International Business : Seeing Red : Mexico’s Crisis Tests Promoters of Bullfights and Other Sports

Aficionados say it’s been a good year for bullfights at Plaza Mexico, the world’s largest ring, where top matadors and lusty fans congregate on Sunday afternoons from November through February for drama, spectacle and blood sport.

But not even Mexico City’s fabled corridas are immune to the vicissitudes of the country’s ongoing economic crisis. Despite this being the ring’s 50th anniversary season and performances by the world’s top bullfighters, “business is bad,” promoter Rafael Herrerias said last week.

The peso devaluation over the last year has in effect doubled the cost of dollar-based fees paid to star bullfighters, and attendance is basically flat.

“They say we’re in a recovery, but I don’t feel it in the business yet. People don’t have money” for shows, Herrerias said.

The troubles affecting Herrerias are shared by promoters of other Mexican sporting events, concerts and shows. They are paying higher-valued dollars for imported talent and trying to attract fans whose spending power has been cut by a third by inflation and the weaker peso. Meanwhile, bullfight promoters--unlike sports franchise owners in the United States--cannot garner revenue from stadium boxes, concessions and broadcast rights.

OCESA, Mexico City’s largest concert promoter, said gross ticket sales dropped 22% in 1995, despite a year that began with four sold-out shows by the Rolling Stones in January and ended with 14 capacity dates by heartthrob singer Luis Miguel in December.

“Normally people try to go out and forget about things during bad times, but evidently that’s not happening in this recession,” said Marcela Gomez, an OCESA spokeswoman.

Because it sees little prospect for improvement, the promoter is cutting back in its promotions, particularly of foreign acts that in 1994 were 75% of OCESA’s business.

“We think that next year is going to be a very tough year, no matter what the government says,” Gomez said.

More evidence that fans are staying home comes from the Mexico City treasurer’s office, which collects taxes of between 6% and 10% of gross receipts at movie houses, amusement parks, bullfights, soccer games and other spectator events. Those revenues were down 13% during the first 11 months of 1995, compared with 1994.

“There was a diminution because of the recession and because the promoters can’t afford to bring in the international stars who are the biggest attractions,” said Mario Enrique Hernandez, assistant to Mexico City Treasurer Pedro Vasquez Colminares.

For bullfights promoted by Herrerias--Mexico’s top promoter of the sport--attendance is averaging about 30,000, only slightly better than last year, and two-thirds of the stadium’s 44,000-seat capacity, making the Temporada de Oro (Golden Season) a big disappointment.

Herrerias said he has raised ticket prices at the bullring an average of 18%, the maximum allowed by the government since the devaluation sent Mexico reeling into recession. Still, that isn’t enough to recoup fees paid to top bullfighters, particularly foreign toreros such as Cesar Rincon of Colombia and Enrique Ponce of Spain, who now command up to $50,000 per bullfight. That’s significant because those fees amount to half of Herrerias’ overhead.

Herrerias, 44, a former veterinarian who took over bullfight promotion three years ago to follow his passion for the sport, says other costs are up. The breeders of the fierce, half-ton bulls have raised their prices 20% this year, Herrerias said. Six bulls now cost him about $20,000.

But his largest overhead item is bullfighter fees and 70% of the ones he hires are foreigners who demand payment in dollars. He has no choice but to come up with the money, because other promoters in Peru, Colombia and Venezuela are bidding for bullfighters’ services during winter months, when the sport’s focus shifts from Spain to Latin America.

Herrerias must also compete for bullfighters with the 100 other bullrings, large and small, in Mexico, where bullfighting is a national passion and second only to soccer in terms of spectator popularity. The sport draws a broad cross section of fans, including, as Herrerias put it, “preachers, artists, professionals . . . the entire country comes.”

In addition to Mexico City, the major bullrings are in Guadalajara, Monterrey, Queretaro and Tijuana, where the season runs in the summer and where fans include a high percentage of U.S. tourists.

Unlike professional sports team owners in the United States, Herrerias has no sweetheart deal with the Plaza Mexico stadium owner, the Cossio family. He says he gets no share of food, beverage or souvenir sales.

And Televisa, the state-owned broadcast monopoly and Herrerias’ partner in the bullfight promotions, gets to broadcast the bullfights for free. Herrerias makes money only from broadcast advertisers. Bullfighters, on the other hand, receive a royalty from Televisa for broadcast rights.

Still, Herrerias has not had to lay off any of his 100 direct employees, many of whom have other jobs and work at Plaza Mexico for tiny salaries, just for the opportunity to be close to the action.

“Of course I feel the crisis. You would have to be insensible not to,” said Rodolfo Meneses, leader of the mule team that drags off the bull carcasses, who is paid $16 a bullfight. “I’m here for the passion of the fight.”

But if Herrerias is holding his own, the little businesses and vendors around Plaza Mexico--restaurants, souvenir sellers and others who depend on the Sunday afternoon crowds for their livelihoods--said 1995 is a bust.

“It’s very bad, just enough to eat. There’s no profit. This is worse than novillada season, when the amateurs fight the young bulls. Sales are down more than 30%,” said Reynaldo Garcia, a vendor of hats and bullfight souvenirs.

Gerardo Gonzales, who sells beer in the uppermost, cheap-seat section of the stadium, said his sales are down 50% this year from 1994: “People don’t come like they used to, even though there have been good cards.”