When Covid-19 shut down the nation's theme parks in March, we asked What happens next? for Disney's planned construction projects at Walt Disney World and Disneyland. Now that we're two months into this closure, we are getting a clearer picture of which projects will — and will not — proceed as planned.
In Disney's latest earnings call, new CEO Bob Chapek said that Disney would "take a slightly finer-tooth comb, if you will, through those expenditures." That process is on-going, but we are hearing from multiple sources in Burbank, Glendale and Orlando what Disney's priorities will be for the Walt Disney World Resort going forward from now.
Top of the list is the Star Wars: Galactic Starcruiser, which Disney wants to begin accepting guests next year. Disney World's Star Wars hotel was designed as top-dollar attraction, and its high yield on a low customer base makes it especially attractive to Disney now. Construction was well along before Disney stopped all work in March, but the company wants to get this project going again ASAP, as it looks for a lucrative new revenue stream in a time when no one's optimistic about attendance.
Galactic Starcruiser never was intended to serve a large number of guests, so Disney doesn't care if thousands of people who never were going to get into the hotel anyway no longer feel that they can afford this premium, interactive experience. If Disney can just fill its 68 rooms for each two-night adventure, then this project will add much-needed cash to Disney World's bottom line.
Beyond that, the next priority is to fix the current construction mess in Epcot's Future World. The park's entrance and central plaza might not end up looking as grand as the concept art Disney's been showing off inside the former Odyssey restaurant, but Disney can't leave half-torn-down buildings and a maze of construction walls up indefinitely while it waits for the global economy to recover. Imagineers will be working on a redesign of the World Celebration plans with an eye to reducing construction and maintenance costs while getting the project done as quickly as possible. The Dreamers Point/Festival Center structure appears to be gone in these emerging plans.
Elsewhere in Epcot, don't expect Remy's Ratatouille Adventure and the rest of the France pavilion expansion to open until early in 2021, as Disney looks to ride out 2020 with no new attractions, since it must limit park capacities anyway.
The next tier on Disney World's priority list includes its two new roller coasters: Epcot's Guardians of the Galaxy Cosmic Rewind and the Magic Kingdom's TRON Lightcycle Run. Both of those rides now appear slated for 2022 (with TRON earlier in the year and Guardians later), as Disney slows or delays construction projects beyond its top priorities.
The Harmonius show on Epcot's World Showcase lagoon and the Cirque du Soleil Drawn to Life show at Disney Springs are in limbo for now while Disney awaits guidance on mass gatherings... as well as the financial future of Cirque du Soleil, as the Canadian entertainment giant looks to avoid becoming the latest victim of a private equity leveraged acquisition. The longer these productions remain in limbo, the less likely they are to survive in their originally planned forms.
Other projects, including the Spaceship Earth revamp and the Play Pavilion, now lie at the bottom of Disney's priority list, with their futures dependent upon attendance and guest spending levels over the next 12 to 24 months.
As for hotels, you can forget about the Reflections Resort hotel project on the old River County site, as it's been shelved. Disney is sweating being able to fill its existing room inventory for the next few years. It's going to be a long time before Disney sees a solid business case for expanding that inventory... beyond its Star Wars boutique resort, of course.
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Like the article said, it's not about construction or construction workers, its about not opening new attractions with thousands of people trying to jockey into the parks and being turned away...
Say they open Guardians and the parks are still at 50%, even a park like Epcot with a high capacity would probably see guests in huge queues outside trying to wait to be admitted and ultimately people spending days outside theme parks they can't get in to!
Its better to wait until the parks can handle the volume to reopen..
Economically, even if the desire to travel to Disney is strong (despite capacity and social distancing practices) many savings and vacation funds have been scrapped, so the amount of people travelling will be lower...
I've heard that Tron is still a go for 2021 as they want something new at Magic Kingdom for the anniversary, but it will likely be a fall opening rather than the late spring/early summer that was intended. Guardians is definitely delayed until 2022 as Epcot doesn't need two new attractions in one year, and depending on demand I've even heard there is serious consideration being given to leaving Epcot closed all the way until the Future World construction is done (or potentially only opening World Showcase). Pretty much everything else lines up with the above...if it wasn't slated for 2020 or 2021, it's being pushed back 1-2 years if it was already vertical and shelved indefinitely if it wasn't. Orlando's tourist market is going to be hit hard, and most forecasts I've seen don't expect normal visitation numbers until summer 2021 at least.
I feel sorry for Epcot most here. It is still one of my favourite parks, but it always seems to be the park that gets most short changed in terms of budget cuts- I’m not sure there’s many attractions there where the finished article is anywhere as grand as originally realised. I guess time will tell...
Two associates report tower cranes at TRON are coming down. If that's true TRON will not open in 2021.
How about the budget for maintenance, I expect that will be cut even more. So expect more accidents with the monorails, people mover, cable cars, Jungle Cruise and what not.
With 2+ months into this pandemic here in the United States it’s been like riding a roller coaster trying to predict what the future will hold.
I don’t doubt that Disney will survive this, but I’m still having a hard time seeing how this is a business model that can sustain any business long term with no attendance for 2+ months, and then 25% - 75% capacity for another 12-18 months (assuming there’s a vaccine).
How can any company maintain enough business to be profitable?
How is this not going to batter their finances for years or decades to come - and allow them to recover?
Is legislation being passed by government really helping all these companies and businesses from going under?
The delay of Ratatoille doesn't really make much sense. The attraction was likely just a month or more from starting load testing, so it doesn't really make much sense to mothball it for the remainder of the year. EPCOT could really use another attraction to help spread out crowds in the likelihood that virtual queuing is the way forward. EPCOT is going to be hard hit in terms of attractions in the wake of restrictions with so many interactive exhibits and show-based attractions that will either be closed or extremely limited. Having another ride-based attraction, particularly one that would draw guests to the opposite side of the World Showcase Lagoon from Frozen Ever After, seems like a necessity in the wake of revised park operations and procedures.
@TH - Are the Tron cranes perhaps coming down because all of the structural steel and coaster track are in place?
I get the reasoning behind putting the brakes on attractions that were still in the early stages of development, but for those that have already passed the "point of no return" with vertical construction already in process, I don't see the benefit of slowing or stalling this work now because of the reduced benefit to market at "new" attraction to what will be a limited audience. The cost to delay opening is likely to exceed any additional revenue generated from waiting to market the new attractions to a capacity crowd.
I don’t understand why construction can’t continue, if it was previously budgeted, the money should still be in that ‘bucket.’ They can finish projects/attractions and not yet open them, if they’re worried about demand/capacity.
It’s money you can put into another bucket, and it’s a standing asset you don’t have to maintain.
Amy Tupper: "I don’t understand why construction can’t continue, if it was previously budgeted, the money should still be in that ‘bucket.’"
Me: Because of the massive uncertainty associated with cash flow company-wide. No money from park tickets, food, retail, hotels and other services. No movie box office revenue. No cruise ship revenue. Huge impact on vacation club sales (which may go on for years). No certainty in ancillary businesses (i.e.: airlines). The money budgeted for the attraction construction is likely needed elsewhere.
@nypark writes "I’m still having a hard time seeing how this is a business model that can sustain any business long term with no attendance for 2+ months, and then 25% - 75% capacity for another 12-18 months (assuming there’s a vaccine)."
My money says that one of two things is going to happen with America's rush to reopen: either (1) the virus is going to come roaring back, either now or in the fall, and we'll be forced to go back into a general shutdown, in which case I think your numbers will be correct, or (2) a miracle will occur, the virus won't re-surge, and Disney will back to business as usual by September.
Disney does not know yet (if and when they open) if they will be able to remain open. If the pandemic rages out of control the only thing certain in the future is a 2nd indefinite closing.
While I would rather hold a long term positive outlook, it has to travel a parallel path with caution.
That said, I think they are better shutting down all the projects until mid 2021. They need that funding to restart their operations when they establish the long term plan.
@thecolonel: Or three, a balance of "hot spots" here and there while other parts of the country aren't as affected. Tricky part being predicting where said spots can be and how they're handled. The issue again being the lack of widespread testing and folks who sadly think wearing a mask in public is like having numbers tattooed on your arms or that "it's just a flu."
Here is a great question to start with... does anyone understand what the demand will be the next 18-24 months. I have no idea what so ever. Disney doesn't have a complete picture until they open and see if they are selling out limited capacity tickets.
They will most likely have high demand at first however, as people are witness to the restrictions that demand curve is likely to trend down...
@leastinteresting - I think it's pretty obvious that demand will outstrip the artificially decreased supply. There is a huge thirst for entertainment right now, and with summer vacations to other destinations being postponed or cancelled, people will be naturally drawn to a place like WDW where they feel the operators are doing the right thing and adhering to the safest protocols in the industry.
The cruise industry has already announced bookings 18-24 months out are almost back to advanced purchase levels from 2017-2019. Not only that, but most of those cruises are being booked with cash, granted almost every operator is using extremely lenient return and cancellation policies to lure those advanced bookings.
I think WDW will have no problem reaching "capacity" (whatever that number may be), it will just be a question of whether they can find an acceptable balance between adhering to safe practices while admitting enough guests to make all the the extra expense worth it.
A well organized theme park operation (especially one with Disney's brand recognition) doesn't have to attract 50,000 people a day to be profitable. Especially if there are a limited number of attractions operating and the labor requirements are a fraction of what a fully functioning park requires.
@thecolonel. I’d add a fourth option. The virus resurges, and it’s generally accepted to do nothing (or near nothing) about it. Domestic tourism occurs (probably at some reduced level) but international tourism crashes to near zero as flight bans and quarantines make leisure travel to the US impossible or impractical. Instead International travellers go to whatever low risk countries there are “air bridge” agreements with (DL Paris is looking like a serious option to me now as we’re expecting France to be excerpt from any quarantine requirement when returning to the UK)
It’s an option I would like to be able to rule out. But I can’t get there.
@LeastInteresting. If it helps, BA and Virgin Atlantic don’t expect demand for air travel to return to 2019 levels for about 3 years.
If new attractions were only available through virtual queues and/or fast pass, that's the way to control the cluster of people that would normally pack a queue. Of course, even with the aforementioned, they would have to be allowed in one party at a time.
I also dont know what happened next instead of I read something from there
https://drugruger.com/
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Personally, I think they should go full speed ahead on their construction and expansion plans...but I understand why they're not.
I give them full credit for having reinvested billions into their park in the past several years. Still, it's disappointing that TRON lightcycle probably won't be open next year. Why leave a half finished attraction sitting there for a year and a half?