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After forcing workers back to the office, Goldman Sachs and JPMorgan Chase are now letting their staff work remotely—but only for the World Cup

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Cuba

U.S. Airlines Will Face Major Turbulence En Route to Cuba

By
Anne VanderMey
Anne VanderMey
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By
Anne VanderMey
Anne VanderMey
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February 18, 2016, 11:50 AM ET
U.S. Considers New Sanctions On Cuba Over Dissident Crackdown
Photograph by Jorge Rey — Getty Images
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On Twitter Thursday morning, President Barack Obama announced a planned trip to Cuba, a historic excursion that would be the first by a sitting president in 90 years. He’s just getting ahead of the rush.

Starting as soon as this fall, any American that fits into one of 12 fairly loose categories will be able to book a scheduled flight to Cuba on major carriers. Under the new rules, there will be more than 100 regularly scheduled flights to the country per day, many times more than the handful of charter flights that go there now.

Major U.S. carriers, including American Airlines (AAL), Delta Airlines (DAL), Jet Blue (JBLU) and United (UAL) have already announced intentions to apply for the newly available routes to Cuba, USA Today reports. A spokesman for American Airlines, which currently offers the most charter flights to Cuba, said that it was early to gauge what demand would be, but that it would move quickly to add routes, calling the agreement a “great opportunity.”

The new flight paths are part of a major thaw in Cuban relations touched off by the Obama administration that will leave the U.S. and Cuba closer politically and economically than they have been in 50 years. There are huge hurdles to normalizing relations, though, not the least of which is a Republican Congress. At a town hall on Wednesday, GOP presidential candidates Marco Rubio and Ted Cruz lambasted Obama’s approach to the country. “He’s allowing billions of dollars to go to tyrants who hate America,” Rubio said. And though many businesses are slowly making in roads on the island, most will be blocked for the foreseeable future unless Congress lifts the embargo (not likely any time soon).

For Americans that do make their way there, decades of Communist rule and neglected infrastructure present significant hurdles. Big airlines will have to find a way to operate even though no U.S. credit cards can currently be used in the country, making it difficult to pay for checked bags, flight changes, or other amenities. There’s virtually no mobile Internet, and booking flights on the island is not for the faint of heart (it’s not unheard of to have to visit the airport in person and even furnish an employee with cash to secure a seat quickly). What Internet there is in the country tends to be expensive and slow. And the main Havana airport is aging—not to mention there’s only one runway.

Henry Harteveldt, travel industry analyst and founder of Atmosphere Research, says airline companies are now scouting the country’s airports to determine how feasible the new flight routes will be. “They’ll be looking at everything from connectivity to language proficiency,” he says. And the stakes are high: If Cuba handles the first wave of tourism poorly, it may blow its chance at future ones.

“If they don’t get this launch right it could set their tourism launch back by several years,” Harteveldt says. “It will have a terrible reputation and it will squander this literally once-in-a-lifetime opportunity.”

 

Colorado-based aviation analyst Michael Boyd says he’s not worried about airports being overrun by Americans—but only because he thinks the hotels will keep them out first. “There are more hotel rooms on the Las Vegas strip than in all of Cuba,” Boyd wrote to Fortune in an email. “And the quality is pretty low.”

Right now, Boyd says Cuba “is a place for adventure tourism, not mass travel.” That is, at least until major investments are made in infrastructure and tourism amenities. Here’s hoping it doesn’t take another 50 years.

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