RIO DE JANEIRO, BRAZIL – After a period of adversity for the industry due to the pandemic and quarantines, tourism companies in Argentina are enthusiastic about a strong recovery of operations in the domestic market. However, they warn about the slow return to normality at the international level. However, they also highlight a strong demand from Europeans and Latin Americans to visit the country.
The improvements in the statistics and the sector’s expectations occur even though the country is going through a complex economic situation, including a foreign exchange restriction, the lack of financing, and the fall of purchasing power in the face of galloping inflation. After an Easter Week with good results, the sector is already registering inquiries for the winter vacations and the World Cup.
“The industry is recovering. The fact that governments are starting to lift the Covid-19 restrictions helps a lot,” said Dolores Silva Font, Strategic Planning Director at CVC Corp Argentina (CVCB3).
The referent of the travel group, which owns Almundo and Avantrip, said that to see the progress, “it is best to differentiate” the domestic market from the international market: “They are two very different worlds”.
“The domestic market in this first quarter, if you see the published offer, is already at 65% of what 2019 was, that is, the pre-pandemic period. In the international case, we are still a little bit more affected, and the recovery is slower,” she analyzed in a dialogue with Bloomberg Linea.
Paula Cristi, Despegar (DESP) Country Manager for Argentina and Uruguay, said: “We have a recovery trend and a very interesting rhythm”. “Of course, with ups and downs. The Omicron situation, mainly at the end of December and January, reduced demand slightly, but we are already seeing that the industry is recovering again. We had a very positive end to the fourth quarter. We are very optimistic about what lies ahead”.
In declarations to this media, he highlighted: “Argentina has been making good progress. Mainly, domestic tourism is recovering, leveraged by the Previaje program, and it was a good engine for the recovery”.
BRAZIL CHOOSES ARGENTINA
“We are very optimistic about inbound tourism. Argentina is once again becoming a destination of choice for Latin Americans. Cristi pointed out there was a growth in demand from Brazil to Argentina of almost 90% in March compared to February and January”.
He also assured that “there is interesting growth in passengers from Chile and Peru”. “Argentina is once again being chosen as one of the vacation destinations,” said Despegar’s General Manager for Argentina and Uruguay.
According to company data, Brazil leads the ranking of tourists most interested in Argentina. “The following are Chileans, who also reflect a significant rise in interest, which is related to the possibility for residents of neighboring countries to visit Argentina without a Covid test since the requirements are only a complete vaccination schedule and medical insurance,” she explained.
According to the company’s data, the podium is completed with Peruvian tourists. “The great interest in the natural, cultural and gastronomic attractions that characterize our country works as an engine to reactivate receptive tourism, which, in turn, has a positive impact on the country’s economy. Let us remember that the industry represents 10% of the national GDP”, said Cristi.
TOURISM GROWS DESPITE ECONOMIC DIFFICULTIES
Silva Font assured that Europe is among the destinations growing in the Argentine demand: “We have a very high percentage of sales and searches for May and June”.
Given the lack of installments to leave the country regarding the payment method, she stated that “cash and credit cards with a single payment have grown,” but the company also decided to take out “personal loans”.
Because of this difficulty, Despegar also decided to offer initiatives to facilitate access to travel and announced an alliance with Efectivo Sí, through which the company’s customers will be able to obtain loans to finance trips abroad.
“The process to obtain the personal loan is 100% digital. Everything is done through Despegar’s site easily and quickly when finalizing a transaction, and it has a detailed step-by-step to make the purchase. When requesting the loan, it is important to remember that Efectivo Sí is the one offering the loan, and Despegar is the facilitator,” the company explained.
TRAVELERS’ NEW HABITS
According to Cristi, there has been a change in the length of rentals since “longer stays” are now sought to combine vacations and remote work.
Font also pointed out that “it is true that passengers have changed the way they buy, book and travel”. “Now they are more accustomed to traveling on time, the booking curve has shortened. The positive thing is that airlines can increase supply in a shorter period.”
“The tourism sector did very well to use the pandemic first to learn how to serve the customer, strengthen post-sales operations, and then prepare for what was coming,” she emphasized.
“There was a lot of change in customer behavior. Passengers traveling internationally now buy insurance because, in many places, it is required, but even now, nobody would think of going without insurance, something they used to do before. In addition, local tourism has grown a lot, and the sales department has changed to assist the client in person,” he said.
The advantages and challenges of operating in Argentina
When asked by Bloomberg Línea about the main advantage of operating in the country, Paula Cristi, Despegar’s Country Manager for Argentina and Uruguay, said: “It is the talent. We have very good talent in Argentina. We are always looking for people to join our technology team. In fact, we have a program called Jóvenes de Alto Vuelo”.
“One of the challenges is critical mass. Hopefully, more and more young people will choose careers associated with technology, and for that, public-private articulation is key. There must be plans to get interested in this type of career in the primary stages, before adolescence. Technology is something that already crosses us,” she said.
Meanwhile, Dolores Silva Font, Strategic Planning Director CVC Corp Argentina, stressed: “The main challenges in Argentina are macro. What happens with the currency, devaluation expectations, the economic situation”.
“As for opportunities, there is desire. Suppliers are dying to get back to normal, and customers are desperate to travel, to get back to what was. Argentines travel a lot. If there is a desire on both sides, it is a huge strength, and somehow we can get ahead,” she said.
With information from Bloomberg Línea