Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: This is Bloomberg Business Week with Carol Messer and Tim
Speaker 2: Stenebek on Bloomberg Radio. Well before Striking Texas, Beryl crashed
Speaker 2: through the Caribbean, raking across Jamaica and Mexico's Yucatan Peninsula.
Speaker 2: On the completely other side of Mexico, at the southern
Speaker 2: tip of the Baja California Peninsula on the Gulf of
Speaker 2: California and the Pacific, we find our next guest, who
Speaker 2: has the enviable task of living in the resort city
Speaker 2: of Cabo San Lucas.
Speaker 3: If you need some help, you can reach out to us.
Speaker 3: We've got back with us Rodrigo Espanda. He is managing
Speaker 3: director of the Los Cabos Tourism Board. He joins us
Speaker 3: from Los Cabos, Mexico. Rodrigo's Rodrigo. It's been a few years,
Speaker 3: so it's great to be back with you.
Speaker 2: How are you.
Speaker 3: I think the last time we talked to you is
Speaker 3: December of twenty twenty, A very different.
Speaker 1: Time, definitely, Carol, this is a pleasure to be back
Speaker 1: in your program, so thank you very much for having me.
Speaker 3: How are you doing? Tell us what the last few
Speaker 3: years have been like and where you are where and
Speaker 3: how it compares to where you are a pre pandemic.
Speaker 1: Well, as team was just mentioning, we are in a
Speaker 1: very good position. Of course, we have completely recovered from
Speaker 1: the volume of tourists or the tourists, and there's been
Speaker 1: different trends. We continue to grow in a steady and
Speaker 1: sustainable way and that's definitely a very good position to
Speaker 1: be and we're waiting to have a fantastic summer.
Speaker 4: The summer, as you know, is just starting.
Speaker 1: The weather is very nice and a lot of different
Speaker 1: activities that you can do enjoying this fantastic weather that
Speaker 1: we have in the Los Cagos area.
Speaker 2: Well, year round weather's good there, but give us an
Speaker 2: idea of how important summer is and sort of the
Speaker 2: peak seasons for you.
Speaker 1: Well, we are a destination that we never run completely full.
Speaker 1: So it's not a destination that is at one hundred
Speaker 1: percent capacity because it's not.
Speaker 4: A massive destination.
Speaker 1: We prefer quality than quantity, however, and the weather, as
Speaker 1: you mentioned, is very mild because it's low humidity year
Speaker 1: round of low commidity, so we never have a big
Speaker 1: humidity that is affecting the destination. But we have a
Speaker 1: big season that is in the winter, around the holiday season,
Speaker 1: and then the summertime. The south of the United States
Speaker 1: travels to Los Cabos, So we also have a peak
Speaker 1: in July and August. Especially the states like Texas, Arizona,
Speaker 1: New Mexico, California, they travel to Los Cabos in the summertime.
Speaker 1: And let's say the north part New York, Illinois and
Speaker 1: the North Park, Mississippi, with all that part travels in
Speaker 1: the winter.
Speaker 2: I'm curious about the new hotel rooms that are coming
Speaker 2: online in the coming years because you said you focus
Speaker 2: on quality, not quantity, but you have quite a quantity
Speaker 2: of rooms coming on in the next few years. You've
Speaker 2: got seventy rooms at the Soho House and Beach Clubs
Speaker 2: that to open this year, one hundred and twenty rooms
Speaker 2: at the Saint Regions Cabos this year, next year, two
Speaker 2: hundred rooms at the Park Hyatt. Then you got fifty
Speaker 2: five rooms and then another hotel coming in twenty twenty seven.
Speaker 2: At what point does it become too crowded? Is that
Speaker 2: a concern for you?
Speaker 1: Well, no, because you know exactly check the number of
Speaker 1: rooms that you are mentioning. If you compare it to
Speaker 1: any other destination. Instead of having seventy they have seven
Speaker 1: hundred or two thousand rooms. So we exactly the model
Speaker 1: of the hotels that are coming into Loscalos that we
Speaker 1: currently have is between one hundred and two fundred rooms.
Speaker 1: So we have eighteen thousand rooms in total and we
Speaker 1: are expecting seven hundred more so in the in the
Speaker 1: next two or three years. And because of the names
Speaker 1: that you just mentioned in terms of the investment, they
Speaker 1: are definitely.
Speaker 4: Quality properties that are very different from one to each other.
Speaker 1: So each of them are trying to attract a different
Speaker 1: niche of traveler. Some of them would be more focused
Speaker 1: on high end astronomy, more on the rustic experiences in
Speaker 1: the middle of a natural preserved area, So all of
Speaker 1: them have some differences on but we have the area
Speaker 1: as we are in the deep south of the Waka Peninsula.
Speaker 1: We have the largest postline with the Pacific and the
Speaker 1: Sea of for Tests, and the two of the two
Speaker 1: bodies of water are completely different. So if you're staying
Speaker 1: in the Pacific side and you see sunsets, and if
Speaker 1: you're staying in the Sea of What Tests, you see
Speaker 1: sun rises. So the temperature of the water, the natural
Speaker 1: beauty is.
Speaker 4: It's very different.
Speaker 1: So you can move from one part to the other,
Speaker 1: so you can have breakfasts in the Pacific and then
Speaker 1: have launch on the other side.
Speaker 5: Sign me up.
Speaker 2: Let's get right back to Rodrigo Esponda, managing director of
Speaker 2: the Los Cobos Tourism Board, joining us from Los Cabos, Mexico. Okay, Rodrigo,
Speaker 2: forgive us, but we gotta go here because I have
Speaker 2: a colleague who absolutely flat out refuses to go to Mexico.
Speaker 2: He's concerned about crime, he's concerned about the headlines that
Speaker 2: he sees. And I was doing some research about the
Speaker 2: and I looked into it, and I just want to
Speaker 2: give you some startling figures. Our going president Amlo presided
Speaker 2: over the bloodiest term in the country's recent history, more
Speaker 2: than one hundred and seventy thousand homicides from twenty eighteen
Speaker 2: through March. Even this year's election was affected of some
Speaker 2: thirty seven political candidates were murdered. What would you say
Speaker 2: to people who see that news, see those headlines, and
Speaker 2: are concerned about potential violence in Mexico.
Speaker 1: Well, we are definitely aware of some challenges in certain
Speaker 1: areas in Mexico, however, the truism destinations are perfectly fine,
Speaker 1: and in Los Cabos in particular, safety and security has been.
Speaker 4: A top priority. So if you go back to.
Speaker 1: Many year, seven years or eight years, in terms of
Speaker 1: Los Cabos, we have consistently ranked as the safest municipality
Speaker 1: among the one hundred that our mercier in Mexico. So
Speaker 1: even though that we're aware of those challenges in the
Speaker 1: truism destinations, the visitors are fine, and Indos Catos in particular,
Speaker 1: we make it a big priority. And we were just
Speaker 1: discussing about the big investments that are coming. Precisely Induscoutols
Speaker 1: are coming those investments because the safety conditions, the rule
Speaker 1: of law, and the weather and the proximity to the
Speaker 1: United States make it very attractive.
Speaker 2: To to what extent though, do those headlines and those numbers,
Speaker 2: in your view drown out potential visitors who say, you
Speaker 2: know what, I'm too scared to go. Do you think
Speaker 2: that happens?
Speaker 4: Well, I would go.
Speaker 1: Back to the State Department travel warning, and as you know,
Speaker 1: all over the world, the State Department makes it very
Speaker 1: particular recommendations for travelers. In the case of Mexico, we
Speaker 1: are the only country that clearly differentiates by states and
Speaker 1: by rigs, so I would go back to precisely consulting
Speaker 1: checking those and if you will review it, the truism
Speaker 1: destinations are fine. And in the other areas, because Mexico
Speaker 1: is a very large country, the State Department makes it
Speaker 1: very clear the areas that travelers should go or should
Speaker 1: not go, and it makes specific recommendations even in the highways,
Speaker 1: the areas, the time frame or specific conditions that the
Speaker 1: travelers need to follow.
Speaker 4: So I would abide to that, and.
Speaker 1: In our case, in the case in the case of
Speaker 1: Los Cabos, has been consistently a top rank area to
Speaker 1: visit and it will continue to do so because we
Speaker 1: work very hard.
Speaker 4: To make sure. I'm wondering.
Speaker 2: You know, we talk a lot about national politics on
Speaker 2: our show, so I want to talk about national politics
Speaker 2: in Mexico. We've covered Claudia Shinbaum's victory becoming the first
Speaker 2: female president in the country's two hundred year history. She
Speaker 2: set to take office later this year. Are you optimistic
Speaker 2: that she could improve the numbers that I shared with
Speaker 2: our audience earlier, that she will make the country safer?
Speaker 1: I think the positive feeling in Mexico in general after
Speaker 1: the election has been very good. She as you know,
Speaker 1: she comes back from the scientific background, so she's going
Speaker 1: to be the first president that would have a PhD
Speaker 1: in Mexico, which is something that is a resemblance of
Speaker 1: the advance that the knowledge and the education has been
Speaker 1: having in the country. Is the first woman and only know,
Speaker 1: I think the positive feeling in general for the science
Speaker 1: the technology. She just also mentioned on the different members
Speaker 1: of the cabinet, so she has even created another ministry
Speaker 1: that would be just dedicated on the science and the knowledge.
Speaker 1: So I think that's a reflection. And in the case
Speaker 1: of tourism, I'm sure that precisely because of her background,
Speaker 1: it would be a way to improve in general the conditions.
Speaker 1: The average level age of Mexico is twenty eight years old,
Speaker 1: so we are a very young country and precisely what
Speaker 1: we need is just to continue working very hard to
Speaker 1: the conditions to have a better way of living. Tourism
Speaker 1: provides that in general, one out of ten jobs in
Speaker 1: the country in Mexico are created or are related to tourism,
Speaker 1: and I'm sure that this would continue. The tourism area
Speaker 1: is the first employer for the young people when they
Speaker 1: leave college so they have some technical profession and also
Speaker 1: is the second one in terms of women employment of
Speaker 1: So the level of conditions that you can provide and
Speaker 1: to improve in Mexico are definitely connected to the level
Speaker 1: of tourism and the many visitors that we receive.
Speaker 3: But we go if there is one policy you could
Speaker 3: change in your country to help even more the tourism industry,
Speaker 3: as you say and shared with us some statistics, ninety
Speaker 3: percent of people rely directly or indirectly on the tourism
Speaker 3: ministry and those cabbos. If there was something you could
Speaker 3: change or have the government help you folks with, is it?
Speaker 3: Is it the crime area? What would it be?
Speaker 1: Well, you know, as I was mentioned, because in the
Speaker 1: case of Los Cagos, we don't have any crime statistics.
Speaker 4: But you know, all it takes.
Speaker 3: All it takes is one bad thing within the country
Speaker 3: or in the tourist areas, and it doesn't matter where
Speaker 3: it is. People just lump it all together.
Speaker 1: Well, definitely, if the safety conditions in general are improved
Speaker 1: in the country, that would be better off, not only
Speaker 1: if for tourists but for in general for the community.
Speaker 1: But one area that I believe that would be very
Speaker 1: good for tourism in general. It's energy, and precisely, the
Speaker 1: president comes back from the energy and the environmental studies.
Speaker 4: That's what she has as a PhD.
Speaker 1: So we believe that if there is some connection to
Speaker 1: improve the energy in terms of naked much more sustainable,
Speaker 1: and we have that conditions related to tourism, it would
Speaker 1: be better because then it would be more sustainable, it
Speaker 1: would be more efficient, and it would be more economical
Speaker 1: for all. So hopefully that would make the cads that
Speaker 1: we would be having. With the weather that we have,
Speaker 1: it's very easy to have solar panels and many other
Speaker 1: sustainable ways of producing energy. Besides, definitely I agree that
Speaker 1: the conditions of safety in general the country needs.
Speaker 4: To be broken, all right.
Speaker 3: Good to know, good to know. One thing I am
Speaker 3: curious is who is traveling to Los Cabos. Has the
Speaker 3: demographics of who is coming? Has that changed it all?
Speaker 5: Since the pandemic it has dramatically change and now forty
Speaker 5: five percent of our travelers are millennials from twenties to
Speaker 5: thirties and not only traveling to Los Cabos, And.
Speaker 1: That's very interesting because they are also investing they are
Speaker 1: buying second homes. In many of the hotels that we
Speaker 1: were mentioning at the beginning, they have residential homes as
Speaker 1: part of their hotels. So then you buy arrested that
Speaker 1: is part of one of these branded hotels, and they
Speaker 1: use it partially during the year. You can block it
Speaker 1: and then you pass it to their property to the
Speaker 1: hotel in order to have as an income.
Speaker 4: So it's been changing.
Speaker 1: Also, people have been traveling more looking for sustainable practices
Speaker 1: for wellness, for gastronomic experiences, for community engagement. So those
Speaker 1: friends have been dramatically changing, and the age of the
Speaker 1: travelers have been getting Junger.
Speaker 3: What can I just ask you? Is it largely Americans? Europeans?
Speaker 2: The mix?
Speaker 3: Has that changed at all? Just quickly?
Speaker 1: No, it's Americans. Eighty percent of our travelers are Americans,
Speaker 1: mainly California, Texas, New York, Illinois.
Speaker 4: That are our main markets.
Speaker 2: Hey talk to us a little about the airports and
Speaker 2: the flights and availability of flights. Is that is the
Speaker 2: airport and a lack of new flights. Is that restraining
Speaker 2: you at all?
Speaker 1: Well, we've been we have very cities in the United
Speaker 1: States with non stop to Los Cabos, which is definitely
Speaker 1: something that we've been working very hard. There are some
Speaker 1: pockets in the United States that we're still working for
Speaker 1: example Boston or Miami that we need to have an
Speaker 1: on stop flight. But besides those two areas, we have
Speaker 1: three cities, and the airlines have been also expanding, not
Speaker 1: only in the routes in the number of flights daily
Speaker 1: that they have, but also in the number of seats.
Speaker 1: The airplanes have been getting more efficient. After COVID, there
Speaker 1: is a new generation of planes that are in the
Speaker 1: market and that is also been.
Speaker 4: Providing more travelers.
Speaker 1: But of course that continues to be the case that
Speaker 1: there are more opportunities for more travelers looking to flight
Speaker 1: in shorter distances through different different parts.
Speaker 3: All Right, Rodrigo, thank you so much, really appreciate you
Speaker 3: spending a lot of time with us. On this Monday, we.
Speaker 2: Go remote from.
Speaker 3: Have to trust my arm on that line. Rodrigo Esponda,
Speaker 3: he is managing director of the Los Cabos Tourism Board,
Speaker 3: joining us from Los Cabos, Mexico. I've been to Mexico
Speaker 3: a ton of inside California, did you guys, It was
Speaker 3: just a piece of cake, a piece of cake like
Speaker 3: drive or
Speaker 2: Did you I never drove, I've ever driven through the border.