Monday Insight – August 9, 2021

Cuba – U.S. Air Traffic

Revisiting The Mirage

In Boyd Group International’s 2009-2015 air service demand studies on Cuba, it was determined that Cuba was likely the biggest single new revenue potential facing American carriers. Figure maybe over one million visitors from the USA. But the operative word is “potential” – it’s not here yet.

Not by a long shot.

Message To U.S. Travel Industry: Freedom Demonstrations Aren’t Tourist Draws. Last month, thousands of citizens across Cuba took to the streets to rally for a couple of things that most people in a free country take for granted.

Little things like freedom of speech, the liberty to run their lives outside the control of a Communist government cleptocracy, and be outside the watchful eye of a Stasi-styled secret police. Plus, maybe not get zapped from time to time with things like caloric-rationing and shortages of basic food stuffs.

Enter The Air Service Mirage. Let’s go back to 2014, when the Obama Administration boldly decided to change U.S. policy and embrace the people running the Communist Cuban Government.

The president of the United States flew to Havana and had a whole spasm of photo ops, schmoozing up to the dictator of Cuba and his various Capos. After more than half a century, the U.S. had seen the error if its ways, and would seek to be friends with the Castro government.  Yessir, after one million Cubans escaped to the USA, and thousands more wanted out, it was time for the Obama administration to set things straight.

In all that hoopla, it was announced that for the first time since 1961, air service would be re-established between the two countries.

The raw enthusiasm for air travel demand between the USA and Cuba swept the travel industry like 1960s teenagers anticipating the arrival of the Beatles. We heard all about the “pent up demand” for Cuba travel (?) … and the Obama administration was fixin’ to open those floodgates. Hundreds of thousands of new passengers would be crowding through airline hubsites, hankering to connect get to Havana, Matanzas, Santiago and other places.

Back then, any Luddite suggestion that this may have been cheerleading for a team not yet on the field was strictly ignored. Like, the fact that Cubans by and large didn’t have sufficient incomes to pay for baggage fees, let alone a vacation to see Disneyland. Or if they did, even being allowed to leave the workers’ paradise.

How ‘bout hotels for the Normandy-like invasion of expected U.S. visitors. Or rental cars? Or “resorts” that could even begin to compete with other Caribbean venues? It was clear as a blemish on prom night that the vast majority of the revenues would be U.S.-generated. One-sided traffic generation.

That troubling bit of O&D reality was buttressed by the fact that it would be only U.S. carriers in this game. Any arriving Cuban flight would be greeted by attorneys even before the lav truck could arrive, attaching the airliner due to standing lawsuits against the Castro regime. So much for two-way travel.

The point is that the boom never happened, mainly because there is no business or leisure base in Cuba. (And, for folks still wallowing in political myopia, Cuba’s mess is not due to the U.S. embargo. Cuba has no prohibitions on freely buying anything from the rest of the world.)

The travel groupies missed the fact that the infrastructure and resorts in Cuba couldn’t match the competition in the rest of the Caribbean. The panting politicians expecting huge business and commercial trade with Cuba never bothered to really get informed before issuing drippy-drooly congratulatory press releases about the brilliance of the move to play up to a Communist dictatorship. There is no business base in Cuba, because it’s all government-run.

The Future – A Bonanza Is Still Possible – Likely, Actually. In 2019, the Trump Administration effectively restricted scheduleD flights to only Havana. Airlines that had won rights to other Cuban cities should have sent thank-you notes, as most of the routes turned out to be dogs… due to lack of traffic, high costs (many “off invoice”), or both. Now, they can wait until things change in Havana.

The street demonstrations in early July are a strong indicator that this may be in the cards.

Boyd Group International has covered this in more detail in the latest Aviation Unscripted video, which can be accessed on Rumble by clicking here.

BUT DO BE PREPARED – THE UNSCRIPTED VIDEO GOES INTO AREAS THAT THE MEDIA HAVE NOT TOUCHED… INCLUDING VERY DISTURBING PICTURES OF THE US PRESIDENT’S 2014 VISIT TO HAVANA… VERY DISTURBING, especially in light of recent events in Cuba. Click on and take a couple minutes for perspectives that are left out of most narratives covering 2014.

And our 2015 study is still (unfortunately) an accurate depiction of the Cuba travel picture. Copies can be ordered through the contact button on this site.