The ban on non-essential travel across the land border between the U.S. and Mexico has uninterruptedly continued to be renewed on a monthly basis since its inception in March 2020.
Leading data and analytics company GlobalData's latest report, 'Tourism Source Market Insight - United States' suggests that its continuation 17 months into the pandemic could potentially prove devastating for Mexico's tourism industry.
Its research revealed that, in 2020, the United States was the source market for Mexico that spent the most on outbound travel, with the average spend per U.S. resident amounting to $3,505. Another North American neighbor, Canada, was the source market with the second-highest level of average expenditure at $1,576 per resident. Colombia came in third with $1,286 in average spending per resident.
Rheanna Norris, Travel and Tourism Analyst at GlobalData, said: "While the Mexican Government is allowing travel into the country, restrictions on outbound travel are being applied by the U.S. Since the U.S. is by far the highest spending source market for visitors, significantly ahead of other important source markets, such as Argentina, Colombia and the U.K., Mexico's tourism industry will feel the restriction of non-essential travel from the U.S."
Evidencing Mexico's reliance on the U.S. outbound tourism market, GlobalData found that 83 percent of all arrivals into the country came from the U.S.
However, the GlobalData survey also discovered that many overseas tourists are willing to travel long-haul for their post-pandemic vacations. Out of 1,442 survey participants from around the world, 37 percent responded that they are willing to go to a different continent on their next international trip.
In the short term, this suggests that the Mexican tourism industry might be able to lean on the long-haul holiday market to somewhat make up for the loss of U.S. dollars if it's able to target travelers who are eyeing a 'bucket list' type of trip post-COVID. Even so, GlobalData indicated that Mexico's tourism sector may struggle to compensate for the absence of the typically high-spending U.S. traveler.
"Despite the current restrictions, Mexico could experience a surge in visiting friends and relatives (VFR) travel from the U.S. when it is fully permitted, as this is a top motivator for travel between the two countries," Norris said. "Travelers may, however, experience a hike in airfares due to the sudden increased demand. However, the desire to see loved ones after so long will encourage travelers to pay these high prices, benefitting airlines."
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