Disney World sets reopening date

Disney World will reopen its gates, ending a mul...

Posted: May 27, 2020 2:48 PM

Disney World will reopen its gates, ending a multi-month closure of the park that left the Walt Disney Company reeling.

The Disney theme park, which employs some 70,000 people, plans to begin a phased reopening on July 11 for its Magic Kingdom and Animal Kingdom parks and July 15 for EPCOT and Hollywood Studios, the company said on Wednesday.

Walt Disney World as well as Disney's Disneyland resort in Anaheim, California, closed in mid-March because of the coronavirus pandemic.

Disney is implementing several measures to reopen safely and prevent the spread of the coronavirus at its parks

  • Employees and guests will be required to wear face coverings and undergo temperature screenings before entering the parks.
  • Disney will reduce capacity at the parks and the resort will temporarily suspend parades, fireworks and other events that create crowds
  • The resort will also enable cashless transactions by expanding contactless payments.
  • Disney will also increase the number of available hand-sanitizing stations.

The plan was approved Wednesday morning by the Orange County government. It still needs approval from Orange County's mayor and Florida Governor Ron DeSantis.

All of Disney's 12 parks in North America, Asia and Europe closed because of the outbreak at different points this year. Shanghai Disneyland, the company's largest international park, reopened its gates on May 11 after being closed since January 24.

Disney World's Magic Kingdom, which houses trademark attractions like Cinderella's Castle and Space Mountain, is the world's most-visited theme park, accounting for more than 20 million visitors in 2018, according to a report by AECOM. Disney has invested billions of dollars in its theme park business, opening Star Wars-themed lands in Florida and California last year and building new rides like "Mickey and Minnie's Runaway Railway."

Reopening Disney World is a significant cultural and business endeavor for the company. Disney generated more than $26 billion in sales at its Parks, Experiences and Products unit in fiscal 2019, representing 37% of the company's overall revenue.

But the company revealed in its latest earnings report that its Parks and Experiences unit was hit particularly hard by the outbreak last quarter. The segment's operating profit fell 58% compared with last year — shedding a billion dollars in profit just a few weeks into the global shutdown.

"The theme parks define Disney for millions of its fans around the world," Robert Niles, editor of ThemeParkInsider.com, told CNN Business. "Returning its parks to operation signals that Disney is coming back to full speed as a company again."

The grand reopening of the park is a big deal for Disney and the entire global tourism industry. It sends a message to the industry "that a safe reopening is possible," according to Niles.

"Disney is the market leader in not just the theme park business, but in tourism worldwide," Niles said. "It tells the industry that tourists likely will be back traveling again soon because no one draws tourists like Disney can."

Reopening its premiere park won't be easy, however. Getting Disney World back to business presents risks, both financially and in terms of public health, according to Trip Miller, a Disney shareholder and managing partner at Gullane Capital Partners.

"The risk is that coronavirus cases pop up again after opening. What do you do then?" Miller said. "Additionally, managing cast members health and keeping adequate staffing is a big challenge. If a Disney cast member contracts the virus, do you shut down the entire park? An area they were in? Do you refund tickets? You just don't want the happiest place on earth to be seen as a dangerous place."

The opening of Disney World is also a big test for Disney's new CEO Bob Chapek, who before taking over for Bob Iger in February, was the former head of Disney's parks and resorts division.

"I think Chapek is getting a real trial by fire that nobody could have predicted," Miller added. "However, his familiarity with the parks business is an advantage in dealing with this. He will have a unique perspective on how to operate Disney's parks as they reopen in this new world."

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