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