Different perspective on park openings.

SPJoeG

Earning My Ears
Joined
Aug 9, 2012
I hope this is the right forum. I love the shows, have used dreams unlimited, and just made my first magic candle company purchase, literally right before I posted this. I'm a father of 2 and we live in the northeast and I have a west coast vacation that includes Disneyland booked for early July. Just a bit of background before I offer a different perspective on the parks and resorts opening.

My view is that unlike Shanghai where the government is a partner, in the US federal and local governments will set a baseline, but Disney will make decisions unilaterally. I don't think the parks will open until there is much greater testing and contact tracing or some other change in circumstance such as significantly diminished transmission in the summer or an effective treatment or vaccine. I think Disney is preparing for the best, but expecting the worst, by taking reservations and booking fast passes in June.

Diminished capacity means diminished revenue, and the precautions necessary require additional operational costs (e.g. more cleaning supplies, more staff to clean, masks and gloves for staff, etc...). I see opening in June offering little reward to Disney while coming at great risk to the brand. While my kids have been to WDW this would be their first trip to Disneyland and I would bet like me Disney is considering whether a magical experience is possible with such tight restrictions. More importantly by opening to early there is great risk of "super spreader" events.

I haven't cancelled my trip but it's hard for me to see how any US parks can open while testing capacity is so low, and when we do ramp up to the capacity of China, it will still take a few weeks to actually perform the required testing and contact tracing. I know my view is more pessimistic than Pete's, but please don't take it as entirely negative - I think the parks will reopen and I for one will appreciate them even more, but it will require a lot more testing.
 
I think it was a mistake to rebook people in June. It creates an artificial pressure and expectation to open on June 1st rather than wait for it to come on it’s on. I agree with everything you said about what should happen and hope Disney takes that stance.

I think at this point Disney will try very hard to open June 1st and do it. I think the virus has been somewhat overblown and I am so over the quarantine and scared to death of what has happened to our economy. Yet I personally don’t like the optics of Disney opening. WDW is a meeting place to spread this virus far and wide all over again. It’s also a luxury. It should be IMO very, very last.

I think we need to get our kids back to school, get our lives in order and I kinda think Disney should just bow out for a bit. It’s highly unpopular opinion I know, but I am kinda disappointed in Disney for even talking like they are next to go.

In our local county 85% of our cases are now recovered and yet we have high school seniors not celebrating their June graduation traditionally. Why? Because the virus could blow up all over again. I am sorry Disney is losing money but we are all making sacrifices everyday to control these numbers.

Unless there is major shifts in the numbers, (and there could be!) I think it will sour my opinion of Disney if they open June 1st.
 
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I've been observing the Covid model projections, and it confounds me that there is such jubilance with regards to opening the Florida parks compared with China. From the surface, it appears that China and other countries took far more aggressive quarantine measures and for longer periods of time. There seems to be an aggressive stance to open up Florida to an unnatural degree - it’s like a powder keg.

When there was the news about the financial analyst predicting the parks not opening till 2021, I scoffed. But now I get it, and I’m drinking the kool-aid. It has to make sense from a liability standpoint. There’s some bizarre tug of war going on between safety and economy, and I want no part of it. I get it, there are Disney fans, and people who make their livelihood on selling the dream - bloggers, travel agents, or YouTubers, but at some point I have to be a realist and step back.

Is this the Disney I want, that I grew up with, that I enjoyed? Or am I just doing it to go through the motions of doing “Disney”. Put on the mask, stay away, play the part and pretend like you enjoy it? This re-opening feels icky.

I’m trying to do a family vacation for Thanksgiving, but I feel that date is looking too early.
 
Thanks for your replies.

Another thought I had is that Bundesliga is going to resume play next week without fans. IMO Germany has handled the virus far and away the best of any nation, hence their being able to resume soccer. I think it makes sense for some sporting/concert events to happen at reduced capacity, before Disney opens it parks. To me it makes sense to see for example how MLB handles 4000 people at a baseball game for three hours before 20,000 spend a day at a theme park.

The more I think about it the more I believe the 2021 opening projection. Unlike sports, there is no TV revenue for Disney parks to offset operating costs. Disney stated on the earnings call that it will not open the parks before it makes fiscal sense to do so. I don't know where that mark is but it's quite possible that operating under the current guidelines at 25% capacity loses Disney more money than staying closed.

I think there is some confusion between DeSanits' rush to open Florida with Disney's rush to open. I think if Disney wanted to open tomorrow, DeSantis would be happy to let them do it. I think the governor is focused on the short term and the short term benefits are much greater for DeSantis than Disney. I think realistically these conditions are going to last a long time (1-2 years), but this won't be forever. I think Disney will wait to open until the financial reward of do so outweighs the risk to their brand, and there is a good chance that will not occur in 2020.
 


Thanks for your replies.

Another thought I had is that Bundesliga is going to resume play next week without fans. IMO Germany has handled the virus far and away the best of any nation, hence their being able to resume soccer. I think it makes sense for some sporting/concert events to happen at reduced capacity, before Disney opens it parks. To me it makes sense to see for example how MLB handles 4000 people at a baseball game for three hours before 20,000 spend a day at a theme park.

The more I think about it the more I believe the 2021 opening projection. Unlike sports, there is no TV revenue for Disney parks to offset operating costs. Disney stated on the earnings call that it will not open the parks before it makes fiscal sense to do so. I don't know where that mark is but it's quite possible that operating under the current guidelines at 25% capacity loses Disney more money than staying closed.

I think there is some confusion between DeSanits' rush to open Florida with Disney's rush to open. I think if Disney wanted to open tomorrow, DeSantis would be happy to let them do it. I think the governor is focused on the short term and the short term benefits are much greater for DeSantis than Disney. I think realistically these conditions are going to last a long time (1-2 years), but this won't be forever. I think Disney will wait to open until the financial reward of do so outweighs the risk to their brand, and there is a good chance that will not occur in 2020.
Agree with this thread. And look at other cities canceling their major festivals, etc for the fall. All eyes will be on Disney if they open. Critical eyes. It's a huge gamble.
 
Everything’s a huge gamble when reopening the economy right now. Everyone has an opinion on what to do. Disney will reopen with the safety of their guests & cast members in mind. They’re a business too - they need to make money to stay afloat & won’t stay closed until there’s a vaccine. That was never the intention for the quarantines in the first place. It was to the lessen the load on the hospital systems & to ensure that they could handle the cases coming to them for proper care.

That being said - I have not heard one CEO say they’re reopening without regard for human life. Yes, there are people who act unreasonably but those are the minority in the large scheme of things. The majority of people will & do act & think reasonably. People with underlying medical conditions will either continue to stay at home & social distance. Those living with those people with underlying medical conditions, I believe, will do the same.

My husband is a doctor & has been treating Covid patients throughout this ordeal. My mother lives with us & she has underlying health conditions. We’ve had friends contract this virus, all of whom have had to be hospitalized, all recovered thankfully. Not one was older, not one had underlying health conditions, everyone was healthy & practiced social distancing according to the CDC guidelines. In fact, my husband was on call in the hospital last night (spent the entire night in the hospital) & did not treat one Covid patient. That’s great news! Of course, that’s for us locally in Indianapolis.

So, my point with all this - each state will reopen when they feel it’s ok to do so & they’ll do it in stages. Those stages may be like turning on a water spigot slowly at first - but not a drip or trickle because our economy cannot withstand that. But also not a full blown water flow either so as not to overflow the areas with people to potentially spread the virus & thus overrun the medical systems (which was the whole point of quarantine).

If you don’t like how your state is handling how they’re reopening, that’s what elections are for. This is unprecedented. I’m glad I’m not an elected official. You’re never going to please everyone - especially on this issue! Be smart! Wash your hands, be active, socially distance when appropriate, wear masks when in public (for yourselves & others).
 
Everything’s a huge gamble when reopening the economy right now. Everyone has an opinion on what to do. Disney will reopen with the safety of their guests & cast members in mind. They’re a business too - they need to make money to stay afloat & won’t stay closed until there’s a vaccine. That was never the intention for the quarantines in the first place. It was to the lessen the load on the hospital systems & to ensure that they could handle the cases coming to them for proper care.

That being said - I have not heard one CEO say they’re reopening without regard for human life. Yes, there are people who act unreasonably but those are the minority in the large scheme of things. The majority of people will & do act & think reasonably. People with underlying medical conditions will either continue to stay at home & social distance. Those living with those people with underlying medical conditions, I believe, will do the same.

My husband is a doctor & has been treating Covid patients throughout this ordeal. My mother lives with us & she has underlying health conditions. We’ve had friends contract this virus, all of whom have had to be hospitalized, all recovered thankfully. Not one was older, not one had underlying health conditions, everyone was healthy & practiced social distancing according to the CDC guidelines. In fact, my husband was on call in the hospital last night (spent the entire night in the hospital) & did not treat one Covid patient. That’s great news! Of course, that’s for us locally in Indianapolis.

So, my point with all this - each state will reopen when they feel it’s ok to do so & they’ll do it in stages. Those stages may be like turning on a water spigot slowly at first - but not a drip or trickle because our economy cannot withstand that. But also not a full blown water flow either so as not to overflow the areas with people to potentially spread the virus & thus overrun the medical systems (which was the whole point of quarantine).

If you don’t like how your state is handling how they’re reopening, that’s what elections are for. This is unprecedented. I’m glad I’m not an elected official. You’re never going to please everyone - especially on this issue! Be smart! Wash your hands, be active, socially distance when appropriate, wear masks when in public (for yourselves & others).
@JDWdvc2014 Please thank your husband for what he does, and thank you for all your sacrifices I'm sure you've made along the way! And I'm glad all our friends have recovered successfully!
 
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Everything’s a huge gamble when reopening the economy right now. Everyone has an opinion on what to do. Disney will reopen with the safety of their guests & cast members in mind. They’re a business too - they need to make money to stay afloat & won’t stay closed until there’s a vaccine. That was never the intention for the quarantines in the first place. It was to the lessen the load on the hospital systems & to ensure that they could handle the cases coming to them for proper care.

That being said - I have not heard one CEO say they’re reopening without regard for human life. Yes, there are people who act unreasonably but those are the minority in the large scheme of things. The majority of people will & do act & think reasonably. People with underlying medical conditions will either continue to stay at home & social distance. Those living with those people with underlying medical conditions, I believe, will do the same.

My husband is a doctor & has been treating Covid patients throughout this ordeal. My mother lives with us & she has underlying health conditions. We’ve had friends contract this virus, all of whom have had to be hospitalized, all recovered thankfully. Not one was older, not one had underlying health conditions, everyone was healthy & practiced social distancing according to the CDC guidelines. In fact, my husband was on call in the hospital last night (spent the entire night in the hospital) & did not treat one Covid patient. That’s great news! Of course, that’s for us locally in Indianapolis.

So, my point with all this - each state will reopen when they feel it’s ok to do so & they’ll do it in stages. Those stages may be like turning on a water spigot slowly at first - but not a drip or trickle because our economy cannot withstand that. But also not a full blown water flow either so as not to overflow the areas with people to potentially spread the virus & thus overrun the medical systems (which was the whole point of quarantine).

If you don’t like how your state is handling how they’re reopening, that’s what elections are for. This is unprecedented. I’m glad I’m not an elected official. You’re never going to please everyone - especially on this issue! Be smart! Wash your hands, be active, socially distance when appropriate, wear masks when in public (for yourselves & others).
That's nice your husband is in a location that didn't get hit that hard. I have a different perspective as someone who has been working directly with COVID patients in a location that was a hotspot and it has been a nightmare. There are no days where we have no COVID patients, even now. I do NOT want to go back to another peak. I want to practice my specialty again. We are only just restarting elective surgeries. We still don't know if infected people even have immunity or for how long. We do not need to rush people into crowded locations unnecessarily. People who have been lucky enough to not be in a hotspot don't know how bad this can get. I think my state has been handling things quite well. But the problem is that people travel from state to state, and you cannot control everyone. I agree we should be reopening, slowly, in stages, now. Business and even restaurants that can allow for physical distancing should slowly be reopening over the next month or so. I do not agree that we need to be putting people in crowds at this point. Germany has been doing great, and even they canceled Oktoberfest.
 
I see Disney Springs is opening 5/20, but I still believe that park openings are quite away off. I wonder if it makes fiscal sense for Disney to open the parks while the hotels remain closed? My guess is that unlike the opening of Disney Springs, opening the parks without the resorts for more than a couple of weeks will be a net loss for Disney.

I think Disney has to be very careful of opening the parks and resorts and having to close shortly thereafter, unlike Disney Springs. Can you imagine traveling to Disney only to be told "sorry folks, parks closed" or worse yet, not having a place to stay?
 
I see Disney Springs is opening 5/20, but I still believe that park openings are quite away off. I wonder if it makes fiscal sense for Disney to open the parks while the hotels remain closed? My guess is that unlike the opening of Disney Springs, opening the parks without the resorts for more than a couple of weeks will be a net loss for Disney.

I think Disney has to be very careful of opening the parks and resorts and having to close shortly thereafter, unlike Disney Springs. Can you imagine traveling to Disney only to be told "sorry folks, parks closed" or worse yet, not having a place to stay?
That it's the biggest problem of WDW. All the other Disney parks are more suited for day visits, not necessarily needing an overnight stay. Disney does not want to open the parks and then have people stay at vacation homes or hotel chains that are open.

I can more see WDW following Shanghai's procedure, first open Disney Springs (or equivalent), then resorts, then parks.
Also because in WDW resort-visiting is more a thing, there are people who just go to the resorts without going to the parks, like before a cruise.
 
I'm still curious about Shanghai opening ahead of Hong Kong. I know it was the first park to close, but considering Macau's casinos started reopening in February and Hong Kong is fairly close to Macau (connected by ferry from what I've seen), it surprises me quite a bit. It looks like they may be next in line, but I think the rest is really up in the air. We currently have resort reservations in July and while I would like to go to WDW, I may hold off until February. I'm not opposed to traveling this summer and we still want some kind of summer vacation, but if it is open in July, I'm not sure I want to experience the parks in these early phases. I'm more of an optimist and lean towards them opening sooner rather than later. I'll spare you some of my thoughts on why, but we're all entitled to our opininos. I just don't know how I feel about face masks all day in July. If we rebook for February, masks may still be mandated (assuming they will be in the first place), but a mask in February should be easier to tolerate than in July.
 
I wonder if it makes fiscal sense for Disney to open the parks while the hotels remain closed? My guess is that unlike the opening of Disney Springs, opening the parks without the resorts for more than a couple of weeks will be a net loss for Disney.
I don't see it that way, unless I'm not understanding what you mean by "net loss". Being a recovering bean counter I may be miss-interpreting what you are saying.

If Disney opens the parks, they get revenue coming in. That supports the parks and means less of a loss in that segment. It doesn't do anything about the loss in the resort segment.
 
I don't see it that way, unless I'm not understanding what you mean by "net loss". Being a recovering bean counter I may be miss-interpreting what you are saying.

If Disney opens the parks, they get revenue coming in. That supports the parks and means less of a loss in that segment. It doesn't do anything about the loss in the resort segment.
It costs Disney a lot of money to have the parks open at all. They are paying staff, paying to run the rides, electricity, AC, etc. Then there is the PR risk they are taking. Lots for Disney to consider.
 
I don't see it that way, unless I'm not understanding what you mean by "net loss". Being a recovering bean counter I may be miss-interpreting what you are saying.

If Disney opens the parks, they get revenue coming in. That supports the parks and means less of a loss in that segment. It doesn't do anything about the loss in the resort segment.

My premise is that the parks at diminished capacity with tighter restrictions could have operational costs that exceed their revenue, and it's possible that they would need the resorts to be open in order to recoup those losses. On scenario I was thinking of in particular is the parks being primarily filled with FL residents/pass holders and how that would affect their revenue.
 
I've been observing the Covid model projections, and it confounds me that there is such jubilance with regards to opening the Florida parks compared with China. From the surface, it appears that China and other countries took far more aggressive quarantine measures and for longer periods of time. There seems to be an aggressive stance to open up Florida to an unnatural degree - it’s like a powder keg.

When there was the news about the financial analyst predicting the parks not opening till 2021, I scoffed. But now I get it, and I’m drinking the kool-aid. It has to make sense from a liability standpoint. There’s some bizarre tug of war going on between safety and economy, and I want no part of it. I get it, there are Disney fans, and people who make their livelihood on selling the dream - bloggers, travel agents, or YouTubers, but at some point I have to be a realist and step back.

Is this the Disney I want, that I grew up with, that I enjoyed? Or am I just doing it to go through the motions of doing “Disney”. Put on the mask, stay away, play the part and pretend like you enjoy it? This re-opening feels icky.

I’m trying to do a family vacation for Thanksgiving, but I feel that date is looking too early.

Well said! Agreed wholeheartedly. We are happy (and safe) waiting until February 2022!
 
It costs Disney a lot of money to have the parks open at all. They are paying staff, paying to run the rides, electricity, AC, etc. Then there is the PR risk they are taking. Lots for Disney to consider.
My premise is that the parks at diminished capacity with tighter restrictions could have operational costs that exceed their revenue, and it's possible that they would need the resorts to be open in order to recoup those losses. On scenario I was thinking of in particular is the parks being primarily filled with FL residents/pass holders and how that would affect their revenue.
Thanks to both for your explanations. I understand you points. However, I disagree. (surprised?)

CM's to run the rides at a reduced capacity may be offset by higher cleaning costs. I'll agree with that. And the CM salaries are indeed incremental, other than whatever base staffing they have on hand anyway. But CM levels overall should be lower because of reduced base levels. For example, instead of enough CM's to man 20 tap styles, they may only need to open 5 of them. Or they may need only 10 bus drivers, not 40. That kind of thing.

Higher costs for electricity and environmental (AC, etc) is certainly incremental. I'll agree with that. I just don't think its a big enough component of the total cost to run the parks.

What Disney is facing is a large amount of "sunk costs" or perhaps better named "fixed costs" that they are incurring no matter if the parks are open or temporarily closed. Against that is theme park admission (revenue) is abut 25% of total revenues from parks, experiences and products (Disney's segment terminology). Resort revenues would be another ~25%. There is also a big revenue stream from merchandise, food & beverage, accounting for 15-20% of the total revenue. So, while the revenues may be lower that doesn't necessarily mean that they would operate at a loss with reduced attendance.

Sorry if I've made your eyes glaze over. As I noted above I'm a recovering bean counter.
 
Thanks to both for your explanations. I understand you points. However, I disagree. (surprised?)

CM's to run the rides at a reduced capacity may be offset by higher cleaning costs. I'll agree with that. And the CM salaries are indeed incremental, other than whatever base staffing they have on hand anyway. But CM levels overall should be lower because of reduced base levels. For example, instead of enough CM's to man 20 tap styles, they may only need to open 5 of them. Or they may need only 10 bus drivers, not 40. That kind of thing.

Higher costs for electricity and environmental (AC, etc) is certainly incremental. I'll agree with that. I just don't think its a big enough component of the total cost to run the parks.

What Disney is facing is a large amount of "sunk costs" or perhaps better named "fixed costs" that they are incurring no matter if the parks are open or temporarily closed. Against that is theme park admission (revenue) is abut 25% of total revenues from parks, experiences and products (Disney's segment terminology). Resort revenues would be another ~25%. There is also a big revenue stream from merchandise, food & beverage, accounting for 15-20% of the total revenue. So, while the revenues may be lower that doesn't necessarily mean that they would operate at a loss with reduced attendance.

Sorry if I've made your eyes glaze over. As I noted above I'm a recovering bean counter.
I love this stuff so don't apologize. I think they will soon find out based on Shanghai whether people are buying as much merchandise per guest post-COVID or whether they are more likely to stay out of stores. Food is revenue, but the costs will be higher than pre-pandemic. Wholesale prices for various foods are more expensive, especially meat, so they will have to roll those costs in (and while they can increase prices somewhat, there will be a lot more people watching them - namely future guests deciding if it's worth it to come - compared to normal times so they have to be careful). They also might not make as much because their TS restaurants may either be closed or working at very reduced capacity. I actually think they won't reduce staff that much because they have to use more staff for cleaning, crowd control, and crowd management. Your example about the tapstiles is an interesting one. One would think with 25% of the people they would need 25% of the CMs at tapstiles. But pre-covid it was possible to have a line at each tapstile. Now they need to spread people out and that can be best accomplished by opening all the tapstiles. I think there is just so much more that needs to be added in beyond just the usual costs to run the parks. I think they will still open even if they have to run at a loss for a while because they simply cannnot avoid safety protocols and phased openings.

One area MK can basically mint money is by selling alcohol at QS and carts. I know lots of people on here hate that idea but I would not be surprised if this is what really ends the semi-dry policy for good, especially since the TS restaurants won't be open much. It will be very interesting to see what happens.
 
No Apologies necessary - I'm enjoying this conversation, and appreciate the other points of view.

I watched the show yesterday and see that Pete remains bullish on a 6/1 open. I think Pete may have been understating the amount of June reservations as I assume it would include both those who rebooked as well as all of those people who booked June in advance. I think it's becoming incumbent on Disney to start giving some guidance one way or another on its' plans for June.

One thing Pete said that rang true is that if they open, they will limit it to those that have already booked. This is why I'm still hanging on to my July Disneyland reservation, because our stay is booked at the Disneyland hotel. My biggest concern if they do open in time for my trip is air travel, as we would be flying across the country with 2 kids.
 
I doubt they will open in June but only time will tell. I have wondered if 25% capacity would be worth it for them. I think they are testing with DS and will make decisions based on that outcome. I also think they might open hotels before the parks, less touchpoints and easier to control.
 
Just wanted to add that even if 25% capacity doesn't let them actually earn a profit, it still provides a valuable learning experience. They can see what works and what doesn't so they can make adjustments for the next phase.
 

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