el_super
Well-Known Member
It does.
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News Expect closure of Hong Kong Disneyland and Shanghai Disneyland to impact Walt Disney World
- Thread starter wdwmagic
- Start date
It does.
xdan0920
Think for yourselfer
Without getting too deep into the weeds with you here....
No company, especially not TWDC, has a
To save money. That’s not a thing.
Scrooged
Well-Known Member
Regardless of the impact to the company as whole, I have to wonder what political machinations went into the decision to close the parks. How much was the state involved, how much pressure did it take to get Disney to close, and is this in response to the poor actions the Chinese state took during the SARS thing.... Just random questions that we will never know the answer to- at least not in the near future.
No Name
Well-Known Member
It’s not.
HKDL lost 6.9 million dollars in 2018. The park is actually more profitable when it is closed. SDL is somewhat profitable though, but not by much.
@realBobChapek then maybe Disney shouldn’t have overextended itself. If the parks close forever because they aren’t cost effective, then so be it. The best ideas win the day, not the money-losing ones.
On that happy note, looking forward to celebrating our 20th anniversary with DH at WDW next week!
DDLand
Well-Known Member
Nah, it’s going to hurt profits. Think fixed costs. Disney will still have to support its employees and provide benefits. The two resorts have approaching 20,000 cast members (10,000+ SD and 7,500+ HK). The assets will continue to depreciate without any revenue offsets. The resorts can’t be left to rot, so upkeep and maintenance will still have to be a focus. Merchandise inventory that’s seasonal or limited edition will be written off. Probably more.
Obviously, the sums are diluted by not owning the assets in totality, but this could offset some of the momentum of Galaxy’s Edge. If Disneyland is really having disappointing performance as @WDW Pro alluded to, we could see another soft year of growth from Parks and Resorts. They have a good excuse, but this was a year when Parks, Experiences, and Products was supposed to crush it. Walt Disney World is going to have the difficulty of overcoming the Asia shutdown and a soft Disneyland.
That ship has probably sailed. The organization that could devour the parks are few. It could easily be worth 70+ Billion. I could see a spinoff “to unlock shareholder value.” With that said, that would be Walt Disney Co. giving up some of its heft. Disney is competing against 1.4 trillion Apple and massive Comcast. It doesn’t hurt to be bigger in a space like the one that is brewing...
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DDLand
Well-Known Member
I’m speechless. They are so daft.
Nubs70
Well-Known Member
There is no second thought in China. If the government says, shut down, business shuts down.
Happens to some of my production plants. It's smoggy? Shut down production.
WDW Pro
Well-Known Member
Closing a park for even a day is a major financial hit, although for the entire company it's easily manageable. Because the park is in China, it's a bit harder to figure out how much the hit is per day, but it seems like it's about 8 million a day in losses. One of the difficulties is that not only does the park not generate revenue, but upkeep of a park is immense whether guests come or not.
Doug Means
Well-Known Member
these are closing? especially before i get to visit them?
BrianLo
Well-Known Member
The difference for me is between should and would. Should it effect a different unit? No. Would it? Well for that the question in return: is the company run by a bunch of idiots who don’t look further than two feet in the future?
Thanks Shanghai was a cute little movement for Domestic park fans to blame their reoccurring woes on an international unit. The run up to opening was plagued with the same cost overruns and panic that has seemingly plagued every park opening in the companies history. But it also now does not account for the fact that Shanghai has been pretty much the single bright spot (that Disney owns) internationally these last few years.
Bob is generally risk adverse though. Its solid successful performance (despite the gong show run up to opening) can be thanked for causing Iger to finally see some value towards investing domestically again.
It also smugly doesn’t account for the last round of cuts, which were all on the domestic parks, were due to a horrible domestic summer.
Hank Hill
Well-Known Member
Because of Chinese New Year, most business will not be effected as much for a while as production would be low anyway. This could all be blown over by then, or all the traveling people make during the celebration will make it worse.
Doug Means
Well-Known Member
oh ok, thanks.
I would not be surprise besides shortening of cast members hours, layoffs of salaried cast that there would be a spending freeze for parks and resorts division. Hopefully safety and security of guests and cast are not the numbers that need to be downsized.
Kman101
Well-Known Member
Never fails.
I love the folks on social media who don't believe Disney works this way.
News flash folks: they do.
Thus is the way of a company focused solely on stock analyst expectations.
Some are not surprised by this at all, knowing the tendencies of those in charge.
It wouldn't be a Disney crisis without price increases.
FigmentForver96
Well-Known Member
I feel this is any large company that runs the risk of losing money. Whether it’s right or wrong is another discussion but not shocking in the slightest. So I don’t understand people who think it wouldn’t happen cause the parks division are one division from my understanding (more complicated I imagine but in simple terms is one big pot.) I also don’t get people who are shocked they would do it.