What Tour Operators Really Want

Mallorca and the Balearics are an economic curiosity. Even compared to the principal tourism competitors in Spain - the Canaries, Andalusia, Valencia and Catalonia - this curiosity is at its most extreme. Nowhere else in Spain has the same weighting in favour of the tourism economy in GDP figures.

The dominance of this economy breeds its own curiosities. Just one of these is the high profile given to the manufacturers of this economy. Where economies and societies are more diverse, and so therefore more balanced, this profile is lessened. The words, thoughts and deeds of industrialists, financiers and others are reported, but they do not have the same power. The manufacturers of the Mallorcan economy speak as if they are the scribes of tablets of stone. They don't tend to utter commandments, but their words are spoken with an intention that they are not ignored. They don't command the economy as such, but they hold it within their hands to be able to do so.

This command does, however, undergo phases when it is diluted. Mallorca has experienced such a phase in recent years. Just as the Mallorcan economy would really be better served by not having the 40%-plus direct GDP reliance it has on tourism, so these economic manufacturers don't wish to have a reliance that creeps over the 40% level.

Thomas Cook is one of these manufacturers: one of the most powerful. In 2017, its sales for Spain as a whole have been 42%. Mallorca, despite what was said by tour operators before and and at times during the last season about prices, has been at the heart of this 42%. Thomas Cook was one of those tour operators. It spoke darkly about the upping of prices, as though there were a veiled threat.

The ideal, where Thomas Cook is concerned, would be to have around 30% of its sales in the Spanish market; historically this has been the sort of ballpark. This means a better distribution and a better balance. It also means that it is not being held over a barrel in quite the same way, because that was what happened as a result of the major increase in demand for Mallorca and Spain, which was the consequence of instability elsewhere.

Representatives of Thomas Cook, Tui and other tour operators as well as leading hoteliers are frequently quoted in the local media. They hold a position almost on a a par with politicians. They are a reflection of the curious Balearic economy, one that they manufactured. They demand to be quoted, they demand to be listened to. And they are; in a way that they wouldn't be elsewhere. Mallorca is the perfect publicity patch for the tourism economy's manufacturers, and this publicity spreads beyond the island's waters.

When the tour operators were moaning about increased prices, what were they really after? Well, lower prices perhaps, but by drawing the attention they did to prices, there would have been an underlying hope that they could effect a shift in demand. More stable politics in other destinations are granting them this wish, but they were nonetheless seeking a return to the greater balance that previously existed. When sales were at a balanced 30%, the hoteliers were not holding them over a barrel.

But although they were wanting to reduce this dependence, at the same time they couldn't afford to distance themselves. Consequently, having complained about prices and having dropped the hints about reviving destinations (hints now turning into fact), they then started to praise. Mallorca's hoteliers, Spain's hoteliers have really made an effort. They have invested well and wisely. They can justify their prices.

For all the talk about rival destinations, tour operators know as well as anyone that they can't live without Mallorca and Spain. Those other destinations don't have the kind of capacity and infrastructure. There will also be ongoing holidaymaker wariness. Not about Bulgaria, Croatia or Greece, but about those countries where things could suddenly get nasty again. Three hundred or so slain in Egypt is a reminder.

In 2018, the expectation, the hope for Thomas Cook is that sales in Spain will move back towards that more acceptable 30%. The prices are, nevertheless, still going up, and don't holidaymakers just know it, as the tour operators reflect these in their own margin calculations. But in 2019, so it is said, this situation will change. The prices are not sustainable in the face of renewed competition.

We will see. And we will also hear. It is extraordinary but it is not so extraordinary that there can be the kind of almost weekly feed of what tour operators and major tourism sector players think. The monoculture of tourism in Mallorca allows these thoughts to flourish and to constantly reinforce the curiosity of the economy. But behind these thoughts, we should sometimes stop and ask ourselves exactly why they are being expressed.