Euro Disney losses continue to get worse

Posted | Contributed by Jeff

French theme park operator Euro Disney, which announced a life-saving debt restructuring in September, fell deeper into losses in its 2003/04 fiscal year due to royalty payments and increased operating costs. The company said it made a net loss of 145.2 million euros in the full year to the end of September, after a 56-million loss a year earlier.

Read more from Reuters.

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Disney is just not big enough over here. If it was to be placed in Europe... the perhaps areas where attendence would be biggest may be in Holland or Germany. But only because these cultures tend to be more disney lovin theme park going places. UK maybe but people will not fly or train across countries to go to it unlike the states...
I'm sure one of Disney's considerations is that France has more international tourism than any other country. Still, if I were putting it in France, I'd have put it down south near the Mediterranean to get a better climate.

On the other hand, climate is what attraced Port Aventura, Terra Mitica, and Warner to Spain, and last I heard, at least two of them were in financial difficulty.

Okay... Disney owns a part of DLP but not the entire thing. Is this similar to the Japanese parks and the Oriental Land Company (or whatever the name happenes to be)? Or does the Oriental Land Company own the parks entirely and just pay Disney some kind of licensing fee?
So if the park does happen to close, does Disney have the rights to move those attractions to other parks or perhaps a new park? The reason I ask is because they are just the majority owner, but not the sole owner of the park. I say they learned their lesson, now move the park to a more friendly American-friendly country. I still say the reason that France has snubbed this park is because it is too cliche American. They don't like us, even though they are trying really hard right now to get us to come back and be tourists there in France as they have lost billions of tourist dollars by not supporting our Middle East efforts, end of story.

The one thing I don't get is why they built studios there when the original park was having so much trouble. That is just not smart business practice there.

-Swooshie

I could be totally off base here, but maybe there was a second park "promised" when the first park was built? I recall SF being obligated to invest a specified amount of money in Jazzland when they purchased it and turned it into SFNO... could Disney have been obligated to make certain investments as a concession for being allowed to build DLP in France? If so, maybe one of those concessions was another theme park gate. That would explain why the park wound up more or less "half built".
"The one thing I don't get is why they built studios there when the original park was having so much trouble. That is just not smart business practice there."

Because they were desperately trying to fill the thousands of hotel rooms that were sitting there empty.

There probably isn't one factor that's been the killer with Paris, but a combination:

1) Way too many hotel rooms
2) The whole France thing (location/weather/attitude)
3) Too much money building DLP
4) Not enough money building the Studios

Joel

It had 12 million visitors and was making profit !

Then they built the Walt Disney Studios. :-(

Rob,
OLC owns 100% of the Japanese parks. They pay Disney a yearly licensing fee for the Disney name, characters, etc. When they build a new ride they pay imagineering HUGE sums of cash, which is why Tokyo Disney Sea got innovative new ride experiences. Disney employees do not directly Disney oversee the operation of the parks. Disney also owns a portion of DLP, but still receive huge licensing fees, and Disney employees DO control operations (Jay Rasulo, Paul Pressler's replacement, came from running the Paris operation).

IMHO, if the park is to avoid complete closure Disney MUST cut at least part, if not all of their licensing fees. The answer, as DCA proved, is not just building another cut rate Tower of Terror.

here's a (currently) working link to the article
http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=6756156

Here's a quote about royalties

"That was partly due to the resumption of royalty payments to 39-percent shareholder the Walt Disney Co (DIS.N: Quote, Profile, Research) for use of the Mickey Mouse characters. Those payments resumed over the last three quarters of 2003."

I believe it's better for Disney to not make any money off of royalties for a while than to see Creditors call in their debts. It sounds like that's what had happened before, and it needs to happen again.

FWIW, Parc Asterix was based on a beloved French character, and on top of that is more appealing to thrillseekers with its nice array of coasters. I'd atribute those two things to its success over DLP.

It was cheaper to build it in france, but the french people's reputation for arrogance and annoyance stops a lot of people from going, including myself. What's the point of travelling thousands of miles to a park where you're not really wanted?

If that's your attitude, I wouldn't want you there either.

All of these comments on the French people and their "anti-American" sentiments are ridiculous. I'd be willing to bet that most, if not all, of the people here claiming the French are so arrogant have never been to France. The reason for any anti-American views over there directly stems from the anti-French views here. I visited France in March of this year, directly in the midst of this "feud" that has been going on between France and the US. I experienced absolutely *no* disrespect, arrogance, or bad feelings against me for being an American. I didn't go in there like a stupid American tourist, however, and refuse to try to speak the language or respect the culture. The bottom line is I've heard a hundred times the disrespect and arrogance here in the US against France than in France against the US.

That said, it's obvious why the park was built outside of Paris. Paris is the number one tourist destination in the *world*. Does the reasoning behind that really need to be explained? Additionally, contrary to what was said above, Disney films have done better in Europe than in the United States. Also contrary to the above, the two final choices were France and Spain (not the UK). Spain had the better weather, but France had the tourism and the public transportation system in place.

The resort has had problems for two reasons. First, when it first opened the park was completely oblivious to French culture. DLP didn't serve alcohol, traditional French food, and lacked the sit-down restaurants the French people desired. It was essentially complete cultural ignorance on the part of Disney that harmed the park during its first year of operation. Yes, there was already some ill feelings toward the park due to fears of cultural imperialism, but obviously ignoring the culture wasn't the way to win these people over. Thankfully, Disney got smart and resolved most of these cultural issues (including the renaming of the park).

Problem number two is the Studios Park. All of the bad things you've heard are true. It's absolutely tiny, it's ugly, and there's nothing to do. When we visited DLP, we paid just €10 to upgrade our DLP tickets to include the Studios Park. We literally walked into the Studios Park, rode RnRC three times with zero wait (while Space Mountain at DLP had a more than 90-minute wait), experienced the joke that is Armageddon, rode the Aladdin-themed Dumbo, and left. Total, we spent maybe half an hour in the park, saw the entire thing, and did everything but the tours. This is not even a half-day park (and ToT alone will not fix that). In addition, the whole thing is a concrete and blacktop mess with little to no landscaping, no trees, and chain-link fences.

In order to turn the Disneyland Parks resort around, it needs to be invested in (mainly in the Studios Park). I don't think they're eager to do that, however, which is unfortunate because I really did enjoy DLP.

-Nate
*** This post was edited by coasterdude318 11/9/2004 2:42:31 PM ***

^ You are absolutely right. The whole anti-US cliche is really missing the point. DLP has 12 million visitors a year (despite a cold winter). Having financial problems with this amount of visitors is a problem which is far greater than unsurmountable preoccupations.

Over here in Germany, the park has the image of being an expensive kiddie park. Image campaigns failed to impress families enough to spend a small fortune to go to DLP while there are countless cheap family parks around the corner.

Add to this that Disney is not even attempting to promote the Studios and most people are clueless (and upset) when they find out that there is a second park next doors, which actually turns out to be a complete rip-off.

There were no additions and new attractions made to the main park in ages and a second gate was certainly not what the people asked for.

People who really believe that the staff is arrogant because they have been told that its the "french way" should pack their bags and experience one of the nicest parks on the planet, or rent a trailer next to Fantasy Island (Skegness) for the rest of their lives.

All I have to say is this "I already knew disney would start this and it failed. They are losing money for no reason."

If they keep doing this why dont they just move the whole company out there. I dont like disney alot anyway. Espically not their parks.

I like hillary duff though :)

Mamoosh's avatar
i have been to France...all over the country actually. granted, it was back in 2000, but i have to disagree, and say that the French do have a "thing" against the American point of view. i did get treated disrespectfully a few times...including when i was pickpocketed in Paris, and the police really didnt do anything to help me. although, ironically, i found France to much like the East Coast of the US.....in that when i was in the south of France,like Bordeux and Marsellies, the people were much friendlier, and much more laid back than up north in Paris and Lille. but anyway....my two cents
I don't think Disney will ever let it close all together. I could see them closing the studio park or perhaps making them one park. But pulling out of the whole market? No. Not Disney. That would be admitting defeat, and a mistake which is something they never do. It would be a corporate embarrassment. They won't let that happen.
coasterdude - i was exaggerating to make a point, apologies if it came across wrong!

A lot of people will not travel to somewhere where there feel unwelcome (the in-laws, etc), and despite the promise of a great family outing, the people who work at DLP, in the most part (there are exceptions), seem to be unwelcoming and only there to earn their money, and take very little pride in their work, which rubs off on the whole atmosphere. And let's face it, atmosphere is what disney is all about! I went there, and i do still go there, but i only return again and again because i can ignore the staff's attitude. After going to Thorpe Park on the wettest day of the season, you very quickly learn to adjust to a bad attitude staff!!!!

I agree that Disney should reduce/cut the licensing out for a bit so the park can build it's reputation back up and get some more visitors and attractions in - they need it!

Disney quite often fail to realise it's better to take a hit on their profits to make sure their good name is kept high - a disney theme park without the disney experience of atmosphere and tons of attractions (even the smaller ones), is no disney park at all. If they can develop a bit more, it will be an interesting couple of years to watch what happens.

I could see Disney moving the rides out of the studio to MGM, DCA, or another park that do not have the rides already. As for Disneyland part of the park I have no Idea what they would do other than moving it to South Korea park.*** This post was edited by Vortex 11/10/2004 12:10:28 PM ***
Vortex,
That would be pretty cheap, too, as there's only one ride there anyway.
"including when i was pickpocketed in Paris, and the police really didnt do anything to help me"

When it comes to that sort of petty theft, there's not much anyone could do. I assure you police anywhere in the world won't do anything to help you if you're robbed. Seriously, if that's the best reason you've got to dislike France then maybe you're trying too hard.

I really think Americans are taking too much credit for this park's downfall. You're kidding if you think that the whole France-America hate thing that's constantly going has anything really to do with these financial problems.

I for one don't think the france-america thing is what is causing this park's downfall, but I will tell you there is a problem with the way americans are treated in France, because I have been there and will never go back. I was there for a week and was repeatedly treated like crap. One of the major things that stuck out was when I was in a store and tried to pay for a soda with 20 euros and the guy behind the counter refused to take it because he said " I'm tired of you americans always wanting to pay with big bills. You americans think you're all rich, well I refuse to take your money. Leave." After that,. it was all downhill from there and I couldn't wait to get out of the country and I can tell you, DLP or not, me or the group of friends I went with never have a desire to go back to Paris or France ever again, and I'm sure there are lots of other people with the same experience. I'm from the Tampa/Orlando area, and our theme park personel or the people of this area would never treat french people or anyone from somewhere else that way no matter what was going on.

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