Is Magical Express still free of charge?

[fanofdisney]

After the celebration ends?

 

[Bob P]

Yes, it will be until further notice. Which, of course, could come any time!

 

[seashoreCM]

The latest contract with the airport for supporting facilities (welcoming counter, bus berths, areas to sort baggage, etc.) is through 2011 but this does not imply that the service will be free until then.

One can reasonably expect that if a charge is imposed for ME, there will be at least six months' notice.

Disney hints:
http://members.aol.com/ajaynejr/magicx.htm

 

[Lewisc]

Disney announced in April that DME would continue to be complimentary.

http://www.wdwnews.com/ViewPressRelease.aspx?PressReleaseID=103337

I understand that the contract with MCO doesn't require that DME remain free and that Disney is free to change the policy but it's free until further notice.

That said charging for DME probably won't work. The rumor is Disney is paying Mears around $25 R/T per passenger. Disney would have to charge more than that to cover the luggage transfers. At that price some families would go back to using rental cars and towncar services.

DME works because of the volume of passengers allows Disney to dispatch the buses quickly and to only make a few stops. If the volume of passengers goes down the service will start to look like the old Mears service; longer waits with many stops.

I'd probably rent a car rather than pay for DME. When I rent a car I generally go to the Disney outlet store and will frequently spend a day at Universal. Without a rental car I don't bother.

For the most part taxis and towncar services can't compete with free.

 

[Horace Horsecollar]

A lot of people on this board think that DME can't remain free because it costs Disney so much to operate the service. Some of the people running Orlando area livery (towncar and limo) services are still making business decisions based on the assumption that Disney can't possibly keep "losing" so much money.

The press release link that Lewisc posted says, "Officials also announced that Disney's Magical Express, which offers airport shuttle and luggage delivery between Orlando International Airport and select Walt Disney World Resort hotels, will continue beyond 2006 and remain complimentary." I suppose this can be read as leaving the door open for Disney charging some time in the future — but I think it's highly unlikely.

Disney hasn't been providing Disney's Magical Express as a complimentary service since DME was launched just to be nice. Disney has done so because it's good business.

Let's assume that the $25 per person figure that Lewisc mentioned in this thread is correct. (It seems to be in the right ballpark.) For just $25 per guest, Disney achieves:

• Higher REVPAR (Revenue Per Available Room) at Disney resorts, due to higher occupancy levels and less discounting of rooms.
• Higher perceived value of on-site lodging, allowing room rates to increase over time.
• Higher perceived value of WDW vacations, leading to more guests each year.
• More on-site spending for attractions, restaurants, and shopping, because guests without rental cars are a captive audience.
• Less opportunity for guests in accommodations with kitchens to shop at off-site grocery stores, leading to more business at Disney restaurants.

In other words, Disney's Magical Express produces new revenue — possibly an average of hundreds of dollars per guest for Disney's $25 "investment" in each DME guest — even though there's not a direct charge for the service.

What makes Magical Express so brilliant is that it's optional. Disney doesn't put an "invisible fence" dog collar around guests' necks. Disney doesn't prevent guests from using rental cars, taxis, or towncar services if they prefer not to use Magical Express.

 

[Lewisc]

Sorry to disagree but I only think a handful of posters, mainly related to the towncar industry, question if Disney can keep DME free. Most of understand DME is a resort perk that probably makes sense for Disney. I understand Edd and a few owners of towncar companies question if Disney can keep DME free but not most of us. You just put up a "straw" man.

I don't think DME would work if Disney charged. A charge would reduce volume which would result in longer waits for a bus to fill and/or more stops at WDW.

The $25 figure doesn't include the cost of luggage delivery from MCO or the cost of the resort check in service. It's not clear how much Disney pays for RAC and how much is paid by the airlines.

I wouldn't consider staying offsite without a rental car. Prior to DME and the dining plan I would sometimes use use PL to book a resort. DME and MYW Dining motivates me to stay onsite--even if I book a moderate. DME gives Disney a big advantage over offsite properties. A family now has a financially tangible reason to pay a few extra dollars to stay on site.

All that doesn't change the fact that Disney wasn't playing completely fair. I saw a non-resort guest being sent to Mears to buy a voucher. That person would otherwise be a taxi customer. Disney is still not paying MCO enough to compensate for the lost revenue from the rental car agencies. The fault is MCO accepting Disney's numbers. The towncar industry should have gone after the luggage delivery part of DME. Disney has exclusive access to parts of MCO. My guess is the industry would have had a much better shot of making Disney transport their customers bags then they had of getting DME banned. Make Disney provide part of a free service.

The towncar companies can't compete with free. Guests who don't want to ride in crowded buses need to rent a car. The overcrowded buses with guests standing are the buses that take guests to the parks not the DME buses.

A lot of people on this board think that DME can't remain free because it costs Disney so much to operate the service. Some of the people running Orlando area livery (towncar and limo) services are still making business decisions based on the assumption that Disney can't possibly keep "losing" so much money.

The press release link that Lewisc posted says, "Officials also announced that Disney's Magical Express, which offers airport shuttle and luggage delivery between Orlando International Airport and select Walt Disney World Resort hotels, will continue beyond 2006 and remain complimentary." I suppose this can be read as leaving the door open for Disney charging some time in the future — but I think it's highly unlikely.

Disney hasn't been providing Disney's Magical Express as a complimentary service since DME was launched just to be nice. Disney has done so because it's good business.

Let's assume that the $25 per person figure that Lewisc mentioned in this thread is correct. (It seems to be in the right ballpark.) For just $25 per guest, Disney achieves:

• Higher REVPAR (Revenue Per Available Room) at Disney resorts, due to higher occupancy levels and less discounting of rooms.
• Higher perceived value of on-site lodging, allowing room rates to increase over time.
• Higher perceived value of WDW vacations, leading to more guests each year.
• More on-site spending for attractions, restaurants, and shopping, because guests without rental cars are a captive audience.
• Less opportunity for guests in accommodations with kitchens to shop at off-site grocery stores, leading to more business at Disney restaurants.

In other words, Disney's Magical Express produces new revenue — possibly an average of hundreds of dollars per guest for Disney's $25 "investment" in each DME guest — even though there's not a direct charge for the service.

What makes Magical Express so brilliant is that it's optional. Disney doesn't put an "invisible fence" dog collar around guests' necks. Disney doesn't prevent guests from using rental cars, taxis, or towncar services if they prefer not to use Magical Express.

 

[CarolA]

I spent some IN DEPTH time with the Disney Annual Report this year. My gut feeling is that the DME expenses are NOT a huge as we might imagine especially on a per guest basis. (Disney pays nothing for your luggage transport back to the airport on a participating airline and probably got a deal from that company for the transport TO Disney. For the return the airlines pay. )

The increased revenue per guest according to the people I talked with (and these were high finance folks at WDW) is greatly due to to DME and they see the trending of the use of DME going up as word of the service spreads and the service continues to operate in a mostly trouble free mode. The trending they have indicates that the extra money you spend at Disney exceeds thier cost to transport. (I was interviewing for a job, they did not share the exact details with me, but between what they told me and my analysis of their finanicals...I would tend to think that what I was told was the truth. Even if it does cost the $25 then if you don't go to Sea World one day Disney just MORE then broke even!)

 

[Lewisc]

Carol it's not just DME. MYW Dining and the almost free extra days of park passes with the MYW ticket pricing reduces the motivation of guests spending time and money offsite. Four theme parks, two water parks, DTD and other resort amentities give guests enough to do during the course of a one week vacation without having to leave WDW.

I don't know how many guests would otherwise rent a car but if enough people take DME as opposed to a rental car Disney might be able to put some of their resort parking lots into better use.

DME also helps Disney to capture some guests that might otherwise stay off site.

I spent some IN DEPTH time with the Disney Annual Report this year. My gut feeling is that the DME expenses are NOT a huge as we might imagine especially on a per guest basis. (Disney pays nothing for your luggage transport back to the airport on a participating airline and probably got a deal from that company for the transport TO Disney. For the return the airlines pay. )

The increased revenue per guest according to the people I talked with (and these were high finance folks at WDW) is greatly due to to DME and they see the trending of the use of DME going up as word of the service spreads and the service continues to operate in a mostly trouble free mode. The trending they have indicates that the extra money you spend at Disney exceeds thier cost to transport. (I was interviewing for a job, they did not share the exact details with me, but between what they told me and my analysis of their finanicals...I would tend to think that what I was told was the truth. Even if it does cost the $25 then if you don't go to Sea World one day Disney just MORE then broke even!)

 

[CarolA]

I agree Lewis, but you would be amazed at how much they track. They can tell you which guests used DME, they know the average spent per DME guest vs no DME guest. Avg spent per ticket day (MYW), avg spent per Dining plan vs. non-dining plan. And they aren't satisfied, they want more. Those fancy room keys give them more data then we can imagine espeically if your tickets are on them.

They really have a very good idea of their ROI on DME!

 

[safetymom]

LewisC, thanks for the link. Finally I got to see in print where they said it would remain free.

 

[Lewisc]

Carol--it's really the chicken vs the egg question. Do DME guests spend more time and $$$ at WDW because they used DME? or Do guests that plan to spend their vacation at WDW take DME? Do guests who plan on spending time offsite rent a car at MCO?

I'll agree DME has a positive effect on guest spending, I think the statistics have to be discounted due to guest selection.

DME and the Dining Plan motivates me to stay onsite. I'm not sure DME by itself would.

I wonder what impact DME and Dining is having with leisure bookings at Swan/Dolphin.

 

[CarolA]

Well, I am a stay on sight, but don't use either DME or Dining LOL!

I think for some of the "diehards" like me, the enhancements are nice, but not make or break. But I read enough on the resorts board to think that they do move the "borderline offsite" over to the Mouse's hotels!

 

[Edd]

LewisC,

I just want to compliment you on your remarks that you make on these boards. They seemed to be well thought out and prepared.

A lot of things have changed since the ruckus over the Magical Express started over a year ago. In the beginning a lot of things were done unfairly by Mears, Disney and the airport authorities. Just don't get me talking about it because I was right smack in the middle of everything. I was the lead in the fight to rein Disney in. We did pretty much and basically have come to agreements as to what to expect from Disney, Mears and the Airport. Everything has quieted down and the good transportation companies have continued to prosper in the transportation field.

To tell you the truth ME takes a large percent of the old Mears shuttle customers, a small percentage of the demand taxi rides and a very small percent of the luxury rides. No one felt that Disney should be involved in transportation. The ME has relieved the congestion and confusion that exists when it concerns transportation. The crowds are now being shipped out on the ME and the passengers looking for transportation are left with less to contend with.

The fight also put the airport on notice they must enforce rules they have established to make everything fair to everyone. At one point we had Disney greeters running around on the third floor soliciting every passenger who walked off the planes. Prepaid passengers of transportation companies were put on the ME and transportation companies found many requests for the passengers monies to be refunded. Every other transportation operator was not allowed on the third floor. It took three or four months to get that stopped and for the greeters to be moved off the third floor. They are gone now. They actually are on the second floor and only helping people who have reservations for the ME.

Disney tried to get the "meet and greet" areas on the second floor to be moved. They were defeated soundly on that idea.

The ME busses were using their spaces and the spaces allowed for transportation companies who did have pre-paid passengers and used those slots to pick up their passengers. ME does not use those spots now as they will be fined like any operator who uses the ME slots.

At present time the Transportation companies (smart ones) have found new cheese. I refer to a best seller I read last year entitled, "Who moved my Cheese." There is no big problem that exists between Disney and the local companies. Many luxury car riders may have tried the ME, but found it not to their liking. These people are returning to their old companies to again ride to Disney.

I am sure there are people who hope the ME will cease to be free. That is not out of the realm of reality. Remember Disney sacked their most aggressive and popular CEO Michael Isner over approximately a 4% drop in profits. The largest transportation company in Orlando, Mears Transportation, has been getting ditzed by Disney lately. So who knows what will happen next. We will see.