Daniel Chávez is interviewed by 500 Expansión Online magazine.
Meet Daniel Chávez - Interview with Eladio González
July 15, 2019
This interview by Eladio González provides wonderful insight to the man who created the Grupo Vidanta organization. Very interesting!Sr. Chávez has contributed significantly to the state of tourism in Mexico and is participating in a very select group of businessmen to advise the President of Mexico on business matters that will improve Mexico's standing in the world. His foresight and vision is long term. Hopefully we will see a lot of it materialize over the coming years.
Expansión500 | Vidanta sails in the stern
Daniel Chávez - An atypical hotelier. Daniel Chávez is a civil engineer and has spent 45 years investing in tourism, where he has been a pioneer throughout his career.
At the moment, Daniel Chávez is thinking about what he will do in five years. Since Ivan, the fourth of his nine children, took the reins of the operation of the company, one of the largest tourist conglomerates in the country, the founder of Grupo Vidanta is dedicated to bring to the board table all kinds of "different" projects "
Although he claims to be a conservative entrepreneur, his investments are always bulky and, rarely, conventional. He was a pioneer in introducing the concept of vacation club in the country. He brought the most famous circus in the world to the Riviera Maya, with a permanent show, Joyà, from Cirque du Soleil.
This year, the group inaugurated a covered water park, the Jungala Luxury Waterpark, and launches with a luxury cruise line, Vidanta Cruises, the only one with a Mexican flag, whose first ship will sail along these coasts since October.
His most ambitious idea is called The Parks. The company announced an investment of $1,300 MDD a few years ago, however, that figure was exceeded when the project reached three times the size of Magic Kingdom, Orlando.
Daniel Chávez always speaks of Mexico as a country of immense opportunities. He himself is an example of this: he can go from telling you his humble origins in Delicias, Chihuahua, to how he advises President López Obrador, as a member of the business council that other important Mexican businessmen are also part of.
Expansion: Hotel occupancy in Mexico has decreased since the beginning of 2019, according to CNET data, which is attributed to the lack of tourism promotion. Many entrepreneurs in the sector felt worried. How do you perceive this panorama?
Daniel Chávez: I'm not worried. What is happening today is unprecedented. For decades, aspirins were being applied to the patient to keep him or her upright. There was excessive spending and, therefore, we lived an unreal situation. We are lucky that we are now realistic and we are considering solving the causes first, instead of mitigating the effects. As the president said: it does not make sense to work in international promotion, which is very expensive, when we have to solve so many internal issues. Undoubtedly, in the last governments there were advances, improvements in the country, more technology, more development, but all this only reached a part of the population.We had the resources, during the last 40 years, for that to have begun to be resolved, but it was not done. I am very happy, because, at last, they are analyzing and attacking the causes.
E: Do not you think that these problems take much longer to be solved than it will take for tourism to fall due to lack of promotion?
DC: The investment that had been made was important, however, we can not assure you that the decrease in the first quarter is due to a lack of promotion. There was promotion throughout 2018 and there will be during the first half of 2019, because that's how it works. What we are seeing today is the result of a devaluation three and a half years ago, and a very important exchange rate adjustment, which put Mexico in a preponderant position.
We also had the effect of sargassum in the Caribbean. What we need is to change the mentality of the turisteros. We can not compete with anything other than sun and sand, or creating magical towns, without an urban development program that protects them. There must be a Federal Urban Development Law for tourist destinations, and if you want to benefit from promotion, you must comply with it.
E: Your recipes for success are somewhat different from those of most entrepreneurs in the sector.Is that an advantage in times of uncertainty in the market?
DC: The difference is an added value. What does not work is routine, monotony. What sells is diversity. We have to be diverse, that is a natural law, even in the animal world. To be different you have to know how far you can go, you should not go to the extreme of confusing people. Everything must have an economic, market sense.
We always play within that range, we go to the point where we know that the market will understand us, although we often have to prepare it. Magic Kingdom took 10 years to develop, that was the time it took the market to understand the reasons to go to an unknown place, like Orlando, with mosquitoes and extreme temperatures. In our case, we are talking about half of that time. Although, today, communication conditions are different, that change does not occur overnight.
E: Grupo Vidanta sales increased to 16,650 mp in 2018, 13.6% more than the previous year. To what do you attribute these results?
DC: I attribute it to lack of working more, something we did not do correctly. With the right creativity, in a country like Mexico, growing less than 15% should not be considered positive, specifically, in this sector. Not in these conditions, not for a company that already entered a different time. Today, with all the added value we have, without a doubt, we should be growing more, because there is a lot of effort behind, and we have all the elements to do it internally.
E: The Parks project has that label it mentions. What is the formula to achieve the expected results?
DC: The Parks project is of enormous magnitude. In total, there are four parks, occupying an area three times larger than Magic Kingdom. Something we have learned is that a park alone does not generate the synergy that several parks can have together to develop the entire market. We have hired the best park developers in the world, from China, from Serbia, from the United States.
The parks are not developed for a hotel, they are made for the destination, as we did with Joyà together with the Cirque du Soleil, to enrich the Riviera Maya. During the first three years of opening of the four parks we calculated to attract between four and five million visitors to the destination.
Vidanta Cruises With Mexican flag. Grupo Vidanta has invested 140 million dollars in the first luxury cruise that will sail along the coasts of Mexico.
E: But your biggest bet this year is at sea, with the opening in October of the group's cruise line. How did you decide to enter this industry?
DC: This was born from a meeting with the governor of Sonora, Claudia Pavlovich, and a group of Sonorans who wanted to do something in San Carlos. We proposed to buy a ship to connect this one with Puerto Peñasco, as long as they took care of the development of San Carlos. At that time, we imagined a boat totally different from the current one, but that's where the initial idea came from. Then, there was never a response from San Carlos investors, nor any approach to carry out the project. Seeing that, we decided that we were going to do it, but in a different way. Three years ago, we made the decision in the company's board to carry it forward.
E: What ended up transforming, finally, the cruise project?
DC: In the cruise industry you have megacrossers, which are floating cities, or absolutely exclusive cruises, which are very elegant. We decided on the second. We found a boat with 300 cabins, for 600 passengers and 500 crew. A new boat would have taken seven years, so we found this one, we are leaving it as new. The first boat will undoubtedly sail through Mexican waters, but we will clearly open routes. We are interested in many routes, and we are in the process of defining them. But, for now, we will remain in Mexico, at least during the first year.
We have a plan that includes five boats, but we are a very conservative group. The agreement was to operate the first vessel for six months and if the results are as expected, we have six months to acquire the second vessel. To reach five ships, 10 years may pass.