After State Department Warning, Will Politics Hurt Cuba Travel?

The travel industry is once again addressing the effects of Trump administration policies regarding travel to Cuba, as the U.S. State Department warned Americans to put off travel there indefinitely due to safety concerns.

Up until recently, this burgeoning market for agents, tour operators and others has been resilient in the face of the administration’s June threat to restrict so-called “people-to-people” travel. (Only broad policies were defined in June, while the administration’s Treasury and Commerce Department regulations have not been finalized as of yet.)

On Friday, the U.S. State Department withdrew about 60 percent of its staff from the Cuban embassy in Havana, and also cautioned Americans to defer travel to Cuba as it was concerned tourists could be targeted or be incidentally impacted from attacks directed at U.S. diplomats.

Now, the fear of physical harm to tourists could create some slack in demand, despite the fact that no American travelers have reported symptoms similar to what afflicted U.S. diplomats attached to the Cuban embassy.

Suppliers monitor situation and offer travelers concessions
JetBlue Airways, for example, responded to the potential fear by announcing Friday that is was waiving change and cancellation fees, as airlines often do when storms or bad weather threaten to shut down airports. The carrier said the changes were “due to the travel warning issued by the U.S. Department of State for travel to Cuba.”

JetBlue customers must rebook their flights by Wednesday, November 1, 2017. Customers may choose to cancel and receive a JetBlue credit, or travel to an alternate destination.

Most industry travel companies however were waiting and monitoring consumer responses to the warning.

In a press statement, Royal Caribbean Cruises said the line feels that events cited by the U.S. State Department don’t pose a risk to its passengers, so it is continuing with its itineraries as scheduled. Other travel service providers, including American Airlines and Carnival Cruises, said they were monitoring the situation closely, and had no current changes to service to Cuba.

Switzerland-based Kempinski Hotels, which operates the recently opened five-star Gran Hotel Manzana La Habana Kempinski in Havana, would not comment directly on the U.S. State Department warning. The company is continuing to monitor “regulatory changes closely, and make appropriate adjustments as and when required,” said Kempinski spokeswoman Eva-Maria Panzer.

”In the meantime, we are confident in our ability to continue offering high quality services to all of our guests visiting Cuba from around the world.”

In a statement, the American Society of Travel Agents said: "The safety of embassy personnel is paramount here, and we are hopeful the U.S. and Cuban governments will get to the bottom of this in short order. In the meantime, the State Department's travel warning is the kind of information agents should share with their clients, as is the fact that there is no evidence of private citizens or American travelers being affected. Travel agents can and should help their clients make an informed decision on where to travel, but the decision must be the traveler's."

Some question safety concerns
Some agents expressed that the travel warning might not be a realistic reflection of the risk travelers face.

“I tend to lean toward this being a political action. The symptoms the diplomats have experienced haven’t affected a single American traveler, and the knowledge that this was happening has been going on for a year,” said Chad Olin, CEO & founder of Cuba Candela, a Miami-based company that creates custom tours to the island nation.

“Cuba is one of the safest countries in the world,” Olin said, “and even many of the U.S. State Department employees said they would rather stay behind.”

Indeed, the Canadian Government has no current advisories for travel to Cuba. While Global Affairs Canada currently advises against all travel to Cayo Coco and Cayo Santa Maria due to damage caused by Hurricane Irma, it only urged Canadian travelers to “exercise normal security precautions” elsewhere in Cuba.

Demand for Cuba strong through this summer
U.S. travel to Cuba remained strong up until this fall. Cuba Candela has enjoyed a 125 percent rise in bookings this year, Olin said.

“There is still an extraordinary amount of demand for Cuba tourism, but there is some confusion about what the June announcement means,” Olin said, referring to the impending Treasury and Commerce Department rules. 

“What we were seeing before the [State Department] travel warning were more inquiries from travel agents and travel companies looking for guidance to interpret the new rules. For individual travelers, there is confusion that individuals can no longer go to Cuba, which isn’t true,” Olin added.

The Trump administration's new proposed rules will eliminate “people-to-people” travel, which allows American travelers to book individual trips; U.S. citizens will now have to look to group tours to visit Cuba. Additionally, individuals may have a harder time proving their visit falls under one of 12 authorized categories such as a religious, journalistic or artistic activity.

Long-term prospects remain strong
Despite last week’s U.S. State Department warning, long range prospects for Cuba travel appear to remain strong. Just prior to the announcement, United Airlines submitted an application to the U.S. Department of Transportation (DOT) to increase its current once-weekly Houston-Havana service to daily service.

Launched in December 2016, the Saturday-only flight was described by United as “successful,” and its application for expanded service “reflects the airline's optimism about future growth potential.”

"United's daily air service from Houston to Havana will greatly increase opportunities to connect family and friends while significantly increasing potential for trade and investment between Houston and Cuba," said Houston Mayor Sylvester Turner in a press release. 

United is looking to fly either Boeing 737-800, with about 166 seats; or the 76-seat Embraer E175 regional aircraft, operated by Mesa Airlines as United Express.

Kempinski Hotels “entered Cuba in response to the increasing demand for high quality luxury hotel services in this market,” Panzer said, adding that “our long-term strategy allows us to invest in the destinations of tomorrow, creating local jobs and contributing to the market’s economic development.”

Norwegian Cruise Lines this year called its first season of Cuban sailing a “home run,” while Trafalgar recently released its USA & Canada 2018 brochure with six new itineraries including its first trip to Cuba.