Flight Cuts and Tight Promotion Budgets Threaten Azores Getaways

Airline routes are shrinking, promotion money is tight and hotel bookings have begun to slide—three warning lights that the Azores’ tourism machine, once Portugal’s fastest-growing, is starting to sputter.

Quick read

• Guest numbers dipped 2% in October, breaking an 18-month growth streak.

• Madeira is spending €16 M on promotion in 2026; the Azores just €8.02 M.

• Ryanair’s departure in March 2026 removes six low-cost routes and about 400 000 seats.

• Uncertainty clouds the privatizations of Azores Airlines and TAP.

• Business leaders warn of a "lost year" without immediate action.

Snapshot: why the islands suddenly lag behind

Twelve months ago the Azores were posting record figures—4.3 million overnight stays in 2024 and close to 1.3 million guests. Yet by the tail end of 2025 the tide turned. October’s slip in both foreign and, more worryingly for São Miguel hoteliers, domestic stays (-7.7%) hints at a deeper malaise. Analysts tie the reversal to weak winter marketing, a slowdown in Portuguese disposable income and the region’s traditional dependence on nature-centric summer travel.

Budget gap vs. Madeira’s war chest

Money for getting the word out is where the archipelagos diverge most sharply. The Azorean promotion agency VisitAzores will work with €8.02 M next year—barely half the sum Madeira sets aside. The Atlantic neighbour has long treated communication as strategic infrastructure: consistent campaigns, year-round events, and a dedicated digital push funded to the tune of €16 M in 2026, with another €29.7 M earmarked for broader tourism projects. Local entrepreneurs in Ponta Delgada argue that matching those figures is impossible, but say that doubling the current allocation would already bring the islands back into travellers’ feeds.

Airlines: the fragility of island skies

Air connectivity, the lifeblood of any oceanic destination, faces a triple shock:

Ryanair pulls out on 29 March 2026, citing airport charges. Six international routes vanish, depriving the archipelago of a budget gateway to Brussels, London and Porto.

The privatization of Azores Airlines (SATA) drags on. Auditors flag cumulative losses of €486 M, and unions fear cost-cutting will trim frequencies between the nine islands.

Lisbon’s plan to sell up to 49.9% of TAP raises the question: will a new majority owner nurture or neglect the Lisbon–Ponta Delgada and Lisbon–Terceira shuttles that residents rely on?

Civil-aviation analyst Pedro Castro frames the dilemma bluntly: “Lose low-cost traffic now, and premium carriers alone won’t fill the gap.”

Government’s rescue blueprint

The Regional Executive vows to throw €403 M at tourism, mobility and infrastructure in 2026—a hefty 32% of public investment. Key pillars include:

• Combating seasonality: incentives for off-season events across all nine islands.

• Sustainability certification: pushing for Destino Turístico Sustentável Gold Level II by end-2025.

• Trail upgrades and port revamps funded by the EU’s PRR and PO Açores 2030 envelopes.

• Marketing refresh: aligning the next Plano Estratégico e de Marketing do Turismo dos Açores with higher-end segments seeking adventure, whale-watching and volcanic wellness.

Officials admit, however, that the programme hinges on full execution of EU funds and on stabilising air links—neither of which is fully under their control.

What it means for Portugal’s tourism map

For mainland residents, the Azores have been the alternative to Algarve beaches, a short-haul escape with a different accent and lower crowd density. Should growth stall, pressure will intensify on Lisbon, Porto and Madeira airports already operating near capacity during peak months. Furthermore, a downturn could dent national goals of reaching €27 B in tourism revenue by 2026, given that the islands currently generate about 5% of the country’s overnight stays.

What business leaders want now

The Azores Chamber of Commerce lists four immediate steps it believes can avert a slide into negative territory:

• Emergency marketing top-up to raise the 2026 promotion budget past €12 M.

• Bridge agreements with TAP to secure seat supply after Ryanair exits.

• Fast-track authorization of the Azores Airlines sale with transparent milestones.

• Creation of a public-private task force that meets monthly to monitor bookings, airfares and yield management.

Without such moves, hoteliers warn, the archipelago could face a “tourism recession” just when mainland Portugal and Madeira are setting new records.

The bottom line

For Portuguese travellers planning their 2026 breaks, the Azores may still offer lush crater lakes and untamed coastlines. Yet unless the region quickly restores visibility, affordability and reliability, those emerald vistas risk being admired by fewer eyes—and the broader Portuguese economy will feel the chill.