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Spain ‘to suffer 500 hotel closures’ due to Thomas Cook failure

As many as 1.3 million holidaymakers will be unable to fly into Spanish destinations this autumn and winter due to the Thomas Cook collapse, writes spanish travel media today.

This will result in at least 500 hotels being shut down, generating losses to the tourism sector running into hundreds of millions of euros, according to the Spanish Confederation of Hotels and Tourist Accommodation.

The Spanish government previously announced a package of measures worth €300 million, including emergency credit lines and a reduction in airport fees, particularly for hubs in the Balearic and Canary islands, plus plans to spend €500 million in improving tourism infrastructure.

It calculates that the favoured winter sun destination of the Canary Islands alone will lose 400,000 visitors.

The Fuerteventura Princess, which had an exclusive deal with Thomas Cook covering 95% of its 688 rooms up to 2023, is reportedly going to lay off its 160 staff, a fate to be shared by at least 3,400 others in the sector, according to estimates.

Ramón Estalella, head of Spain’s leading hotelier association, told the BBC: “They need to do something to get airlines to pick up the slack and take more slots by slashing costs. We need to take a bigger risk.

“Meanwhile, it’s unfair that hotels are having to pay VAT on bills charged to Thomas Cook and its subsidiaries which they know they’ll never be paid.”

More than 700 staff at Thomas Cook’s largest subsidiary in Spain say they are the biggest victims of the travel giant’s crash, having not been paid since the summer and now finding themselves in a legal limbo.

The Palma-based In Destination Incoming agency went into liquidation days after Thomas Cook ceased operations, reportedly announcing debts of a €57 million.

“We have no guests in any resorts, but due to Spanish law we have to present ourselves at work every day to complete our 40 hours,” one worker told the BBC on the condition of anonymity due to what she described as “ongoing legal proceedings”.

“If we do not go, they will take it as our resignation instead of an official dismissal or redundancy, and we won’t be able to claim anything at all,” she added.

Pep Ginard, of the CCOO services sector union in the Balearics, confirmed that staff at In Destination Incoming faced a “long and difficult process” to claim back pay and redundancy which, under Spanish labour laws, should be worth at least 20 days’ wages per year of service.

Rafael Gallego, president of Spain’s CEAV travel agency association, said the Thomas Cook debacle should jog policymakers into realising that increasingly few travellers merely sign up to a package based on a destination’s climate or vibes.

“People travelling today don’t go so much to a place, but rather to do something specific,” he told the newspaper El Mundo.

Nowadays, tourists were looking for a product, either active holidays such as playing golf, paragliding and diving, or more leisure-based breaks involving nature, gastronomy and cultural tourism, he argued..