Disney Defends its Shuttle-Bus Service

[MickeyTigg]

Some critics of Disney's Magical Express say the resort's free shuttle has made deep cuts in their business.


Beth Kassab
Sentinel Staff Writer

December 14, 2005

Walt Disney World executives say their free shuttle-and-luggage service between the resort and Orlando International Airport has boosted airport revenue by $1.6 million and helps move passengers so efficiently that it could delay the airport's need for a second terminal.

The analysis prepared by Disney came in response to criticism of the 18-month pilot project, Disney's Magical Express, which began in May.

Critics -- mostly other ground-transportation companies at the airport -- have said the service has cut deep into their business and that portions of Disney's original contract with the airport gave the entertainment giant an unfair advantage.

Greater Orlando Aviation Authority Chairman Jeffry Fuqua declined to comment Tuesday on the figures provided by Disney. He said airport officials are working to prepare their own analysis of the shuttle service's effect on airport finances and operations.

"What do you expect them to say?" Fuqua said of the Disney analysis. "I would expect them to do nothing else than toot their own horn."

The recent back and forth between the airport and Disney is a rare public power struggle between two dominant forces in Central Florida tourism that typically work out their disagreements behind closed doors.

Since Disney's Magical Express began seven months ago, the airport has changed several key parts of the service -- over Disney's objections.

In August, the airport reduced the number of parking spaces available to the shuttle service's buses from six to four. And in November, it banned Disney greeters -- employees who wore oversize Mickey Mouse gloves -- from the main level of the terminal because no other companies were allowed to meet customers there.

Disney's Magical Express, which is provided free to people staying at Disney-owned lodgings, is the first large-scale passenger-and-luggage service operating at a U.S. airport and is changing the way airports operate, said Jerry Montgomery, a Disney senior vice president.

"It's transformed, in a unique way, the airport experience for folks," Montgomery said. "When you change the paradigm in the market, there's going to be some shifts. There's no doubt about that."

He said the airport's $1.6 million net increase in revenue from May to September when compared with 2004 is the result of rent Disney pays, a 50-cent-per-passenger fee, and fees generated by Mears Transportation Group, which operates the shuttle, and two luggage-transport services.

Still in question is how much money, if any, the airport is losing because of downturns experienced by other businesses, such as rental-car companies and limo services.

In addition to the revenue, Montgomery said, the Disney service is also extending the airport's capacity.

Airport operations are streamlined by the bus service, he said, because about 20 percent of OIA's luggage is screened outside the main terminal, in space Disney rents from Delta Air Lines.

That frees up space at airline ticket counters and within the terminal's baggage system, which in turn could delay the need for the long-talked-about south terminal by seven years, he said.

Airport Executive Director Bill Jennings and Finance Director Maureen Riley were not available Tuesday to comment on those claims, spokeswoman Carolyn Fennell said.

Jennings has said the south terminal would be built after 45 million passengers pass through OIA in a single year. About 34 million are expected to use the airport this year.

Montgomery said Disney's Magical Express has done with private money what backers of a high-speed rail system had hoped to do with public dollars by "approximating a high-speed rail model" with a fleet of buses.

Fuqua, the airport board's chairman, acknowledged that the Disney service is a form of mass transit -- something the airport will need as it continues to grow.

"If you have an airport designed for 80 million passengers, it's relatively easy to draw the conclusion that it's going to be very difficult to move 80 million passengers out of the airport in small vehicles," he said. "At some point, you're going to have to build transit, because you can't build enough roads out of the airport. And this [Disney's Magical Express] is a form of transit."

"The question is: How disruptive is it and how financially disruptive is it?" Fuqua said. "I don't really know the answer to this question."

Today, the airport authority will consider proposals that would keep Disney from greeting customers near the baggage claim, where transportation companies typically find their passengers.

Airport officials want Mears employees, not Disney workers, to perform that role for Disney's Magical Express. Both Disney and Mears have objected to that change.

Meanwhile, Disney officials are trying to come to terms with airport officials on how the service will operate after the pilot program ends in December 2006. Because it plans its vacation packages a year in advance, the company wants to know by early next year what the service will look like in 2007.

"No one really forecast how successful it would be," Montgomery said.

 

[Amber]

I hadn't even put the two things together, but now that I think about it, I've noticed that checked luggage comes a lot faster at MCO than it used to. In the past, I could dilly-dally my way out of the plane, stop and make a phone call, mosey down to baggage claim and even make a stop at the little girl's room, and the luggage STILL wouldn't be there. My last three trips, one arriving 05/06/05, one in September 05 and one in November 05, the carousel was moving when I got down there with no stopping on the way. Anyone else noticed this? Could it be because a chunk of the luggage is going with Magical Express and it makes everyone else's luggage get there quicker? I've never used Magical Express because we have to have a car - we sometimes need to leave to go visit friends and family that live near Orlando, so I've never had the need for the service, but I had never thought of this before.

 

[kkar2005]

Is this just sour grapes from some people because they didn't think of it first? I will be using this service for the first time next week. I would love to see someone from Disney greet me so I don't feel so lost when arriving there. There is a slight fear of the unknown that Disney has tried to take care of by having a greeter and taking my luggage to my hotel.

I would think we all would rather have private money take care of things than have to use public money. Doesn't everyone complain about the taxes they have to pay?

Just my .02....

K

 

[Quicksilver]

Sour grapes, maybe, but the reality is that ME is not working as great as it should for many many people.

Please read the following threads from other discussion forums:

www.tagrel.com/forum/index.php?name=PNphpBB2&file=viewtopic&t=15216

www.disneycentral.com/forum/showthread.php?t=23080

I'm sure many are having a good experience with ME, but remember it will only be free for 1 more year; after that they say it could cost up to $40.00 per person. Disney is now already paying $25.00 per person to Mears, and $0.50 per person to the airport. Who do you believe is really paying for this "free" service. You are.....Directly in your total package deal, or indirectly in the parks, restaurants, and souvenir shops. ME was a way Disney found to keep everyone inside their property and not spend any money shopping outside, or having dinner somewhere else (if you have a rental car). They set this free ME for 1 1/2 years, enough time to break down all the small transportation companies around; only a few will survive this period! Quicksilver will be one of them...:sohappy:

My best regards to all,

Gregory Nicolas.

 

[Monty]

Disney may keep it free... They can offer it to everyone by including the costs in the package prices, knowing full well a lot of people won't take advantage of it. This means if their cost is under $30/person, the average increase in package cost would likely only have to be $15-20 to break even. Given the package costs, even if they've jumped more than $20, most people would hardly notice in the grand scheme of things and Disney would be profiting from something that costs them virtually nothing.

 

[Quicksilver]

Disney may keep it free... They can offer it to everyone by including the costs in the package prices, knowing full well a lot of people won't take advantage of it. This means if their cost is under $30/person, the average increase in package cost would likely only have to be $15-20 to break even. Given the package costs, even if they've jumped more than $20, most people would hardly notice in the grand scheme of things and Disney would be profiting from something that costs them virtually nothing.

It's costing Disney $25.00 per person reserved with ME (as you all know you must be prearranged now). Which means, if they don't show up for the bus, Disney will pay Mears the $25.00 anyway (you must understand that for something as big, Mears needs accurate numbers to be able to schedule their buses, and if people would just not show up they will want their money anyway). This $25.00 is probably a price paid now, because of the free deal. In one year I doubt the rate will remain at $25.00. This is why I strongly believe this will be an extra service offered but not automatically inlcluded in any packages. Above all I doubt Disney wants to lose the estimated 40 million (if calculated only $40.00 per person), an easy 10 million profit.
What would the share holders say...LOL

And what we are all forgetting is there are two more companies Disney has to pay, BAGS for the luggage delivery and another (forgot the name) for the whole security issue.

Another issue is, by law, Disney has to tell you if there is an extra charge for every service provided, if not, they must say it is free. They can not simply include a extra fee and not tell you. When people find out they can ride in a towncar or van for less they will very quickly cancel with Disney/Mears. That is what was happening before with the Mears shuttle and I do not see it going any other way with ME.

But going back to the sour grapes. You are definetely right, they were very sour for a while. Now that 6 month went by, I see that many many people will not use a shuttle even if they are paid for it...:lol:

My best regards,

Gregory Nicolas.

 

[Monty]

Another issue is, by law, Disney has to tell you if there is an extra charge for every service provided, if not, they must say it is free. They can not simply include a extra fee and not tell you.

I fail to see the logic here. If Disney increases the average fee for hotel stays by an amount commensurate with the overall cost of the added 'free' service, they are not legally adding an extra fee. They certainly don't tell me that they charge me "x" dollars for mousekeeping and "x" for pool cleaning, those are just business expenses that are incorporated into my overall bill. Yes, if they were to add a $40 surcharge to every package, they would be required to disclose that, but I think they are factoring the cost into the general revenue/expense of running the resorts.

But going back to the sour grapes. You are definetely right, they were very sour for a while. Now that 6 month went by, I see that many many people will not use a shuttle even if they are paid for it...:lol:

My best regards,

Gregory Nicolas.

Given your affiliation with the competition to DME, I can understand the sour grapes. The links you provided as evidence of problems with DME have a significant number of positive testimonials as well [I certainly wouldn't categorize the threads as indicating that "many many people will not use a shuttle even if they are paid for it...", but you're entitled to read them the way you wish]. I think people will assess the service for themselves and if you're right it won't matter if it's free, it won't survive. I haven't used the service as yet, but given my experience with other things Disney puts its name to, I expect I'll have no problems and will continue to use the service in future.

 

[Quicksilver]

I fail to see the logic here. If Disney increases the average fee for hotel stays by an amount commensurate with the overall cost of the added 'free' service, they are not legally adding an extra fee. They certainly don't tell me that they charge me "x" dollars for mousekeeping and "x" for pool cleaning, those are just business expenses that are incorporated into my overall bill. Yes, if they were to add a $40 surcharge to every package, they would be required to disclose that, but I think they are factoring the cost into the general revenue/expense of running the resorts.

The fee you pay for the hotel does, of course, include the costs to run the resort itself (housekeeping, etc...). They can increase the rates and hide charges for ME, but since this service is subcontracted, I doubt they would do that. They try as hard as possible to lower resort rates to attract people to stay there (which they have been doing lately). I do not think they would increase rates and risk losing guests to other non Disney resorts. The whole idea of ME is to keep you inside their area. Trust me, a family of 4 paying $160.00 more might decide to go elsewhere to spend the night...
BTW, all the budget resorts increased their occupancy since ME started due to lower rates and free shuttle.

Given your affiliation with the competition to DME, I can understand the sour grapes. The links you provided as evidence of problems with DME have a significant number of positive testimonials as well [I certainly wouldn't categorize the threads as indicating that "many many people will not use a shuttle even if they are paid for it...", but you're entitled to read them the way you wish]. I think people will assess the service for themselves and if you're right it won't matter if it's free, it won't survive. I haven't used the service as yet, but given my experience with other things Disney puts its name to, I expect I'll have no problems and will continue to use the service in future.

The sour grapes were there only in the beggining when we lost a big % of our business to ME, even though we DO NOT provide shuttle service. Now we see it clearer and the grapes are very much sweet. Business is growing, new contracts came, and faithfull clients are returning. After tasting ME, many old clients realized that saving $100.00 might not be the best deal around afterall.... I never said ME is not good, all I said was read the threads and makeup your own mind. There are many other threads with good reviews of course, but why not throw a little bit of the bad aswell. I'm not in any way hiding the fact I'm the "competition" and I will certainly not send you the good reviews . Just doing my job and trying to show everyone they (ME) are not flawless, and that for many it might not be the best way to go.

By many many people I meant the many many people that call Quicksilver and tells us they will NEVER use ME again even if paid for it. The threads I showed had nothing to do with my last statement.

So, if you come with your family (let's say you have a wife and two kids), ME costs you $40.00 a piece ($160.00 plus tip), you enjoyed their services when it was free, you tell me you wouldn't use a towncar for $100.00, have your luggage with you, a 30 minutes stop for groceries, private chauffeur meeting you and helping with your luggage, and above all saving a few dollars.

Come on MontyMon, try us once and be spoiled by us. I guarantee you'll be extremely satisfied to arrive at WDW before everyone else and leaving after everyone else (with your luggage at hand). Also, with the savings on soda, water and snacks you'll buy at the free stop, you'll be even happier. .....:sohappy: Anyway, that is what most people that used us before feel....

 

[Monty]

The sour grapes were there only in the beggining when we lost a big % of our business to ME, even though we DO NOT provide shuttle service. Now we see it clearer and the grapes are very much sweet. Business is growing, new contracts came, and faithfull clients are returning. After tasting ME, many old clients realized that saving $100.00 might not be the best deal around afterall.... I never said ME is not good, all I said was read the threads and makeup your own mind.

Ok, my bad, I had the initial read that you were flaming ME because you were losing money as a result [I'm glad your business is bouncing back]. I still take it that there's some bitterness there, but competition does that :lookaroun. I have heard good things about your service, don't get me wrong. I just find the current ME set-up hard to argue with. I don't need the water and snacks picked up on the way and there is a certain allure to the care-free pitch Disney makes.

Come on MontyMon, try us once and be spoiled by us. I guarantee you'll be extremely satisfied to arrive at WDW before everyone else and leaving after everyone else (with your luggage at hand). Also, with the savings on soda, water and snacks you'll buy at the free stop, you'll be even happier. .....:sohappy: Anyway, that is what most people that used us before feel....

I may do someday, but initially it wouldn't be as cost effective. I'll be travelling with only my son for the foreseeable future. I suspect that even if [when?] they start charging a fee for the service, it'll still be below your rate if we're just two. So unless you're running a dating service for 46-year-old, disabled, single parents... :lol: We're likely to be too small a party to make yours a value-added service But I never say never...

 

[Quicksilver]

I may do someday, but initially it wouldn't be as cost effective. I'll be travelling with only my son for the foreseeable future. I suspect that even if [when?] they start charging a fee for the service, it'll still be below your rate if we're just two. So unless you're running a dating service for 46-year-old, disabled, single parents... :lol: We're likely to be too small a party to make yours a value-added service But I never say never...

Let's wait and see how much it will cost for two with ME; but you are right, usually you should have 3 or more to be the same price as coming with us (or cheaper). But who knows you might be willing to spend, let's say $20.00 more, and ride in a beautiful towncar, have our driver help you from beggining to end, and saving probably 1 to 2 hours on the return day (just that is worth $20.00 :lol: ).

My best regards,

Gregory Nicolas.

 

[lewisc]

DME worked great the two times I used it. I agree some guests, particularly those who want a grocery stop, arrive at night or want personal service will do well to consider a towncar.

Disney will have a problem if they start charging for DME. Families of 3 and 4 will probably save money with a towncar. Even couples may pay the extra few dollars for a towncar or rental car.

DME works great (sorry Greg) because the large number of passengers allows the buses to be dispatched quickly with only a few stops. Most guests get to their resort 60-90 minutes after their flight lands. Charge and the number of passengers will drop, the service will deteriorate and more guests will pay the extra $$$ for alternate transportation.

My guess is the first thing Disney will do is charge someone for the remote check in. They'll either charge the guests or try to get the airport or airlines to subsidize the service. If it really makes the airport more efficient Disney may be able to get someone to help pay for it. I've read the market price for remote luggage checkin is $10/bag.

I think Disney will have to continue to offer the service for free (or almost free) or the service will fail. My guess is the beancounters are already trying to decide how much extra $$$ Disney is getting from guests who don't have a grocery stop and a rental car. I'm sure they're also trying to figure out how much they can charge, and how much less than can pay Mears, without reducing passengers. Does it pay to do something like charge a flat $20/room to help pay some of the costs? Does Disney have to either keep it free or charge the full cost of the service?

The next logical extension is allow resort checkin at MCO. Guests could then be bused directly to a theme park. They'd either have to let you ship your carryon to your resort or have large enough lockers in the theme parks to handle the luggage. This may help relieve the pressure to have rooms ready for guests who arrive early.

 

[Quicksilver]

DME worked great the two times I used it. I agree some guests, particularly those who want a grocery stop, arrive at night or want personal service will do well to consider a towncar.

Disney will have a problem if they start charging for DME. Families of 3 and 4 will probably save money with a towncar. Even couples may pay the extra few dollars for a towncar or rental car.

That is exactly what happened before ME existed. Parties of 3 or more saved (or breaked even) with a limo service. But, many never had the oportunity to know about it untill it was too late (Disney sold Mears Shuttle directly, like they will sell ME in the future).

DME works great (sorry Greg) because the large number of passengers allows the buses to be dispatched quickly with only a few stops. Most guests get to their resort 60-90 minutes after their flight lands. Charge and the number of passengers will drop, the service will deteriorate and more guests will pay the extra $$$ for alternate transportation.

I think Disney will have to continue to offer the service for free (or almost free) or the service will fail. My guess is the beancounters are already trying to decide how much extra $$$ Disney is getting from guests who don't have a grocery stop and a rental car. I'm sure they're also trying to figure out how much they can charge, and how much less than can pay Mears, without reducing passengers. Does it pay to do something like charge a flat $20/room to help pay some of the costs? Does Disney have to either keep it free or charge the full cost of the service?

I'm sure they know the numbers will drop, but Mears did very well before with the Disney shuttles, and will for sure do well whenever ME is no longer free. Even if charged the same as before which I doubt ($29.00 per person), with all the extra services they do provide now like luggage delivery, I'm sure many, many, many will continue to use ME (again I must remind you Disney will offer to included that service in the total cost, and when you add everything up, $100.00 goes by unoticed most of the time). Only experienced Disney travellers (like you all :animwink: ) know first hand that a Towncar might be the same or less than a bus/shuttle if you have 3 or more in your party. Many travellers do not research when booking their vacation, they trust it all to a travel agent or will listen to only one voice, and that voice is of Disney's customer service and sales people .