What’s next for Disney’s domestic parks after the election

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The fairy-tale is over and the presidential election in the USA is all but decided at this point. Forecasters have tried to imagine what President Trump would mean for domestic and global economic conditions. In almost all cases, the results aren’t pretty. Some predictions, for instance, a global trade war or worse a real fighting war in Europe, are very dire.

Judging by overnight market reactions, I think it’s safe to say that both domestic and international travel will be impacted by the results of this election. The question is how much and how soon.

Walt Disney World and other Orlando tourism attractions had been doing fairly well even with travel from Britain and Brazil impacted by recent economic troubles in those two big travel partner countries. But a loss of much more travel could mean serious cutbacks in the parks.

In the parks, I would expect Disney to start dialing back the number of workers it employs almost immediately. With Avatar-land at Disney’s Animal Kingdom almost complete they’ll definitely finish that (although they’ll look for any last minute cost savings meaning some of the immersive details will be lost). I would also expect Disney to finish Star Wars Land at Disneyland (although there might be more cuts) to keep locals happy.

In Orlando, Disney might decide to only build Toy Story Land at Disney’s Hollywood Studios and place a hold on construction on Star Wars Land until more is known about the state of the global economy going forward. Disney did this before leaving half of Pop Century to become a ghost hotel until economic conditions improved enough after the 2001 9/11 attacks to support those new rooms. For an idea of what we’re looking at here, it took nine years for the travel and leisure industry to recover from that economic dip.

I’m sure there will be other changes too. Disney will have to rely more on locals to sustain the parks. This is not such a big deal in California where there is a huge population within a couple hours of driving time. In Orlando, the pickings are bit thinner and Disney World has been cutting back on perks for locals lately creating some ill will.

Next come admission prices, which have grown at a pace much greater than inflation recently. Look for larger discounts on multi-day tickets than we have right now. I’d expect bigger discounts to begin on day 2 or 3 for locals too.

Worst case scenario? Disney sells off the parks (in large part due to their high operating and maintenance costs) to raise cash as its broadcast assets continue to under-perform. It wasn’t too many years ago this was a serious option on the table. Don’t be surprised to hear the idea proposed again.

If economists are correct, it’s going to be a rough couple of years for everyone. What’s happening in Orlando and Anaheim may not seem all that important in the scheme of things, but we’re a Disney blog, so this is what we talk about. Do you think this forecast is accurate?

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21 thoughts on “What’s next for Disney’s domestic parks after the election

  1. Jose Mendoza

    Was planning to go to Anaheim this Christmas but with Trump win and being a Mexican, might have to consider cancelling my trip. Dollar-peso rate has skyrocketed.

    Reply
  2. Mark Bell

    While your prediction could certainly come true, don’t you think it’s a bit premature to suggest that Disney is going to cut back “almost immediately”? I agree that Wall Street is nervous as evidenced by the overnight futures, but that is due to uncertainty at this point, not because the economy is teetering on the edge of disaster. I agree with you in that under a Trump presidency, no one truly knows what to expect and again, that is reflected in the futures market. But please don’t try to incite panic by claiming that Disney is going to cut back and that the sale of the theme parks isn’t out of the realm of possibility. Stick to Disney and leave the finance side to the experts.

    Reply
  3. Mark

    Thanks for the doomsday scenerio after disney posted a $6.9B year from their studios. I don’t understand how people think a person who is an expert negotiator will destroy the US economy. Maybe if anything we’ll ee half of the goods sold in the parks will be manufactured domestically versus in china. Our only hope is the predictions will be just as wrong as the election predictions themselves

    Reply
  4. WDW Canuck

    I think one of the bigger indicators of what’s to come will be not so much the rise and/or fall of the markets, but what if any real change happens to immigration policy. If its more difficult for foreign tourists to travel to somewhere, they won’t. That’s where it affects British, Brazilian and even Canadians from going to Disney.

    I agree with your assessment about Toy Story Land only in DHS–they need something there, so it makes sense.
    Avatar-land is near completion, so I would expect that to finish as they planned. Given the amount of effort and tech that was used in Shanghai, I doubt they could scale it back significantly at this point, as people will come to expect the next level of entertainment. No further projects beyond what has been announced.

    Disney has enough strong assets around that I can’t see them ever letting go of the parks. The movie division is strong (Marvel, Lucasfilms, Pixar) . Networks provide a medium to enhance the message and the brand, though I would expect to see a ramping up on media that address the cord-cutting that continues to grow.

    No new acquisitions, so not buying Netflix, but continued partnerships to enhance the brand.

    For the first time in a long time I can say it without sounding too corny, the world needs Disney. Its message, its icons, its safe place where everyone is welcome.

    Reply
    1. William Smith

      They did not try to sell of the parks. It was a hostile takeover by Comcast which the board squelched. Then Comcast bought universal.

      Reply
  5. Jim

    Rubbish! Donald Trump is going to eliminate thousands of pages of regulations on small businesses. Those small business owners and employees will then start to make profits and guess where they will take their families on vacation to celebrate their new found gains.

    Reply
    1. George del Castillo

      Right on Jim. Give the guy a chance. I am saddened to see that politics has crept into the Disney Blog. has this now become a political blog? If so I want out.

      Reply
  6. Ansley

    At one point WDW extended their FL resident tickets to those in GA and AL as well. Is there any data on how they faired from that offer? It was an extra incentive for those who live within a reasonable driving distance to vacation there as well as stay, eat, etc.

    Reply
  7. David Gunder

    By your blog, you sound as if you supported Clinton. If you seriously think it will be bad under Prrsident Trump, then you are too young to know the Clintons. I did worse financially under Clinton than any president. I feel that businesses will have many of the restrictive policies lifted and will prosper. That includes Disney. So, no I do not agree with you.

    Reply
  8. George del Castillo

    Let’s keep politics out of Disney. Disney should be a place where we can safely dream and play. I do not need any more politics of hate and fear. Now, I need some peace and diversion. I hope that this crap stops and that this one is removed.

    Reply
  9. Joe Splinter

    I find the whole article a bit creepy. The markets usually react unfavorable to surprise and uncertainty, but they will bounce back. I don’t believe we can extrapolate Trump’s victory to Disney possibly selling off its parks!

    Reply
  10. MonoAutoRail

    Immediate layoffs, half-completed projects, cancelled projects, parks sold, deep discounts to keep people coming through the gates. What rubbishy, fantastical doomsday buggery boo.

    Reply
  11. Gary Pearson

    My family is upset about the election of Donald Trump. We won’t be coming to Florida this year. I’m also concerned about the proliferation of guns in America.

    Reply
  12. Debra boushley

    I want to go Disney world next year. But if they raised it too high. Then I can’t afford it after this election. I am very up set. Then I will plan to go to Lancaster Pa instead of Disney.

    Reply
  13. Ross

    When are economists ever right? Markets are near record highs – for now. But I do think your assessment on tourism is going to be correct in the long run, and park attendance will suffer. The next year is going to be interesting.

    Reply
  14. Disney Mike

    I’m trying desperately to look at things in a positive way. During the George W. Bush administration, attendance dropped off to nearly nothing, so the parks were a lot less crowded. Of course, we had unemployment issues (like so many others) after Bush destroyed the economy, but at least Disney World was a very pleasant place to be. The Obama administration did so much to improve the economy that the Disney Parks have become unbelievably crowded these past couple of years. A decline in attendance is about the only positive thing I can see under a Trump presidency, since pretty much every economist says that skyrocketing national deficits will cause an unprecedented economic crisis.

    Reply
      1. Disney Mike

        Yep. Once more regulations get removed and those tax cuts get passed and the government runs out of money to pay for things, the economy will crash in a way we haven’t seen since 1929.

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