in most of Latin America | Instant News


With a significant drop in business travel due to the pandemic, coupled with recessions in a few markets, average daily prices fell across Latin America in 2020, with a few exceptions. Hotel prices led the trend, with more than a third of the region’s markets covered in this report showing drops of nearly 20% or more. “It’s a tough year for numbers and forecasts,” said Fernando Michellini, CWT director for Latin America North. “Flight and hotel prices are down. We have seen a 35% reduction in flight prices compared to 2019. Hotel prices are down almost 27%.” CWT car rental prices, on the other hand, increased as demand was predominantly domestic. “The borders are closed which makes international travel really difficult at the moment.” Air routes and capacity were also disrupted, with three of the region’s major airlines filing for Chapter 11 bankruptcy in 2020: Latam in May, with its subsidiary Latam Argentina ceasing operations in June and filing for bankruptcy of Latam Brazil in July; Avianca also filed for bankruptcy in May; and filing of Groupo Aeromexico in June. The latest BTI Outlook report from the Global Business Travel Association estimated a 45% drop in business travel spending in Latin America, to $ 27.5 million in 2020, from an average drop of 51.5% in Latin America. world. Price volatility The most expensive market in the region was once again San Juan, Puerto Rico, with an average per diem of $ 327.33, a 20% increase from 2019. The next in line, also with a 20% increase, was San Jose, Costa Rica, to $ 271.60. These gains were offset by larger business travel markets posting declines, notably Sao Paulo, Brazil, down 21% to $ 203.28; Bogota, Colombia, which closed its borders for much of the year, down 25 percent to $ 137.73; and Buenos Aires, Argentina, which is in recession, down 30% to $ 171.19. Colombia made some changes to its tourism law that eliminated value-added tax for hotels, restaurants and bars to support the industry, said American Express Global Business Travel General Director for Latin America and the Caribbean Jose Camarena. “This may be one of the reasons why you are seeing such a decrease [in Bogota]”, He said.” In the case of Buenos Aires, there was a [economic] “Another potential impact on the decline in business travel to Argentina: Coca-Cola moved its offices from Buenos Aires to Brazil in 2020,” Michellini said. The cost of transportation from the airport to downtown at the 14 covered markets was split evenly between gains and losses, but the differences varied widely. The cost of Guayaquil doubled to $ 12.50 and that of Mexico City rose 44% to $ 15.17. to $ 7.20, while Sao Paulo’s was more than halved to $ 18.47. The cost of a meal increased in 10 of the 14 cities, but the price changes were more moderate, with the exception of Bogota and Buenos Aires, which saw sharp declines. The increases of 20% to 30% include Guatemala City, Mexico City and San Jose. Hotel prices, however, fell year over year in 11 markets, and exhibited the most volatility. Panama City, for example, reported quarter-over-quarter rate changes recorded by companies ranged from a 63% drop to gains of 129%. Looking at the granular data, a sudden drop in booking volumes combined with a tendency for some companies to book at lower or higher service levels may be responsible for this development. Overall, the first quarter, before the pandemic, showed mostly healthy increases for the region. But the second and third quarters indicated there was little business travel, with many markets reporting no bookings in certain levels of hotel service. Data shows a recovery in bookings and prices in the fourth quarter. “Most hotels are just open with limited capacity,” said BCD Travel vice president of sales and marketing for Latam Rolando Robles. “We have looked at the cases that have passed through us and there is [an overall rate] decrease because the largest volume is domestic. This will lower your average, “he said, indicating that domestic bookings tend towards limited service and lower levels compared to international bookings. Pandemic update One of the challenges of this pandemic is that the situation in countries is constantly changing, and this is particularly difficult in Latin America. “There is no doubt that the situation [in Latin America] hasn’t improved in recent months, and if anything has gotten worse, “said SOS International Vice President and Global Medical Director Dr Robert Quigley, who stressed the importance of not calling specific destinations because the information available “is very fluid. “and changes almost daily.” I am concerned about what is happening there despite the fact that most countries have adopted best mitigation practices, but the results are not that good. As countries in the region have started administering Covid-19 vaccines, ‘many countries have limited health care infrastructure,’ Quigley said, noting that there is not necessarily the resources or the technology to deliver vaccines as quickly as in the US 19 cases may ease, other pre-pandemic issues remain, such as zika virus, denge, malaria and crime. “Just because you have been vaccinated, you should always keep your guard on clean water, disease and crime, ”he said. Still, vaccines and tests have brought hope to the region. “Vaccinations have started to be applied in most countries now… and some governments have put in place medical certificate requirements or PCR tests for traveling to or from the country,” Camarena said. “We believe that long-term vaccinations and government travel policies should have a positive impact for the traveler. They should feel more confident with the new protocols and precautions. ” In addition to the vaccine that gives hope, there are signs of life when it comes to business trips to the region. “In the case of Mexico, oil and gas, healthcare and telecommunications are leading the way based on the trends we’ve seen,” Camarena said. “In Colombia, medical research is starting to increase at a faster rate, combined with oil and gas. We are also seeing a trend of increased bookings at hotels in all countries. Some companies send employees by ground transportation. “Another sign is an increase in bookings from small and medium-sized businesses“ in Mexico and Argentina, and we’re starting to see this also in Colombia and Brazil, ”Camarena said. Agreed.“ Small businesses continue to do business. , which is completely different from big companies, ”he said, adding that agriculture in the region is doing very well, as are construction companies and factories that produce iron and equipment for construction. “And financial services are doing well,” he said. For gross domestic product, the numbers were stable in 2019, and once the official numbers are released for 2020, they will likely be down. “For 2021, I’ve seen more optimistic reports, of growth of 3% in Brazil to around 3.8% in Mexico, which are two of the largest markets in the region,” Robles said. these alone represent nearly 60 % of Latin America’s GDP. But January and so far in February have been slow, so we’ll probably have to push back expectations. [of a greater recovery] to August or September 2021. “In addition, companies are reviewing their travel policies.” It was about stopping travel first and then allowing urgent business, “Michellini said.” Now we are starting to have conversations to see what we can do with the business return policy, [companies] can do for health measures for travelers. Robles added that BCD is also seeing customers review their travel policies, “which have not been revised for 10 years,” he said. ” They make sure they are up to date. This is positive for our region, as on several occasions travelers have found their policy too broad, complex and very outdated. “Some companies are also considering incorporating sustainability practices into their policies,” Camarena said. We’re happy to see that, “he said.” In Mexico, we found that over 20 percent of the companies we work with have taken at least one or two sustainable actions in their businesses. If you asked me two years ago, I would say that no company was taking sustainable action. ”



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