How will DVC handle a recession/poor economy?

[DanenRox]

We're officially in a recession in RI and I believe Florida is as well. Real Estate prices are falling fast and there's an abundance of houses for sale. Popular thinking indicates more people will vacation "closer to home" than take extravagant vacations. In this economy, extra dollars are harder to come by. How do you suppose DVC will respond in terms of marketing their vacation properties? Will there be better incentives...a drop in per point cost? I can't imagine Disney will be unaffected by the economy. What do you think?

 

[crisi]

There will be a hold on the development of new units and a slow down on the finishing of units in progress. There may be better incentives, but not significantly better. That has been what they have done with each slowdown of the economy. They may or may not be able to hold prices depending on what inflation does. If inflation goes up for you, it goes up for Disney and they need to keep pace with their costs.

 

[PIERCEDRN]

I bet they will release a big huge Monorail Resort as a DVC and name it after a sandwich. Then they can print all the disney dollars they want.
BOB

 

[StotheK]

I think the 100 point buy-in at AKV for new purchases is one of the things they're trying to do to combat the slowing economy. I wouldn't be surprised to see them market more heavily to Canadian and other international guests. The dollar is pretty weak right now which makes big ticket items priced in US Dollars pretty attractive to people outside the US.

One other thing I thought about the other day actually. Disney can count on DVC members even in harder economic times. We bought in and have essentially pre-paid for our trips. Therefore, we're pretty motivated to visit even when the economy is down. Cash guests aren't so tied down and can simply chose to put their money in the piggy bank.

 

[Chic]

I know one thing DVC has done is lower the minimum buy in points to 100 for Animal Kingdom Villas. I hope they decide to lower the cost of points at Bay Lake Tower and the Grand Californian Villas because I want to buy points there. Maybe fewer people will travel so that will mean easier availability for us and lighter crowds in the parks. Somehow, I doubt this will happen because of so many waitlists already posted for October and December this year.

 

[deerh]

There may be a slowdown of the economy, but you watch! There will be no slowdown of Disney... The crowds will STILL be there, even more, and I will say-the economy is in a slowdown huh? NO such thing at WDW..

People will STILL go on vacation... I have been to WDW for the past 8 years, and have YET to see a slowdown yet...

OF COURSE, people are quick to blame the president, congress, etc... but that is another topic........



deerh

 

[CarolA]

I bet they will release a big huge Monorail Resort as a DVC and name it after a sandwich. Then they can print all the disney dollars they want.
BOB

Sounds like it based on these boards!

 

[Chuck S]

There may be a slowdown of the economy, but you watch! There will be no slowdown of Disney... The crowds will STILL be there, even more, and I will say-the economy is in a slowdown huh? NO such thing at WDW..

People will STILL go on vacation... I have been to WDW for the past 8 years, and have YET to see a slowdown yet...

OF COURSE, people are quick to blame the president, congress, etc... but that is another topic........



deerh

I don't know, the parks were pretty slow for a year or more after 9-11. Parks cut hours, POP century resort was put on hold, and only ultimately only half finished. Granted, the downturn at that time was due more to people being afraid to fly, but economic downturns can and will effect WDW, and the overall leisure travel industry.

 

[Jaaron2]

If you build it (BLT)........
They will come

 

[Disney_Villain]

All financial indicators show that Disney is holding up very well, and for many reasons can weather the US recession well . . .

"In the past five years, Disney shares are up 77 percent compared to the S&P 500's rise of 51 percent. So far this year, Disney shares are up nearly 3 percent, outperforming both the S&P 500 (which has fallen 4 percent) and the rest of its media conglomerate peers." - CNNMoney

If you wish to read up more on the (above) recent CNNMoney article that was posted on DVCNews.com:

http://money.cnn.com/2008/05/05/news/companies/simons_disney.fortune/?postversion=2008050517

 

[hakepb]

Plus with the weak dollar, WDW is now cheaper for international travelers. Someone on this board mentioned that due to the weak dollar, the total cost (airfare, hotel, tickets..) of a WDW (Florida) trip was actually cheaper for them than a Disneyland, Paris trip.

 

[Disney_Villain]

That's what is made us buy into DVC in 2006, again in 2006, and again in 2008 - as well as some of our friends here in Canada have been scrambling to buy into DVC with the current USD/CAN exchange rate. We are all also staying for longer than we used to, which helps the parks as we continue to spend while we are there.

Hey, as long as our money goes to Disney I'm happy - its for a good cause!!

Plus with the weak dollar, WDW is now cheaper for international travelers. Someone on this board mentioned that due to the weak dollar, the total cost (airfare, hotel, tickets..) of a WDW (Florida) trip was actually cheaper for them than a Disneyland, Paris trip.

 

[suzycute]

Us too! We're from the UK and with the dollar at almost two to the pound, buying into DVC was a great deal for us.

 

[tiggerrr]

That's what is made us buy into DVC in 2006, again in 2006, and again in 2008 - as well as some of our friends here in Canada have been scrambling to buy into DVC with the current USD/CAN exchange rate. We are all also staying for longer than we used to, which helps the parks as we continue to spend while we are there.

Hey, as long as our money goes to Disney I'm happy - its for a good cause!!

We bought in last year and added on this year because of the good exchange rate. In our mind, the more of our vacation dollars we can "lock in" by buying DVC, the better we would be both now and if the exchange rate ever worsened.

The last trip to WDW before the trip in which we bought DVC was in 2000 and I paid an extra 60c on the dollar for that trip. Getting a DVC purchase on par couldn't be passed up. In CDN dollars, we're still paying the same for park tickets and food as we did on that trip 8 years ago. We're going to WDW 4 times in 18 months, after a 7 year absence. I don't know that there will be enough foreign travellers to make up for a US recession, but I don't think it will be that bad on Disney.

Personally, I think the escalating cost of fuel (Air or Vehicle) will have a bigger impact on travel than the recession.

 

[BWV Dreamin]

Today the Dow tanked, down just shy of 400 pts., loser's all accross the board. Airline industry has stated that major changes within the airlines are happening or will happen, and they will be permanent changes. While Disney may have hedged against some recessionary measures, it will not be able to change the fact that the price of oil is conintuing to rise, and may approach $150/barrel. This will impact the parks and resorts. Nothing Disney can do to influence that market.

 

[bobbiwoz]

There's a thread on the Theme Parks board that says Osborne Lights won't be lit until the day after Thanksgiving. Different reasons have been put forth including the cost of the lights. Right now the official date isn't given, it's on some other info site.

I don't see how Disney could not be affected by the economy. I also think that the 100 point buy-ins is one way they are dealing with it.

Bobbi

PS. Wasn't yesterday a good day in the market? Good days come and go!

 

[BWV Dreamin]

There's a thread on the Theme Parks board that says Osborne Lights won't be lit until the day after Thanksgiving. Different reasons have been put forth including the cost of the lights. Right now the official date isn't given, it's on some other info site.

I don't see how Disney could not be affected by the economy. I also think that the 100 point buy-ins is one way they are dealing with it.

Bobbi

PS. Wasn't yesterday a good day in the market? Good days come and go!

Wow, I'm impressed there Ms. Bobbi! Someone else who follows the financial markets! And you are straight on.........the start is with the 100 pt. buy-ins. We will see future incentives....

 

[deedeetoo]

I think this will also affect add-ons. We first bought in two years ago. We have been thinking about buying more ever since. Now suddenly dh is saying "Wow, I'm glad we didn't buy more so we don't have to worry about flying to Florida more often"

 

[bobbiwoz]

Wow, I'm impressed there Ms. Bobbi! Someone else who follows the financial markets! And you are straight on.........the start is with the 100 pt. buy-ins. We will see future incentives....

You always make me smile! I have 2 DS's who watch Cramer and talk about him and the market whenever they think I will listen! I learned fractions/decimals at my DGF's (really DDzadzie's) knee, going through financial pages.

Bobbi

 

[Woodcourt]

I bet they will release a big huge Monorail Resort as a DVC and name it after a sandwich. Then they can print all the disney dollars they want.
BOB