The French brand’s only Australian resort is slated to close in January, citing poor sales numbers, changing customer desires, and the broader economic issues affecting Whitsunday tourism.
In a move that has shocked the Queensland tourism industry, Club Med has announced that it will be shutting the doors of its long-standing resort on Lindeman Isand after January of 2012. The resort, which ran for two decades after being purchased by Club Med in 1990 for a reported AUD $15 million, was the only tourism enterprise on the island, which is composed primarily of untouched National Park lands. The resort’s closure will result in job losses for at least 25 staff, although the company has stated it will assist employees in finding work on neighbouring island resorts.
Daniel Gschwind is the chief executive of the Queensland Tourism Council, and he expressed his disappointment at the closure in an interview in Smart Company magazine, suggesting that it was a general problem afflicting the tourism-dependent Great Barrier Reef area. “Some regions are being more affected than others, and for a number of reasons, the Whitsundays are being hit right now.”
John Lee, chief executive of the Tourism and Transport Forum, was quoted as saying that the closure should serve as a “wake-up call” and that more government assistance should be given to the struggling industry. “This should serve as a wake-up call for the industry,” he said. “We could get more assistance and investment coming in if there was some action on this.”
According to Club Med executives, however, the problem was not merely declining numbers, but that Lindemen Island was aiming for a difficult demographic. Faced with heavy competition from cheap destinations like Thailand and Bali, and a continuing economic slump for the average worker, Club Med’s middle class vacationers were travelling less – and travelling less expensively.
On the other hand, requests for more upscale holidays were on the rise. The general manager of Club Med, Quentin Briard, issued a statement that guests were seeking a more premium experience than Lindeman offered, and that the lower-end “3 Trident” resort was unable to meet their customer’s expectations. The resort is expected to be listed for sale with Coldwell Banker Real Estate at some point next year.
With a sizeable capital investment from the new owners, Lindeman could potentially be redeveloped into an upscale destination rivalling any of the Barrier Reef’s luxurious resorts. Queensland Tourism’s Gschwind warns, however, that this may not be easy at the moment. “We think it’s an attractive destination, a unique product, and being a network of national parks has a pretty good attraction there. It’s a strong product, but commercially, it’s just very tough right now.”
Read more about the closure of Lindeman Island Resort: Smart Company