Q – My husband and I were scheduled to fly our favorite airline, Alaska Air, to Cuba in March. We live in Pasadena and the non-stop flight from LAX was perfect. Now, we have been notified that they are operating their last flight in January. We’re making other plans, but we’re wondering why they would pull out when the flights appeared to be going out full?
A – Actually, business to Cuba is down significantly, Alaska Air says by 80% since the November 9th U.S. government decision to end the people-to-people program. Given the sharp reduction in business, Alaska, along with several other operators, have canceled or reduced their operations to Cuba.
There are several intertwined issues here one of which is the fact that laws in Cuba currently require heavy percentages of Cuban hotel and tourism industry ownership. This basically means that if you construct a new hotel, there is a likelihood that your partners will be Cuban military and government officials. We have been advising that travel to Cuba should be postponed for 24 months. We now think that a more realistic timetable is five or six years assuming new construction plans with ownership adjustments can be implemented by the current administration. (wasn’t that said nicely?)