Has the economy affected Disney?

[stemikger]

I booked my trip and paid for it in full last year. My job has slowed down and the fear of layoffs are scary.

If things don't improve, I would probably not vacation in the next three years and try to pay off my mortgage in case of a lay off.

Hopefully things improve.

 

[dvc at last !]

subscribing to read later...

 

[gourmetgirl]

Well, if Disney wasn't being affected, then I believe you wouldn't be seeing cutbacks such as Fantasmic! to two nights instead of six. I think this is just the tip of the iceberg.

I expect a marginal increase in prices for 2009 but nothing that is a deal breaker. I think they know exactly how much they can raise prices without people backing out.

I think that you'll see more cost cutting measures as the year winds down and we head into next year.

We were at WDW six weeks after 9/11. They had closed many resorts and consolidated what few reservations remained into just a few. They weren't offering us any discounts, but they found a way to slash expense and keep a decent profit margin in place.

Additionally, I think you'll see a HUGE push/hype for whatever *new* promotion they've come up with. They'll cut costs somewhere and put a bit more into advertising and promotion.

Just my 2 cents.

 

[scgustin]

Well, if Disney wasn't being affected, then I believe you wouldn't be seeing cutbacks such as Fantasmic! to two nights instead of six. I think this is just the tip of the iceberg.

I expect a marginal increase in prices for 2009 but nothing that is a deal breaker. I think they know exactly how much they can raise prices without people backing out.

I think that you'll see more cost cutting measures as the year winds down and we head into next year.

We were at WDW six weeks after 9/11. They had closed many resorts and consolidated what few reservations remained into just a few. They weren't offering us any discounts, but they found a way to slash expense and keep a decent profit margin in place.

Additionally, I think you'll see a HUGE push/hype for whatever *new* promotion they've come up with. They'll cut costs somewhere and put a bit more into advertising and promotion.

Just my 2 cents.

Personally, I wouldn't be surprised to see Disney offer some type of "Book a package, get a free $100 gas card" or "$100 airline voucher deal" as opposed to slashing resort prices.

It's the same way car companies are dealing with the current times. You keep the price of cars steady, but offer "free" gas. People just love seeing the word 'free.'

 

[PeeKooAaa]

Hi

It's is true that dollar is so cheap compared to euro that it is easier to plan a trip to WDW now than let's say few years a go.

But, there is a downside to that cheap US dollar : it affects the price of oil, that is, when dollar is cheap the price of oil increases. And that in turn affects flight prices.

So, while the WDW part of our possible future trip is a "bargain" (I don't know if WDW is ever a bargain but...), the flight part is definetly not. At the moment it seems that our flights (for 2 adults and 1 child) would be about 500 euros more than it was on our last trip.

-Pete

 

[WDSearcher]

I understand all the math of it. In a class I used to teach we would actually find the best way to "fill" an apartment building that will give the most profit while still being maintained. It's about 3/4 full (not using every single variable, of course--it was a regular high school course), but roughly.

But personal emotion and "traveler's" logic work against the math. We feel like we would go if prices were more reasonable--and that includes the travel portion as well (plane or car).

And obviously you can't charge your foreign customers more. But it's not a bad thing if that's who's keeping your hotels full for now. The Europeans are the ones keeping our hanging-by-a-string economy still hanging on. We can't afford to NOT have them come to Orlando or any city.

But I digress.....

I totally agree. And if the only variable was Disney (if it was the inherent characteristics of Disney alone that was causing the financial pinch), the problem would be easier solved. But people aren't deciding not to travel ONLY because of things going on at the parks. It's because airline flights are far more expensive, you've got luggage fees and who knows what kinds of surcharges, food is more expensive, you're buying gas for the rental car ... really, who wants to vacation if you're counting your money every night to be sure you have enough for the rest of the week? It's a really weird situation that, unfortunately, has many many pieces to it.

 

[SlightlyGoofy]

I just read where Fantasmic was only going to be shown twice a week after the first of the year. I am thinking it is probably for money reasons. JMO

SG

 

[WDSearcher]

Down 60%!! Wow!

I think the CMs might have gotten that a bit mixed up. Disney is not DOWN 60%. They are AT 60% of last year at this time. AT 60%, DOWN 40%.

 

[DisFlan]

I think the CMs might have gotten that a bit mixed up. Disney is not DOWN 60%. They are AT 60% of last year at this time. AT 60%, DOWN 40%.

You're probably right, but either way, it's a lot.


DisFlan

 

[CanadianGuy]

I've posted this elsewhere.. but I think this answers the OP's question pretty resoundingly..

WDW Resort attendance which is usually at LEAST around 87% for the first three weeks of July (and sometimes in the 92-95% range.. ) ... is hovering around 65% occupancy for the first three weeks of July.

Normally certain resorts are sold out this time of year and for the past three weeks, they haven't even been using all the available buildings .. Now the sources I have who are very well placed to know these numbers do indicate that the attendance picks up a bit next week.. but still doesn't crack the 80% occupancy level.

For this time of year.. that's bad... bordering on disastrous. June & July are Disney's 'bread and butter' months to a large degree and the guests are just not there.

And when you add to that significant drop in attendance, Disney is paying almost TWICE as much in fuel costs to run all those DME buses, almost twice to run the intra-park/resort buses, almost twice to run the parking lot trams ... than they were in August of 2007.

Then.. factor in that the costs for raw ingredients for the restaurants have been on a steady climb, fed mostly by increased transportation costs; and resort laundry and other areas of the parks are facing increased energy usage costs.

Disney got slammed in 2008 with all the increased costs that are directly attributable to the price of oil.. and no way to recoup those hard costs beyond raising stroller rentals and the 'holiday' dining surcharge.

And remember that a 22% to 30% drop in resort bookings can mean a MUCH larger drop in park purchases and food bills ... in part because those who do bother to make the trip are much most price sensitive and consider carefully every expenditure; often forgoing a TS meal or a souvenir that they might have otherwise bought if their own personal budget wasn't also under many of the same strains as above.

Just something to think about... especially as we near August 1st and what is very likely to be a major ticket structure realignment.. and yes, at the very least.. probably a price increase for comparable entitlements...

To sum up - Yeah, it's affecting Disney big time.

Knox

 

[DisFlan]

Disney got slammed in 2008 with all the increased costs that are directly attributable to the price of oil.. and no way to recoup those hard costs beyond raising stroller rentals and the 'holiday' dining surcharge.

And remember that a 22% to 30% drop in resort bookings can mean a MUCH larger drop in park purchases and food bills ... in part because those who do bother to make the trip are much most price sensitive and consider carefully every expenditure; often forgoing a TS meal or a souvenir that they might have otherwise bought if their own personal budget wasn't also under many of the same strains as above.

Just something to think about... especially as we near August 1st and what is very likely to be a major ticket structure realignment.. and yes, at the very least.. probably a price increase for comparable entitlements...

To sum up - Yeah, it's affecting Disney big time.

Knox

And they're still facing all that free food for the Free Dining offer that starts next month. Bookings will likely be up, but the profit margin probably won't be great. It'll be interesting to see if they offer it again. The Free Dining folks also aren't likely to be big spenders in the parks this year.

DisFlan

 

[charity]

It's not going to change our trip in sept, because we booked so long ago. But DH has already said NO TRIP NEXT YEAR!!! I cry a bit every time I hear it! So next year we are only going on a small trip to cabin by lake that is near our area.

 

[PrincessKsMom]

Have no fear Disney! I'm on my way next month and I tend to spend without a thought! I'm coming to single-handedly save the Disney economy. Two questions though, if someone has an answer: (1) what's the chances of being upgraded to a different resort if they have so much free space (for free, or a nominal fee of course!); and (2) does anyone who's been there recently know if there are any bounceback offers?

The reason for my questions is because I would never stay at a deluxe and I have only stayed at one moderate. However, if I were to be moved to a moderate or deluxe at a worthwhile price, it might make such an impression that I wouldn't be comfortable going back to a budget. (FWIW, I would have gone back to CBR this time, but the main pool was going to be under construction and for me, that was a big deal breaker). Also, as to bounceback, same rules apply. I might stay at a moderate or deluxe next time if I was given a chance to do so at a discount, with a bounceback offer. This is my first time with free dining and it's really not free, because the money I would have spent on dining will now be going for souvenears, BBB, photopass, etc.

 

[WDSearcher]

Have no fear Disney! I'm on my way next month and I tend to spend without a thought! I'm coming to single-handedly save the Disney economy.

We, at Disney, salute you, PrincessKsMom!

 

[ejsteg]

Friends of ours go every July - they were there about a week ago and said they definately saw a drop in attendance. They even mentioned that their hotel (Beach club villas) seemed empty. They did notice alot of international guests. My parents live near Disney and go often and they, too, have noticed a drop in attendance this summer.

 

[LoveKermit]

Have no fear Disney! I'm on my way next month and I tend to spend without a thought! I'm coming to single-handedly save the Disney economy.

Us too!

But I agree that more people are staying and eating off-site. I know it's blasphemy, but there are other places to stay and eat. My parent's and I (when I was in college) and my in-laws and DH and I a couple years ago rented a house. It's so cheap and you can eat-in if you choose.

A little off-topic--someone mentioned gassing a rental car. My parents heard car rental was up 45%. We know how well maintained rental cars are so this number made no sense to us as we are the ones who fill the gas tanks for them. It kept them from flying somewhere and renting a car. They're just driving themselves on vacation instead.

 

[catne]

Yes, I think the economy is already affecting Disney. we were there in both May 2007 and May 2008--basically the same days. Our resort (POFQ) appeared to be less than 1/2 full this year. Parking lot was incredibly empty...never had to wait for a 2nd bus. Short lines everywhere at the resort.

They were taking walk-ins at all the restaurants we went to. This included Le Cellier (at least 1/2 dozen tables empty in the 5:30-6:30 slot) Cinderella's Dinner (empty tables in the 5:30-6:30 slot) Garden Grille...most of the tables were empty at 5:45 (characters actually spent too much time at our table Interrupted our eats!) Previous year, we tried to get into Garden Grille as a walk-in...wait would have been 90 minutes.

And here's another thing...recently I was using Disney's website to price out various resorts at various times of the year to get a feel for what we could afford when. Anyway, 3 weeks ago--the week before the 4th of July--the website was showing availability for 4th of July weekend! That's supposedly booked, booked, booked. And yesterday, I tried the ASMusic family suites for the week before Christmas...again, supposed to be the busiest time...a suite was available. Last year whenever I tried to ask for the family suites on the website to see what the cost would be, I could never get a price idea, because they were always booked.

Not everybody is cancelling vacation, but I do think even some of the people who have booked & paid long in advance are cancelling & getting their money refunded. I know of a couple of people who have cancelled expensive paid-for vacations, including an anniversary cruise to Hawaii. Most of their money was refunded - and they needed it due to job lay off. (lost only $150 booking fee)

 

[Tink3Bell]

Maybe people go and spend less instead of cancelling or stay at a cheaper hotel.