Economic impacts on the industry?

[Jonesta6]

The intent is to discuss possible realities for the industry due to changing market conditions driven by US federal policies including tariffs, proposed legislation, and Supreme Court rulings, as well as the ever-increasing consolidation of wealth. There is no intent to discuss politics or tangential social topics as there are other threads for that purpose.

That written:

Where do you see things heading?

In general, I see everything getting far more expensive.

But specifically, I'm wondering if we're going to see the pressures of needing to generate continuous profit colliding with raw material resource cost increases, labor shortages, reduced revenues as people cannot afford to visit, and other factors exacerbated by the new administration will result in the complete death of the theme park industry (including theme parks, amusement parks, and industry-specific partners such as manufacturers) as we know it, or are we going to see the industry become increasingly innovative at attempting to solve such challenges?

 

[Bring Back Questor 87]

Predictions to circle back to one year from now:

Coaster prices increase due to raw material price increases, labor issues, and slimmer profit margins for specific corners of the industry.
Costs will be passed onto guests.
Things like parking, food, and other goods like souvenirs from China increase.
GP will play along this summer, but by Fall, the pain comes in and visit numbers decrease for holidays.
Parks will have a mixed year, and blame tariffs, lack of skilled labor, and VISA issues.
Parks then try to do a "more with less" campaign, but enthusiasts notice the most.

New coasters will help to a degree with proper advertising, but in general parks will need to work on "experiences" more than anything. I do believe the major denominator will be labor and costs forced back onto the guest, even though many of these chains have the funds to deal with changing times by not overpaying top execs and looking at expenses in a holistic manner.

Theme parks are going into strange territory, some may not make it. Those who do? Listen to the customer and think seasons ahead, as if you *won't* do well the summer after this one coming. Fittest, survive...

 

[Jonesta6]

Where I'm a bit stuck is that we just saw two large rivals merge to, as they put it, survive under not-ideal but improving economic conditions. There's only so many more of those kinds of tactics to go around before antitrust regulation (assuming any remains) prevents it.

When the family of 4 can barely afford basic necessities, a season pass may be a luxury. Even if families continue purchasing them using the membership model for low monthly payments, that's not likely going to cover the overhead itself without in-park spending. This was already a problem in the industry if I understand correctly, why things like meal deals and merch promotions/photo memberships exist.

As an investor, it seems unprofitable to continue investing in such an enterprise, especially as these companies have high debt loads already.

So... What keeps the gates open, prices reasonable, and guests and investors happy?

 

[GAcoaster]

The US parks will see another year of scarce labor without the H1B visas to bring in foreign workers for summer.

If tariffs go into place just about all merchandise gets marked up even further than it already is to offset costs from overseas vendors.

Food costs go up more between tariffs on imported produce and shortage of workers in farms.

 

[BlackWeird]

The next few years are definitely gonna suck. I wonder if in Six Flag’s case, they’ll cannibalize some of the under-performing parks and send their rides to their larger parks in lieu of new large-scale attractions.

If Six Flags America closes, I wouldn’t mind Joker’s Jinx winding up at Carowinds

 

[Jonesta6]

The next few years are definitely gonna suck. I wonder if in Six Flag’s case, they’ll cannibalize some of the under-performing parks and send their rides to their larger parks in lieu of new large-scale attractions.

If Six Flags America closes, I wouldn’t mind Joker’s Jinx winding up at Carowinds

So basically bring back the ride rotation program?

 

[bill s]

Local and regional parks are among the best entertainment values. Their popularity should therefore be less affected than most.

 

[Fenrihr]

Prices will definitely go up, IMO.
TBH, the season long food/drink/pass is a hell of a deal, if you can make use of it often.
Your local park is probably best value for time, outside of some video games.

 

[horsesboy]

My understanding is Legoland Florida just recently made significant layoffs in their entertainment division my guess is that we will sadly see more of this happening industry wide over the course of the year.

 

[The Master]

The industry and the economy as a whole will downsize everything except prices and disappointment.

 

[guy305]

The industry will be rewarded if Epic Universe is a breakaway success. It adds 14,000 jobs and came with state-funded infrastructure improvements. Federal government is already throwing billions of dollars at private companies in the name of generating jobs. If that's the vibe going forward the next few years, I can see state governments trying to stimulate their economies at a smaller scale, and looking at Epic's success for motivation.

 

[Jonesta6]

The industry will be rewarded if Epic Universe is a breakaway success. It adds 14,000 jobs and came with state-funded infrastructure improvements. Federal government is already throwing billions of dollars at private companies in the name of generating jobs. If that's the vibe going forward the next few years, I can see state governments trying to stimulate their economies at a smaller scale, and looking at Epic's success for motivation.

I'm not sure the current federal administration is planning on shelling out funding to any private company unless that company is led by one of the puppet-masters that paid to play.

The recent news about cutting funding to practically anything directly useful to citizens doesn't bode well for either parks obtaining federal funds for anything, or guests continuing to afford to visit if the prices aren't reasonable... Which unless something happens, and soon, my guess is increasingly more people are going to be worried about food, housing, and medical care over entertainment.

 

[guy305]

I'm not sure the current federal administration is planning on shelling out funding to any private company unless that company is led by one of the puppet-masters that paid to play.

The recent news about cutting funding to practically anything directly useful to citizens doesn't bode well for either parks obtaining federal funds for anything, or guests continuing to afford to visit if the prices aren't reasonable... Which unless something happens, and soon, my guess is increasingly more people are going to be worried about food, housing, and medical care over entertainment.

I can see a governor like Youngkin issuing bonds to Kings Dominion after seeing Orlando explode, bundle park expansion with highway infrastructure improvements, and then it be a colossal waste of money that doesn't generate anything but debt for Six Flags lol. Hell citizens not wanting to spend money could be a reason for trying to stimulate it in the first place. I'm just saying that if Epic is some insane success story, politicians might get gung-ho to "do the same thing DeSantis did", even if it's not a good idea.

 

[Jonesta6]

I can see a governor like Youngkin issuing bonds to Kings Dominion after seeing Orlando explode, bundle park expansion with highway infrastructure improvements, and then it be a colossal waste of money that doesn't generate anything but debt for Six Flags lol. Hell citizens not wanting to spend money could be a reason for trying to stimulate it in the first place. I'm just saying that if Epic is some insane success story, politicians might get gung-ho to "do the same thing DeSantis did", even if it's not a good idea.

I don't see that happening at all - unless he's going to profit on it once he's out of power or it's a favor for an ally, he's not interested as far as I can tell.

But let's say he tries - that budget would have to be approved by the General Assessbly, which may require legislative wrangling past his reign in office. That's before dealing with any other related issues, such as if the same bill needs to be passed twice in both chambers of the General Assessbly on successive sessions (such as the bills to allow recreational consumption of marijuana without creating a regulated marketplace).

 

[mtorange]

My understanding is Legoland Florida just recently made significant layoffs in their entertainment division my guess is that we will sadly see more of this happening industry wide over the course of the year.

I needed to post this somewhere. RWS is now hosting auditions for this season after the parent company laid off more than 200 performers. Supposedly RWS will be paying the performers significantly less than what Legoland paid the original performers. People are (rightfully) shitting on them for this practice. The reception on Facebook has been BRUTAL.

 

[netdvn]

So Universal is dropping 14 day unlimited admission to Epic Universe (and the other 3 Uni parks) in January. They're definitely anticipating economic troubles in the coming months. Orlando gets a good chunk of its visitors from foreign countries like Canada and the UK. As people cancel their trips, expect these destinations to take a big hit.

Tariffs will definitely deal some damage to the industry as well. If the economy continues the way it is, I can definitely see parks struggling in the next couple years.

If Uni is really giving away the gate this soon after opening, I could definitely see them adding Epic to APs sooner rather than later.

 

[GAcoaster]

So Universal is dropping 14 day unlimited admission to Epic Universe (and the other 3 Uni parks) in January. They're definitely anticipating economic troubles in the coming months. Orlando gets a good chunk of its visitors from foreign countries like Canada and the UK. As people cancel their trips, expect these destinations to take a big hit.

Tariffs will definitely deal some damage to the industry as well. If the economy continues the way it is, I can definitely see parks struggling in the next couple years.

If Uni is really giving away the gate this soon after opening, I could definitely see them adding Epic to APs sooner rather than later.

That’s more a case of trying to bolster attendance at the existing parks with Epic opening— if everyone just goes to Epic, the other two (three) parks take big attendance hits. All those ticket packages only offer one day of Epic.

 

[netdvn]

That’s more a case of trying to bolster attendance at the existing parks with Epic opening— if everyone just goes to Epic, the other two (three) parks take big attendance hits. All those ticket packages only offer one day of Epic.

Actually the UK is already able to book a 14 day unlimited ticket that includes unlimited visits to Epic Universe starting January 1 next year.

https://www.reddit.com/r/UniversalOrlando/s/BRfqTtOLuD

 

[GAcoaster]

Brace for more cost cutting—

 

[warfelg]