Euro Disneyland has not turned a profit in 20 years

[Reanimated35]

Also a rich dude spends 15mil euro in 3 days at the park.

A SAUDI prince has spent 15 million euros ($A20.41 million) for three days of fun at Disneyland near Paris to celebrate his degree, the group that runs the theme park says.

Prince Fahd al-Saud booked entire areas of the park between May 22 and 24 for his 60-odd guests. The festivities included tailor-made events involving "rare Disney characters", Euro Disney said..

Special security was put in place for the prince, one of the park's top customers, it added.

The theme park attracted 16 million visitors last year but Euro Disney has not made any profits since it was set up 20 years ago.

In the six months to March, the group had a net loss of 89.1 million euros compared with a loss of 11.8 million euros in the same period last year.

Read more: http://www.news.com.au/travel/news/saudi-prince-spends-15mn-euros-at-disney/story-e6frfq80-1226656559511#ixzz2VAFWS0Nk

[Wazza1]

The biggest problem is that when they built it they borrwed a lot of money. ALOT! The holding company which runs Disneyland Paris (only 40% owned by Disney) currently owes around 1.9bn Euros. The yearly interest payments alone on this amount really adds up.

They make a modest operating profit most years, (I was told they made around 12 million Euros in 2010) but because they are struggling to pay off their 1.9bn euro loan the interest charges alone send them well into the red financially every year. Hence the 89.1 million euro net loss in the six months to March quoted in the article.

[Reanimated35]

I just don't understand how they feel it's still viable to keep the park running though?

[colliric_855]

I just don't understand how they feel it's still viable to keep the park running though?

Does the park bring in any significant extra tourism cash into the French economy? 16 million visitors is pretty hefty. Edited June 3, 2013 by colliric_855

[Reanimated35]

Has anyone been there? How's the park compare with the Californian one? (I'm not looking for assumptions, I can make those on my own, I mean people who have actually visited the park)

[Wazza1]

I have been there many times (last time there was about 3 weeks ago) and I know I few people who work there. First of all if you want a comparison between it and California, I would say it's 'Disneyland Lite'. They take most of the bits and pieces that make Disneyland, Disneyland (but not everything) then distill it down into an essence and inject it into the Paris countryside.(I guess you could call it a Disney franchise) A lot of the rides and theming are the same (if not better like Space Mountain Mission 2) but there is a certain something missing which is difficult to put your finger on. Some of that is the relative apathy on display by ride operators and other workers there, (especially when compared to California) and some of it is the simple fact that not everything was ported over from California. (Have a look at a park map of the two and you will see what didn't make it) If you have never been to Disneyland California, then you'll probably think Disneyland Paris is awesome, but if you have been to the original, then you will think the Paris one is a slightly poor imitation. But it's still definitely worth a visit, and is actually pretty cool, but only in comparison to California does it look a bit weak. Disneyland Paris does suffer from a ridiculously overburdened beauracracy in the way the business is structured (which is the problem with a lot of French companies) and a relative amount of inflexibility with regards to undertaking massive cost cutting to make the business more efficient and streamlined. This last point is a combination of French culture (resistance to change) as well as French labour laws (which make it difficult to fire or re-allocate staff) Unions are pretty strong in France, and I know there have been ongoing wage and conditions issues with workers at Disneyland Paris. Lastly, Disneyland Paris has ridiculously high rates of staff turnover, which is extremely costly for any business and this doesn't help their bottom line either.

[JacobSibbald]

Well I'm going in just over two weeks (saturday 22nd) and possibly the day after and by the looks of it, off watching the videos from AJRucks and the like, it does look a bit lacklustre compared to Disneyland and DCA. I'll be sure to post my review when I get back, although I don't know if you want the opinions of a 16-year-old (I've been to Disneyland Anaheim by the way)

[mba2012]

I've been to Euro Disneyland. It's the only Disneyland I've been to so this may not be too accurate, but I found it an amazing place. It had this distinct atmosphere to it, one that was very different to all the areas surrounding, and the park seemed very full. And also, a place like Paris would be very good for a Disneyland like park IMO.

[Jobe]

Jacob why wouldn't we want to hear your opinion?? It's just as valid as anyone else's on this forum!! I went to Disneyland Paris 8 years ago- I enjoyed it but it just felt too sterile for mine. Don't get me wrong- I enjoyed the day immensely- Space Mountain and Big Thunder Railroad are quality coasters!! The overall park was as you would expect from Disney- excellent theming and an overall great experience!! Mind you this is the only Disney I have been to so I cannot compare. Interestingly , on this trip I also visited Blackpool Pleasure Beach and this visit holds the fonder memories for me. The Pleasure Beach had that old world atmosphere and historical aspect to it that really appealed to me. It reminded me a lot of what both Luna Parks here make me feel, of course on a much smaller scale. Of course the Pleasure Beach could not compete with Disneyland Paris for theming but the different vibe the park gave just connected more strongly with me. Plus the Pleasure Beach has some great attractions also and the historical coasters are top notch. Either way you will have a great time- enjoy yourself!!

Edited June 4, 2013 by Jobe

[JacobSibbald]

Jacob why wouldn't we want to hear your opinion?? It's just as valid as anyone else's on this forum!!

Thanks Jobe I'll be definitely sure to give you one then. And hopefully (it's about 50/50 at this stage) I can get to Alton towers for the smiler or Thorpe Park for The Swarm. I'll also be going to PortAventura in Spain and Aquaventure in Dubai.

[filament]

The whole thing about "Disneyland Paris never did profit" is technically true, but that's really not so simple...

As explained in a previous post I'm french and my english is really not perfect, so I'll try to explain the whole thing, hope it will be clear enough. If not please ask me for some details.

To understand what happen in our main park (as main park in France, and in Europe, by far) you have to know french recent history and Walt Disney Company history.

When Disneyland Anaheim turned to be a really profitable place for the company, the idea to go out of the country seemed to be not a bad one. But some China low copy of the park really pissed of boards and in particular Walt Disney. Then they said they will never go out of the country.

After that they build WDW, we all know how big and successful this is now.

We all know how Japan became one of the richest country in the world by pushing hard people to work. Everything as a limit so the country decided that they really need some short vacations destinations. They had some ideas, and one of them was a polder in Tokyo Bay with parks on it, including Disney.

After lot of discussions Walt Disney Company finally said "hey yes, why not, but not our problem", and the owner of the park is a semi public company. When Disney only make small profits from the franchise and don't have choice on what to put in the park (well, say just "limited") even if everything is "Imagineering made".

Then Tokyo Disneyland turned to be the most profitable park in the world (no idea if it's still the case). What a mistake for the WDC !

So proof that Disney parks can work out of America was made, there was not so much rich part in the world with lot of inhabitants. Next step was of course Europe.

During this time France had his own troubles and success. The main trouble was that Paris was growing to be a city with everyone living in small flats and big old building were constructed everywhere in suburbs, which obviously was not nice : over populated, no green place (parks, water fountain...). Government decided to create what they call "New City" (Ville Nouvelle in french) to improve conditions of living for people. There was 5 of them, two of them are knowned outside of the country : Saint Quentin en Yvelines cause it's near Versailles (the famous french king castle, if you don't know google it, it worse it), and Marne la Vallée, now knowned for Disney.

But Marne la Vallée was not really working, no one was going there and no company created new offices there. It needed : new public transportation to Paris (like suburbs trains, king of an extended subway), international connections without going to Paris (high speed train, we use it a log in France, and now Europe), and highway connections.

Cost a lot !

So the idea was here after lot of discussions : Disney will come near Paris, they will have their park in Europe, and Paris will have his "New City" successful cause of the number of employees by Disney and by hotels / restaurants, etc... And cause of the taxes on companies.

France did for free to Disney the trains connection (it's now on of the biggest hub in Europe, linked directly to Paris, London, Bruxelles by high speed trains), the suburbs transportation, the highway. And had now a new way to keep Paris the most visited city in the world, which is of course a main revenue for the country.

And Disney had lot of advantages : lands for nothing, money advanced by french banks,, no construction about roads and transportation, etc...

They said they wanted to go in Spain of French, this was just bullshit to win the best offer from France. At this time it was not a question : Spain was not a really rich country and France was (funny how things change in 25 years), Paris was in the center of the western Europe, Barcelona is at the dead end...

To give you ideas of what I mean by "best offer", moreover that free infrastructure Disney is the only authorized architect for a part of the city (city, not park related, just normal people living here), they have a huge amount of waste ground in option (1947 ha !). It means that now it's not owned by Disney, they didn't have to pay for it cause it's not owned by them. But no one can use it / build on it, cause it's booked for Disney. They have some maximum date for each park of the ground until when this arrangement will end, so they have to use it or lose it one day or another. But the best point is : if they want to use it, they will pay it at the price of 1987 (date of the convention with the french government) and they can do what they want with it. So they can build new parks, accommodation or whatever or... they can sell it. Sell it with the price of today of course. And believe me prices in Paris have really changed since 1987 (if I believe wikipedia it has been multiplied by 4, so as Marne la Vallée was just a landscape and his now a big rich city, I'll let you imagine).

Oh last but not the least they had some low taxes exception on parks entry tickets !

But Walt Disney Company is a really good money maker company, so they didn't the same error than in Japan, but didn't want to take some risk of an outside of America company.

So Euro Disney SCA (ED SCA) is the company, this is a french company, which is owned at 40% per the Walt Disney Company (WDC). WDC is also the manager of the company, ED SCA has to pay them for this. WDC is also the only provider for new attractions, parks, hotels, concepts everything : ED SCA has to pay them for it. WDC is also the owner of the "Disney" trademark and so for every ride made, so to use the name and attraction created by Disney ED SCA has to pay for it. When merchandising with name or image of Disney is sold ED SCA has to pay for it. And if one day, by accident, they turn profitable they will have to give a part of it to WDC.

So yeah WDC didn't take any risk, but no troubles if Euro Disney turned to be profitable.

There was no risks cause there was so much money used to build that they have to pay a lot per year in interest and refund of banks (WDC since previous year by the way), they have to refresh parks and hotels and everything.

So at the end here is the situation :

- Euro Disney SCA lost a lot of money

- France win a lot of money cause it's still the most visited country in the world, and Disneyland Paris really help for it. Example : 15.8 millions guest per year in Disneyland Paris, 8 millions in Louvre (where you can see the Joconde)

- Walt Disney Company makes a lot of money with the park royalties and other things.

So isn't the company profitable ? No it's not.

Does it mean that the whole thing is not profitable ? No ! It's useful for the whole economy in France and WDC

So should Disneyland Paris close cause of money troubles ? Hell no !

There is lot of books dedicated to the subject, but I'm afraid they are all in french.

Again pardon my english.

If you need some sources, documents, just ask, I can provide (when the Euro Disney SCA corporate website will be back online).

[mba2012]

Thanks filament! Its great when a member from overseas joins! There actually a lot that I didn't know there. Great info!

[DaptoFunlandGuy]

Filament - thankyou for the analysis - it's good to get a local's point of view on the issue.

Nevermind the language - it was still a lot easier to read than some modern teens we get on here (calm down everyone - I said SOME)

Again - much appreciated.

[rappa]

I'll second all that. That's a really great run down of why the park may look a failure on paper, further analysis shows it does make a lot of money.

[filament]

Hi guys, I just thought about you reading this article from a friend of mine. Since this economical story about Euro Disney and the major difference in quality seems to interest you, and cause this is one of the only blog in english from a french speaker, maybe you could have some interest reading it : http://www.leparcorama.com/2013/07/14/the-increasingly-bad-state-of-disneyland-paris-a-neverending-story/ I would not be so negative by my own, but he is quite true I think. Will be ready to talk about this if you would love to.

Edited July 18, 2013 by filament