CANCUN -- Despite Mexico's struggles this year, ALG Vacations said it has outpaced the airline industry in its top destination, Cancun.
Airlines cut capacity to Cancun by 22% from July through December. while the wholesaler's bookings fell only 5% to 10% during that period, ALG Vacations group president Ray Snisky told travel advisors at its annual Ascend conference in Cancun in late October.
A few days later at the Los Cabos VIP Summit, Snisky called Cancun "a big entry point to Mexico for U.S. citizens."
"How the country goes is really driven by how Cancun goes," he said.
Since 2024, airlines have cut 1 million seats to Cancun and 700,000 seats to Jamaica, ALG's third most popular destination.
About 70% of that drop came from the Big Four U.S. airlines: United, Delta, American and Southwest. All four plan to restore capacity to 2024 levels by next year's second quarter, Snisky said.
Cancun versus Los Cabos
ALG enjoyed momentum going into 2026 until two days of cartel violence in Puerto Vallarta in February depressed tourism across Mexico.
For ALG, Cancun took the biggest hit, despite being almost 1,600 miles from Puerto Vallarta.
Eight months later, destination leaders nationwide said visitor numbers are rebounding but still down. Visitation in Puerto Vallarta is down about 8%.
Los Cabos has fared better. Visitation from the U.S. is down 6%, although business from Canada is up, said Rodrigo Esponda, managing director of the Los Cabos Tourism Board.
Los Cabos' flight capacity for January is down 5%, while Cancun's is down 10%.
Esponda attributed Los Cabos' softness to a variety of factors: geopolitical dynamics between the U.S. and Mexico, the cost of fuel and perceptions about safety.
"All combined, it is a mix that is complex," Esponda said.
ALG Vacations has hardly seen a "hiccup" from luxury travelers visiting Mexico, Snisky said. Despite a challenging environment, ALG Vacations has added six U.S. airports for its charters.
"If you would have told me we were going to add six in this environment, I would have said you were crazy, but we found some opportunities," he said.
"With all this high air pricing, we've been able to provide a great value
proposition."
Most of the packager's charters to Los Cabos are sold out for January and February, he said.
Cancun, being a much larger destination than Los Cabos, is more focused on the mass market and is thus feeling more of the pain from cost pressures and curtailed flight capacity, Snisky said.
Mexican destinations are also dealing with a negative perception of the country, even though Los Cabos and Cancun currently are at a Level 2 advisory from the U.S. State Department (exercise increased caution). That's the same level as Italy, France and the U.K., which most Americans don't perceive to be unsafe destinations, Snisky said.
"There has been a stigma around Mexico. We have to continue to come together and change that perspective," he said.
Challenges in Jamaica
Jamaica also struggled this year as it continued to recover from Hurricane Melissa, which slammed into country in late 2025.
Other challenges have piled on in 2026, such as the economy, the war in Iran, spikes in gas prices and high airfares, executives said.
With high price sensitivity, many travelers are booking fewer excursions, traveling domestically or opting not to buy travel insurance.
"People are saying, 'Hey, I don't know if I want to spend a couple thousand dollars on excursions; I think I'm just going to go and chill out,'" Snisky said.
'Solid' business for 2027
Snisky said he sees "very, very solid" advance business for 2027 and expects airlift to ramp up in February and March before reaching a full return by Q2. Meanwhile, he said group business is "very, very" high throughout Mexico.
ALG Vacations is seeing growth in domestic travel and shorter international trips, reflecting cost pressures, said Jacki Marks, the packager's global head of trade brands.
At the Ascend 2026 conference, Marks encouraged advisors to book trips well in advance to beat further airfare increases and offer value.
ALG Vacations launched an early Black Friday sale on Oct. 23, the last day of the conference.
"With the way we're seeing '27, we have to stimulate early advance purchase because airlines are not going to drop prices," she said.
Advisors at the Ascend event said Cancun, the Dominican Republic and Jamaica are popular among their clients. While some said new customers are hesitant about safety in Mexico, other advisors said the disruption in Puerto Vallarta earlier this year is a nonfactor for Mexico tourism.
"More are worried about the seaweed than the cartel right now," said Renee Manukin, an advisor for Uniglobe from Wheeling, W.Va.