Joan Pascual Comas, Director of NT Incoming
Joan Pascual Comas is the director of NT Incoming and he has worked with Natalie Tours since 1993, the first tour operator in Europe’s destinations. Caribbean News Digital sat down with him in this exclusive interview within the framework of MITT 2015. Mr. Pascual said, among other things, that Spain is likely to have a fruitful summertime because, according to forecasts, the country works with tour operators from Great Britain, Germany, France, Central Europe, and sales are doing well, except for the Russian market.
There is concern around the market in terms of the solvency of Russian tour operators and their payment credibility. How does this matter affect Natalie Tours’ relations with Spanish hoteliers and service providers?
2014 was a catastrophic year in Russia. They have undergone the perfect storm. They’ve had problems in their relation with Europe, some tour operators have gone bankrupt, and they have coped with economic difficulties. All of the tour operators, without exception, have lost a lot of money. Some of them have gone bankrupt, some have held their ground. My guess is that, if they have to go through one or two years like 2014, none of them will make it.
The truth is that some tour operators have solved their economic problems and have prevailed. Some of them have paid, others have used down payments. Sales are on the go. Over the past two or three weeks the situation has gotten better with the rise in the ruble-euro parity and that obviously contributes to the cash flow, as there is money coming in and the tour operators are being kind of backed up.
If the pace remains stable or goes up like it has over the past weeks, we’ll see a happier summertime. None knows what could happen if there is another crisis with Ukraine, they go into military matters or oil prices go down.
How is the atomization affecting the inbound offer in the Spanish market, as a result of the close of important inbound agencies, in terms of the Russian market?
I think that the national market is not to be globalized. There are areas like Baleares, for instance, where sales are going great. The same happens with Costa del Sol. The competition is common in the market: law of supply and demand. There are other areas, such as Costa Dorada, where the number of available beds is going to be high because of the fall in the Russian market, so the prices will go down.
Baleares, Costa del Sol, Canarias are paying minimum quotes of handling fee. Another matter is related to tour operators or big inbound agencies that have lost their portfolio of customers and they have no other choice but joining this, let’s say, “disloyal” price war.
I would say that Spain is going to have a positive summertime. According to our forecasts, in our relation with tour operators from Great Britain, Germany, France, Central Europe, all of the markets except for the Russian one, sales are giving positive outcomes.
There was a general inbound agency, five employees went out and kept ten hotel groups, each of them with different prices. They have no structure, they don’t pay taxes. How does an important tour operator like you feel this?
This disloyal competition has always been there, not only in the national market, but in different markets. I believe that they are spring flowers. They will vanish with either hot or cool times. Spain’s tax system and labor control has to regulate this situation. There is a growing number of inspections to the travel industry and, although we personally feel it, I’m grateful. Everybody is to fulfill tax and labor obligations; we must play with the same rules. That’s when those people are going to be out of the picture.
Natalie Tours’ decrease in terms of the Russian market for Spain, especially Catalonia, was nearly 30 percent in 2014.
It was 27 percent for Spain as a whole. It’s been higher or lower in different areas. It was actually lower in Catalonia because it had higher volume: 32 – 33 percent.
What has the other area with the highest fall been?
All of Europe’s destinations are expensive and euro destinations. Italy has gone down, as well as Greece and Cyprus.
In Spain, what’s the second destination with the highest decrease?
Taking into account that they work the year around, summer-winter season, Canarias Islands are the second destination. This winter season was very bad for the Canarias Islands.
What would the most affected destination in Italy be?
Italy is not a sun-and-beach destination, but a cultural circuit product. The tourists arrive in the north region of Italy and they take the typical five-or-six-night tour. They have also experienced a decrease, because those products are not cheap as they include five days in hotels, excursions.
Could the Caribbean have an upturn due to this crisis in Spain?
It’s a dollar destination and dollars are expensive; it’s a long haul destination, 12 hours from Moscow. The plane ticket is very expensive. As for the forecasts for summertime, we’ve seen that Cancun is shy of flights.
A 70 percent decrease?
Over 70 percent. There were 16 flights from the Russian Federation to the Dominican Republic. I believe that they now have only seven and the trend seems to go down to 4 or 5 flights. That the summer prediction.
We’ve heard that Cancun – Riviera Maya have reported a 70 percent fall and the same happens with the Dominican Republic.
That’s right. And Cuba goes in the same direction. The problem is the loss of the purchasing power by part of the Russian population.
Nevertheless, the Russian tourist that used to travel 10 years ago presently does the same. The expense has been higher in Spain.
I would say that the middle-high class in Russia has changed, but the decrease has been limited. The middle-high class is the one that has suffered the most and the middle class has gone low. That’s the one that has received the hardest hit and those were the people that used to spend two years working so as to enjoy their vacation in Europe, whether it’s Italy, France or Spain. They have lost every possibility to travel.
Is there any movement in Russia related to the birth of a big tour operator, thus taking the space left by those that are gone?
There’s nothing. There was some action. Thomas C. made its move, TUI Russia with VKO. I think that the operation hasn’t been very successful. The numbers are clear and I doubt that, at least in the short term, there is any group interested in encircling the market. My guess is that they are waiting for a couple years to see what happens. It’s a 140-million potential market.
What do you make of sales in Russia by means of home travel agents?
It’s a culturally and technologically mature market, with such obstacles as the visa. The visa, for example, for European destinations is a huge obstacle. It’s actually easier to get your visa by means of a tour operator, instead of buying online or by using new technologies. When travelers get the visa, they have to go to the embassy of their destination country, make the lines, go one day, and go again. It’s very complicated and that situation paves the way for tour operators.
Without the visa issue, the online market would be amazing in Russia. But it seems that we’ll have visas for a long time and it’s getting more complicated with biometric visas.
There are nearly 30 thousand travel agencies in the market.
I would say that there were some 30 thousand three or four months ago. Nowadays, I’d dare to say that 10 – 15 percent of them have disappeared.
Is there any action to be taken if situations like wars or the lack of safety continue in the Middle East? Do you think that those elements could encourage Russian tourists to travel to Spain or Italy, instead of those destinations?
No. I’ve talked about this with colleagues from the Russian Federation and they have it very clear. They say: “tell me about lack of safety as we have Chechens and political assassinations in the streets, day by day”. Unlike us, they are not afraid of traveling to those destinations. Egypt is an example. Egypt is an Islamic country, it’s very cheap and it’s the best sold destination in the Russian Federation.
Is there anything else you’d like to share with us on the Russian market?
The Russian market has been active for 22 years, since it began in Europe with constant growth of 20, 30 or 40 percent year in year out. We faced an economic crisis in 2007 and 2008 with the devaluation of the ruble and it was left behind. It has nothing to do with the present crisis. It’s deeper, more temporary and I’d like to urge everybody not to forget this market that has given us so much.
We have to take it seriously, use all means with official organisms, hotels, private industry, in an effort to minimally maintain this market throughout the two or three years that are forecasted to be negative, because I think that there is tremendous potential and we should support that market.
Do you think that the Spanish visa issuing process has been substantially improved?
Yes, it has. The Spanish embassy is the best one in terms of facilities, means, promptness, rectitude. It still represents an obstacle, but we gave to be thankful to the Spanish embassy because all tour operators mention it as an example.
Has Natalie Tours Spain thought about taking part in any other hotel group or service company?
Natalia, Vladimir and I are partners in Natalie Tours Spain and it’s a company. We individually participate in some hotel operations and work with some service companies.
Is Natalie Tours Spain buying rooms or hotels so as to improve the operations?
Yes. Some operations and contracts have been signed with guarantee. We have narrowed it down to minimum levels and coveted products, very exclusive products.
