It's no secret that Cabarete's (and the north coast) tourism is not what it once was. Over the last decade there's been a string of theories as to why. The latest one that I'm hearing from business owners is that POP airport is the most expensive airport in the DR, which is why the airlines are cancelling flights.
To me that doesn't make a lot of sense.
What I understand is that airlines identify a route with demand, work a deal with the airports and offer a flight. They in turn charge as much as they can to offer that flight. The free market system ensures that if the prices (and profit) go up enough, that encourages other airlines to add that route which in turn keeps the prices in check - demand and supply.
So as a result, the flights to POP are being cancelled because there is a lack of demand, and the few flights that remain charge what they can. If there was a demand, then someone would either start offering a connector flight from PUJ, or another flight to POP from wherever the demand is.
What I am missing that the business owners look at me as if I'm from space when I say this?
To me that doesn't make a lot of sense.
What I understand is that airlines identify a route with demand, work a deal with the airports and offer a flight. They in turn charge as much as they can to offer that flight. The free market system ensures that if the prices (and profit) go up enough, that encourages other airlines to add that route which in turn keeps the prices in check - demand and supply.
So as a result, the flights to POP are being cancelled because there is a lack of demand, and the few flights that remain charge what they can. If there was a demand, then someone would either start offering a connector flight from PUJ, or another flight to POP from wherever the demand is.
What I am missing that the business owners look at me as if I'm from space when I say this?