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 The lowest fares to San Juan, Puerto Rico, have fallen 22 percent
on average from a year ago, according to an early February analysis
of six of the busiest U.S. domestic routes to the island's capital
by Harrell Associates, shared exclusively with Reuters.
The drop outpaced an 18 percent fall nationwide in the
high-restriction fares during that time, according to the travel
consultancy's analysis.
"It's a combination of slack demand in both directions," said Robert
Mann, an airline industry consultant.
"Leisure travelers going to Puerto Rico are concerned both about the
state of the economy and the extent to which leisure resort
facilities are going to be properly maintained," he said. "If you're
a Puerto Rican resident, the buying power just isn't there."
With a stagnating economy and an exodus of its population to the
mainland, the U.S. territory has defaulted on part of its $70
billion in debt and asked its creditors to renegotiate the borrowing
terms to slash its debt burden.
 Puerto Rico is also one of 28 countries and territories in the
Americas battling the Zika virus. It reported 63 cases as of Feb.
18, and U.S. health officials expect many thousands of residents to
contract the virus once the mosquito season peaks this summer.
"Mosquito-borne viruses are a severe and immediate threat to the
health and safety of my constituents," the territory's
representative to Congress, Pedro Pierluisi, said in a statement on
Tuesday, urging the U.S. government to help reduce threatening
mosquitoes on the island.
CONFERENCES CANCELED
Harrell Associates data showed the lowest fares to San Juan already
dropped more than 14 percent in early February from a month before,
following a Jan. 15 travel advisory for pregnant women from the U.S.
Centers for Disease Control and Prevention. Fares slipped only 1
percent nationwide during this time.(http://tmsnrt.rs/1QwvgNN)
Scientists are investigating a potential link between Zika
infections of pregnant women and more than 4,000 suspected cases in
Brazil of microcephaly, a condition marked by abnormally small head
size that can result in developmental problems.
Airlines have yet to report lower bookings due to the virus.
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Frank Comito, chief executive of the Caribbean Hotel and Tourism
Association, said a recent study that found bookings were down 3.4
percent to Zika-hit regions had made a causal "leap," noting factors
such as hot January weather and global economic uncertainty.
However, three conferences at major Puerto Rican hotels were
recently canceled and one postponed because of concerns over the
virus, costing the island 1,969 hotel-room nights, said Joyce
Martinez, vice president of business development and sales at
nonprofit Meet Puerto Rico.
Puerto Rico hosts an estimated 20 to 30 conferences each month, she
said.
Data suggests fares have fallen not from a surge in seat supply but
because airlines want to stimulate demand.
According to Harrell Associates, the one-way fares excluding taxes
and fees dropped 36 percent in early February from a year ago to $80
from New York Kennedy, a hub for JetBlue Airways Corp <JBLU.O> and
American Airlines Group Inc <AAL.O>.
There was a 1 percent reduction in seats on the route in this
period, aviation data and analytics company OAG said.
JetBlue, the largest airline in San Juan, and American declined to
comment on pricing or whether either would reduce service to the
island.
At American's Philadelphia hub there was a 40 percent drop in the
fares to $125, buoyed partially by a 13 percent rise in seats.
Atlanta flights had a 15 percent reduction in seat supply and the
only fare rise, up 21 percent.
(Additional reporting by Toni Clarke in Washington and Megan Davies
in New York; Editing by Matthew Lewis)
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