The airline industry has been worrying for many years about a possible upcoming shortage of pilots to fly all the…
Vaccination Tourism Takes Off from Argentina to Florida
In this year and a half in which the commercial aviation industry received its worst hit since its inception, airlines were desperate to find routes that could still hold three characteristics: high demand, low competition and minimal restrictions. In Latin America, there is one route in particular that covers those three almost-impossible-to-meet requirements and is experiencing a boom that reminds us of better days: Buenos Aires to Miami.
In the last 30 days, the market has shaken and the demand for the route has grown exponentially. The reason is simple — and a sign of the times: the ease of conditions to get Covid-19 vaccines in the U.S. and a combination of lack of patience and distrust in Argentina’s vaccination campaign, many Argentinians have decided to travel, get a vaccine and get back to home. The interest for the route grew quietly, as some travelers found that there were possibilities to get vaccinated in some U.S. states by giving vague responses to questions meant to distinguish those who were eligible to get vaccines in early 2021. In fact, some cases made the news and prompted governmental action.
Right after that first approach, there was a wave of rumors threatening possible travelers: visa cancellations, permanently prohibiting U.S. entry, criminal prosecution, you name it. But after Florida confirmed that there would not be any restrictions for visitors to get a shot, demand exploded. Besides this factor, the possibility to get the single-dose Johnson & Johnson vaccine has eased the need to either spend almost a month in Florida or to travel twice, making it much shorter in time and more affordable. In its first stages, that boom was somewhat affordable for many middle-class, decent-income, good-credit, virus-fearing consumers but, as always, airfare prices rapidly respond to the renewed interest.
Supply to Meet Demand
There are two companies that cover the route with non-stop services: American Airlines and Aerolíneas Argentinas. During the whole pandemic, American’s Buenos Aires to Miami daily service ran almost without interruptions. Sources close to the carrier said the load factor was always on the high side, nearing 85% throughout 2020 and 2021, making it probably one of the few routes that were actually operating in the black and are now experiencing a boom.
The other carrier, Aerolíneas Argentinas, has seen a peak in interest. Load factors grew from 62% in March to 74% in April, all flights are full in may and occupation for June is reaching 73% at the time of writing.
While there are non-direct routes and demand has grown on those combinations as well, the current travel restrictions tend to discourage travelers from adding pain points such as connections. As a result, direct route airfares experienced a significant increase. It doesn’t come without a bit of irony that a good number of commentators and political actors in Argentina that firmly complained about Aerolíneas Argentinas’ detachment from supply-demand market rules resulting in significant losses in the past are now firmly complaining about Aerolíneas Argentinas’ price increases in response to the same market rules and are now asking for the company to reduce those prices, which obviously would result in significant losses.
As Argentina is set to receive 10 million doses by the end of June and should start producing doses of the vaccine locally, this boom is bound to fade quite soon. But in the meantime, we can see the rare spectacle of a route that is in high demand, in a boom that has little to do with normality and a lot to do with these insane times of today.
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