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Disney details vast theme park expansion projects

Disney details vast theme park expansion projects
11 Aug 2024 22:31

The New York Times News Service

When Disney announced last year that it planned to spend $60 billion over the next decade to expand its theme park and cruise businesses, double the amount spent over the previous decade, the company’s stock price instantly dropped.

Wall Street wanted specifics that the company wasn’t prepared to give. Disney fans were excited for a hot second - and then they too started to demand answers, venting on social media about feeling baited. Was Disney being hypothetical about the expansion (as it has been on occasion in the past), or was this for real?

On Saturday, Disney finally showed its hand. The company is building four new cruise ships, on top of four others it had previously announced, almost trebling the size of its current fleet by 2031. 

The Magic Kingdom, Disney’s flagship theme park in Florida, will undergo the largest expansion in its 53-year history, with one new "land” devoted to classic Disney villains and another focused on Pixar’s "Cars” movies. The Disneyland Resort in California will add two superhero-themed rides, a water-based "Avatar” attraction, the company’s first "Coco” ride and a Main Street, USA, show starring an animatronic Walt Disney.

"We’re dreaming big,” said Josh D’Amaro, chair of Disney Experiences, which includes theme parks, Disney Cruise Line, video games and consumer products. "We’re investing in every part of our portfolio and pushing boundaries as we turn what-ifs into reality.”

Disney is also working on a "Monsters, Inc.”-themed suspended roller coaster (with cars that hang under the tracks), a ride-through "Encanto” experience, a "Lion King” water ride and a major "Spider-Man” roller coaster. The project list, which includes new nighttime parades and elaborate outdoor pageants that Disney calls "spectaculars,” goes on and on.

D’Amaro detailed the projects - they’re all happening, he insisted, nothing conceptual - during a three-hour evening presentation at D23: The Ultimate Disney Fan Event, a three-day gathering in Southern California. D23 is a reference to 1923, the year Walt Disney arrived in Hollywood.

One important caveat: The ships and expansions detailed Saturday, while vastly expensive, do not add up to $60 billion.

That sum also covers still-secret rides, resort hotels and shopping and dining areas that Disney is planning for the longer term, along with technology and infrastructure investments.

D’Amaro’s presentation, in the works for months, came three days after Disney reported weaker-than-expected theme park results for the quarter that ended June 29. Operating profit declined 3%, to $2.2 billion. Disney blamed a "moderation of consumer demand” that "exceeded our previous expectations,” along with higher operating costs. The post-pandemic surge in travel has worn off, Disney said, and lower-income Americans, battered by years of high inflation, have cut back on discretionary spending.

Disney, of course, is in the theme park business for the long haul, and many of the projects that D’Amaro unveiled will not open for two or more years. Disney’s parks have a long history of bouncing back quickly from economic downturns, in part because many parents view a trip to Disney World or Disneyland as a rite of passage for their children.

Laurent Yoon, a media analyst at Bernstein, a research firm, said in a report Wednesday that, despite near-term challenges for Disney Experiences, "we’re not concerned.”

The biennial D23 event amounts to a giant corporate pep rally, with roughly 140,000 people paying anywhere from $79 to $2,600 for the opportunity to be marketed to. Disney trots out dozens of stars, previews upcoming movies, and hypes Disney television shows like "Bluey” and "Percy Jackson and the Olympians.” Many fans come dressed as their favourite Disney character. Disney being Disney, there are confetti cannons and booths selling $30 glow wands.

It is also a spotlight moment for Disney executives. In 2022, Bob Chapek, Disney’s CEO at the time, tried to use the event to polish his image and turn a page on what had been a tumultuous early tenure. This year, Disney gave media credentials to roughly 1,000 reporters and online writers. Dozens came from overseas.

D’Amaro, 53, is a candidate to succeed Bob Iger as Disney’s CEO when his contract expires at the end of 2026. Iger came out of retirement to retake the helm at Disney when Chapek departed.

On Saturday, D’Amaro came across very much like a Mouseketeer in chief, striding onto the D23 stage - where a 70-piece orchestra awaited - in a zip-up sweater and jeans and effortlessly commanding the 12,000-person arena.

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