We’ve gotten a few calls from reporters following up on financial trouble rumors and have seen some signs of stress in the travel tour industry. In general the companies serving Latin America seem to be faring better than most overall. Latin America’s domestic economies are not reeling so badly, cheaper airfares are enticing new travelers from North America, and the value proposition is sinking in with those who are trimming but not cutting.
Dynamic Leisure in Tampa went under earlier this year and there have been others, but most of the agency turmoil thus far has been one level removed from the public eye. Joystar has been in bankruptcy court this week, though you wouldn’t know it from their website. Travel Weekly reports they have “$2.6 million in liabilities but only $18,000 in assets.” Plus “Joystar and its parent, Travelstar, estimated an average future gross income of about $16,500 per month and future expenses of $1.6 million per month.” How ’bout those numbers?!
The company basically performed back office and logistics operations for agencies, in their words “selling complex travel products including cruises, vacation packages and group travel through our virtual salesforce of independent travel agents.” They are still soliciting new business it looks like.
The lesson in all this is to deal with reputable tour companies who have a good long-term track record and to ask lots of probing questions about not just their financial stability, but the stability of the real company actually running the trip. And if you’re spending 5 0r 10 grand apiece on a tour, pay with a credit card and buy some independent insurance to protect that investment.