Disney is hurting for cash

[firefly_ris]

You mean Disney has access to better data than random people on a message board?

Whaaaat. I don't believe that.

 

[xuxa777]

https://blogmickey.com/2020/07/the-...ney-world-vacation-and-the-slow-summer-ahead/
Lex Luthor (Bob Chapek) was wrong. The demand is not there. Its also not at regional parks either. A lot of parks across the US are going to be in some trouble by the end of this. Disney will be fine they will just cut a lot of attractions that were planned.

They said WDW was leaving money on the table staying closed

They said the economy would come roaring back if we just opened again.

Apparently most would rather go to beaches or national parks are they are either free or cheap.

If people are going to national parks and beaches more so because it is a normal vacation like before (no mask etc.), not because they are free.

 

[OSUZorba]

If people are going to national parks and beaches more so because it is a normal vacation like before (no mask etc.), not because they are free.

Its really people aren't not going to beaches and national parks as much as they are not going elsewhere. National parks and beaches are pretty easy to socially distance and the majority of people going to them drive. But the experience at many of the major parks and beach areas is anything but normal (masks on everywhere indoors, etc). I have a feel most national parks and beaches have lower than normal visitation. Heck, I had a coworker book a last minute trip to Yellowstone a few weeks ago, you normally have to plan that a year out.

I cancelled my trip to Yosemite for next week and replaced it with Colorado so I didn't have to fly and so I could cook my own food instead of having to eat out (condo vs. hotel room). But Yosemite is reservation only and only taking half their normal daily average cars and a ton of facilities are closed, no bus service, etc.

 

[JM23457]

As posted from WDWpro at WDWMAGIC.


Let me preface this post by saying I know much more than I'm going to say in this thread. That's just the way it's going to have to be in order to protect sources, prevent doxing, and keep jobs safe. Additionally, it lets those sharing info with me know that if something needs to be off the record, it will stay if the record.

The Disney company is currently hurting for cash, and not by a little. The absolute destruction of the global film industry means that Disney is losing billions and billions of usual expected revenues with no certain end in sight. Mulan has been pushed to the end of August, but even that still seems optimistic, and likely box office revenues may by as low as 20% of what it could have been. A burgeoning cold war with China likewise makes promoting the film an uncertain formula. The MCU is currently benched, live action Star Wars is on pause, Indiana Jones 5 is more unlikely daily, and there's simply no good path forward outside of the animation studios. Furthering the dearth of income, Disneyland was prepped to reopen at great expense, only to be indefinitely postponed yet again. The money to reopen Walt Disney World has been immense, but with increasing COVID infections in Florida, it seems more and more likely that increasing capacity will be a slow process, which means revenues for WDW will be lower than projected when the rush was approved to get the parks open fast. Adding to this, capex projects needing completing at WDW are substantial, more than ever in the past decade. Conflict has broken out inside Disney's top levels with some pushing for continued spending in new projects, such as Splash Mountain reskinning, while others are extremely bearish with a view that Disney should hold every possible dollar.

It is from within this paradigm that Disney is now struggling with public messaging not matching internal capabilities. For example, Splash Mountain changes were announced with little design ready to implement, based off of a blue sky design that had a concept art package quickly produced for social media advertising. Just one problem: the actuaries were not approached, nor were budgets forecast for the changes. In fact, you might say a rogue committee approved the decision without determining the cost or the feasibility... and then the company realizes the issue after public announcement. So what to do? As of now, the plan is to "quickly" change the DLR version, where it is more likely to be received positively, then use Epcot capex funds that would have gone to Mary Poppins and JII to change the superior WDW version starting in 2022 or 2023. However, hopes that Disney can plus the attraction are difficult to materialize with Imagineering already completely flummoxed how they can possibly reskin many dozens of animatronics in a crown jewel attraction. One imagineer has compared the task to retheming Pirates of the Caribbean to a Jungle Book ride. Yet more attractions are likely to be modified, budgets be damned. This has created friction even all the way to the Bobs with Iger doing everything he can to save his legacy, while Chapek tries not to be the fall guy while looking at a company in dire financial straits. Whereas Chapek wanted to spend the capital necessary to retrofit MK for a pandemic and then slowly open other parks as demand and money permitted, Iger overruled the plan and pushed for a full reopening to prevent Universal from getting the upper hand.

Now the company has greater inner turmoil than at any point in the recent past. Spending is continuing in spite of depression-like revenues projected for the remainder of the year... and often on new projects of a social nature (changes are coming to Hall of Presidents, Jungle Cruise, Country Bears, Pirates of the Carribean, Carousel of Progress, etc). This is coming from one or two factions in the company who share overlap. Other factions are scared the company is stretched thin and needs to hold spending as much as possible. Fear also exists that if relations with China deteriorate, the company could lose both Shanghai and Hong Kong. Not since WWII has uncertainty been so high. The cost of maintaining parks during a pandemic are significantly higher, yet raising ticket prices is nearly impossible.

Going forward, what does this mean?

1. Epcot changes are likely to be MUCH less than originally planned.
2. Layoffs are coming.
3. Announced additions are on very long timelines.
4. Disney World having to close again would be devastating.
5. OLC and Disney relations are strained; expect that to manifest in visible ways.
6. Every penny counts, and cost cutting measures can be expected within 12 months.
7?. Is Chapek the fall guy? Many are speculating Iger plans to use him as the scapegoat.
8. 50th celebration is essentially canceled down to only things that cost little... no new floats, no big refurbs.

They're insane to try to change popular rides like Splash Mountain right now for political correctness's sake, when they're in the midst of going broke. I hope the financially prudent faction at Disney corporate leadership prevails.

 

[DCLMP]

It looks amazing with those crowd levels.

 

[JM23457]

I have a feel most national parks and beaches have lower than normal visitation.

I've read that bookings for national parks are way up, actually.

 

[OSUZorba]

I've read that bookings for national parks are way up, actually.

We'll see, many of the big parks are limiting guests, and all have limited services including reduced campgrounds and lodging. Yellowstone had half the visits in June 2020 as it did in 2019; no July numbers posted yet.

I'm sure the smaller parks in the NE and other parks that serve a more local crowd are seeing an increase in visitation, but 3 of the top 5 visited parks are limiting access significantly. Not to mention basically zero tourism to the Alaska and Hawaii parks.

The state parks here saw a huge increase in day usage, but from what I've seen a drop in overnight usage.

 

[jkh36619]

We'll see, many of the big parks are limiting guests, and all have limited services including reduced campgrounds and lodging. Yellowstone had half the visits in June 2020 as it did in 2019; no July numbers posted yet.

I'm sure the smaller parks in the NE and other parks that serve a more local crowd are seeing an increase in visitation, but 3 of the top 5 visited parks are limiting access significantly. Not to mention basically zero tourism to the Alaska and Hawaii parks.

The state parks here saw a huge increase in day usage, but from what I've seen a drop in overnight usage.

Thats us. We have done a lot of camping this summer and will probably do the same thru 2021. And we live on the gulf coast so lots of beach days as well.

 

[YesterDark]

It looks amazing with those crowd levels.

I think it looks sad.

 

[Disney Bobby]

Disney is about the experience. Most will pay small fortune for this premium experience, and spend a lot of time to make it as perfect as possible. I suspect the rules and limitations are making people want to delay until you can have the full experience again. I'm definitely doing that. We went 8 times last year. Already cancelled the rest for this year. Probably won't be back until this is over. I hate it, because our family has such a great time being together without the worries of the outside world, but we don't feel it will be the same.

 

[Farro]

I think people are cancelling right now because of the reduced experience and they think it will be better next year or at some point.

If no vaccine by end of year, I think people will start to see that this is indeed how it is for now and need to decide - do we want to not visit Disney for a possibly very long time, or do we want to go and adapt to the way things have to be for now? Even if a vaccine, I don't think masks requirements will go away over night. And masks/restrictions will still be most anywhere people visit, not just Disney.
I think when people finally accept (most people anyways) that this is how life is for now, bookings will go up again by later in the year, definitely next year. It's amazing what people can adapt to.

Honestly, the mask deterrent will lessen as people get more and more used to wearing masks and seeing others wear masks. I don't even really notice it anymore.

 

[BorderTenny]

Not surprised based on how many die hard fans on here have postponed their trips, let alone the casual vacationer who probably doesn't want to take the risk. Just curious for the locals, what would/could Disney do to attract you to visit more often and spend more money there?

For me, the number one thing they need to do to get me to spend money is start selling AP's again. I'm a new-ish local who even pre-Covid had been waiting for some financial pieces to fall in place before buying passes for any of the parks. Once the final piece settles, we'll be ready to spend, and we'll be fine taking our money to the "dark side" of Universal and SW/BG if Disney doesn't want to sell us AP's (preferably with bonus perks such as extra months, greater food/merch discounts, even free waterparks once they open).

 

[AmberMV]

For me, the number one thing they need to do to get me to spend money is start selling AP's again. I'm a new-ish local who even pre-Covid had been waiting for some financial pieces to fall in place before buying passes for any of the parks. Once the final piece settles, we'll be ready to spend, and we'll be fine taking our money to the "dark side" of Universal and SW/BG if Disney doesn't want to sell us AP's (preferably with bonus perks such as extra months, greater food/merch discounts, even free waterparks once they open).

Disney isn't going to do this, especially when all the current APs didn't get any special (or even fair) treatment. Plus the lack of park availability for APs now being as horrendous as it is, not sure why they would sell new APs when current ones can't get in. If you're looking for perks you'll need to look outside of Disney. UO offering 3 months free on APs, and SW/BG offering great deals on tickets and APs to entice potential Disney visitors who can't get what they want from Disney. I bought a SW/BG AP for 40% off recently.

 

[Moliphino]

The only thing deterring me from Disney is Florida's numbers right now (and the resulting quarantine requirements coming home). I can deal with the reduced experience and masks for a bit of an escape and the low crowds look fantastic to me, but I don't want to get sick or have to quarantine for two weeks (not sure how that would go over with work).

 

[jkh36619]

For me personally, it's a mask thing. I wear a mask in public but I just cant wear one all day long. We are heading down to the keys tomorrow getting ready for the lobster mini season next week, but I told my wife I wont be going to Key West this trip because of the mask mandate. You even have to wear one if you are on a golf cart. That's just not for me. We we hang out on the boat away from everyone this trip.

 

[Searc]

They're insane to try to change popular rides like Splash Mountain right now for political correctness's sake, when they're in the midst of going broke. I hope the financially prudent faction at Disney corporate leadership prevails.

It will be years (literally) before Splash is changed, if ever.

 

[TommyJK]

Don't forget the sizable amount of visitors from abroad. Upwards of 25% of their attendance is from tourists from outside of the US.

None of those people can even come right now even if they wanted to.

 

[Farro]

Don't forget the sizable amount of visitors from abroad. Upwards of 25% of their attendance is from tourists from outside of the US.

None of those people can even come right now even if they wanted to.

Right. And a lot of us can't go anywhere but within the continental US.

So if Florida's numbers go down and Disney can somehow market themselves to be the "safest, most magical place in the US!" - they may be able to make up a portion of the international travelers with domestic ones.

 

[TiggerBouncy]

It will be years (literally) before Splash is changed, if ever.

TBH announcing that was just stupid. I know they were trying to get on the bandwagon and play around in the "us too!" movement, but they should never have announced this AT THIS TIME. Because they will most likely under-deliver on it - even if it is just a re-skin - and Disney will look stupid for promising anything.

 

[TiggerBouncy]

Disney isn't going to do this, especially when all the current APs didn't get any special (or even fair) treatment. Plus the lack of park availability for APs now being as horrendous as it is, not sure why they would sell new APs when current ones can't get in. If you're looking for perks you'll need to look outside of Disney. UO offering 3 months free on APs, and SW/BG offering great deals on tickets and APs to entice potential Disney visitors who can't get what they want from Disney. I bought a SW/BG AP for 40% off recently.

There is absolutely no incentive for Disney to offer more perks for AP's. If they can support the AP crowd (meaning they are not worried about park capacity) and they start selling AP's again, they won't need to attract buyers. Economics 101 - you never offer a discount if people are willing to pay full price, and they wont have a problem attracting buyers once they can safely support the crowd.