German tour operators are currently forecasting a ten per cent decrease in German tourism this summer. The reasons are well-known: competitor destinations, increased hotel prices in the Balearics and the tourist tax. Bookings are at present said to be down by 17%. They are expected to pick up, but this might not be until the spring.
At the recent Fitur tourism fair in Madrid, tour operator representatives held talks with hoteliers that were aimed at cutting their contractual commitments to beds for this summer. Meanwhile, however, German airlines are maintaining the flight slots for the three Balearic airports. This may have to be reviewed if holiday bookings do not show indications of some rebound.
As well as the German market, there are issues with UK and Scandinavian bookings, which are being affected by Brexit and economic conditions.
Hoteliers on the islands, facing this fall in activity, will need to revise downward their profit forecasts for this year. Following several years of economic when profit either stayed much the same or fell, the hoteliers were able to return to situations of healthy profitability because of the diversion of holidaymakers from Mediterranean trouble spots and higher prices.
The hotelier associations in the Balearics have called for the tourist tax to be suspended, arguing that tourists are being penalised in the Balearics while also being incentivised to holiday elsewhere.