Cruise news from Los Cabos: Tariff terror?

2025 should beryllium a twelvemonth of solemnisation successful Cabo San Lucas. The metropolis has been a featured larboard connected Mexican Riviera cruises for 60 years, dating backmost to the mid-1960s, erstwhile Princess Cruises invented the conception earlier sharing it wide with U.S. tv viewers via the long-running 1970s and 1980s amusement The Love Boat, filmed aboard a Princess cruise ship.

To grant the 60th twelvemonth of Mexico Riviera cruises, Princess is readying a peculiar 14-day Diamond Anniversary voyage departing December 6 from the Port of Los Angeles, with 2 overnight stays successful Cabo San Lucas and Puerto Vallarta and visits to different fashionable destinations specified arsenic Loreto, Manzanillo, and Mazatlán. 

Cabo San Lucas has been a larboard of telephone connected Mexican Riviera cruises for 60 years. (Princess Cruises)

Tariff concerns formed a pall implicit the cruise manufacture successful Mexico

However, on with the solemnisation 2025 is besides a twelvemonth of concern, not lone for Cabo San Lucas but different fashionable cruise ports successful Mexico. That’s due to the fact that of a new tariff expected to instrumentality effect connected July 1 (after being delayed from an archetypal commencement day successful December 2024). No, this 1 isn’t courtesy of the U.S. President but alternatively the Mexican Senate, and if it is enacted arsenic expected it volition enforce a US $42 taxation connected each idiosyncratic who takes a Mexican cruise. Even those who don’t get disconnected the vessel to bask larboard visits.

Most of the wealth raised from this measurement (66%) is earmarked for the Mexican military, not to money improvements successful larboard facilities. But adjacent if it were, the cruise manufacture and tourism officials successful Mexico would apt person the aforesaid response. Namely, disapproval and pushback owed to the expected deleterious effects this complaint — 1 of the highest by immoderate state — is apt to have. 

The tariff’s effect connected Mexican ports of call

The tariffs are apt to origin a important spike successful the outgo of cruise arrivals, rendering the portion uncompetitive for cruise companies. (IGY Marinas)

In a missive to Mexican President Claudia Sheinbaum, the CEO of the Florida-Caribbean Cruise Association, Michele Paige, stressed the antagonistic impacts this tariff she believes this tariff volition have, peculiarly successful Mexico, and pointed retired it would marque the state 213% much costly than the mean larboard of telephone destination successful the Caribbean, and frankincense not competitive.

“The Government’s program to destruct the ‘in-transit’ exemption presumption that has been successful spot for cruise passengers for implicit a decennary impacts the livelihoods of tens of thousands of Mexican citizens, countless tiny businesses, and communities on Mexico’s coastlines that beryllium connected cruise tourism.”

The interest is understandable, fixed that cruising is worthy US $500 cardinal to Mexican larboard economies annually. Octavio de la Torre, president of CONCANACO (the National Confederation of Commerce, Service, and Tourism Chambers), enactment it much bluntly, per The Associated Press: “This could effect successful a important alteration successful visitors.”

What mightiness the tariff mean for Cabo San Lucas?

Cabo San Lucas is economically babelike connected tourism, overmuch of which comes from cruise vessel arrivals. (Sectur/Twitter)

Paige specifically pointed retired the impacts successful Quintana Roo, location to Cozumel, the country’s astir fashionable cruise larboard destination, and wherever cruising accounts for 40% of the GDP statewide. But Cabo San Lucas, which sees astir fractional a cardinal cruise vessel visitors annually, could besides beryllium hard deed successful manifold ways, including reduced cruise postulation from cruise ships and altered itineraries that omit Cabo San Lucas and different Mexican ports of call, starring to mislaid jobs and mislaid gross for section businesses. 

Another anticipation is reduced concern successful larboard infrastructure. It’s improbable that this tariff volition impact the 688 cardinal pesos already allotted for infrastructure improvements betwixt 2024 and 2029 via the Secretaría de Marina’s Programa Maestro de Desarrollo. However, if Cabo San Lucas and Ensenada, the 2 astir important Mexico Riviera cruise ports, spot a important diminution successful visitors moving forward, this could impede investments from different sources.

What could pushback look similar erstwhile the tariff goes into effect?

Iceland discovered the antagonistic effects of cruise tariffs erstwhile it tried to instrumentality its own. (MBL)

Do you deliberation tariffs aren’t taken earnestly by the cruise industry? Just look astatine what precocious happened successful Iceland, wherever a humble $18 tariff was imposed successful January 2025. Cruise ships instantly began canceling visits. Tourism officials, arsenic successful Mexico, had cautioned the Icelandic authorities that specified a tariff would person antagonistic impacts, but to nary avail. 

A well-placed section root confirms cruise lines are up successful arms implicit the Mexican tariff and that reduced visits are a existent possibility. In the meantime, each caller itineraries to Mexico are connected clasp pending immoderate benignant of agreement. But that’s lone fractional the equation. Consumers whitethorn besides rethink the Mexican Riviera since these are typically much budget-friendly cruises; thus, the precocious tariff represents a overmuch greater percent of the full cost. 

Tawnee Sons, co-owner of Florida’s cruise-focused World2Sea, notes that taxes and fees person doubled successful caller years truthful this latest tariff could trigger a tipping constituent for Mexico astatine a clip erstwhile its ports are already seeing somewhat little interest. 

“The inclination is present shifting toward destination-based travel, further diminishing request for Mexican ports of call,” she explained, via Travel Weekly. “Given this diminution successful interest, a important (uptick) successful fees could marque these itineraries adjacent little appealing, peculiarly for families and affinity groups, who often take cruising arsenic a value-oriented abrogation option.” 

How important cruise vessel visits are to Cabo San Lucas?

Cruise tourism is the lifeblood of the region. (Cruisemapper)

Cabo San Lucas welcomed implicit 540,000 visitors acknowledgment to cruise vessel visits successful 2022, and implicit 735,000, a grounds number, successful 2023. Meanwhile, that fig dropped to 448,000 successful 2024. This alteration was expected owed to the fig of ships rerouted to the destination post-pandemic erstwhile different fashionable locales had yet to invited backmost cruise traffic. 

The existent mathematics that determines bully from large years is alternatively simple. On average, each rider present leaves astir US $100 successful section coffers per larboard visit. Thus, fractional a cardinal radical annually could mean arsenic overmuch arsenic $50 cardinal deposited successful assorted pockets successful Cabo San Lucas.

Nearly 2 decades ago, successful 2007, an impact investigation of the cruise industry successful Mexico noted US $38 cardinal successful cruise-related expenditures successful Cabo San Lucas during that azygous twelvemonth and the instauration of 1,100 section jobs. About the aforesaid fig of passengers (450,000) visited past arsenic successful 2024, truthful the cruise manufacture has remained a remarkably accordant root of gross and employment.

But Cabo San Lucas and its cruise manufacture are present entering uncharted waters.

With reports from Travel Weekly, F-CCA and Luz Noticias