Future of Hong Kong Disneyland rests on more magic
- Another loss at Covid-hit Hong Kong theme park is no surprise, and there is much work ahead to ensure it has a happy ending
The past three years have been a nightmare for Hong Kong Disneyland. While Sleeping Beauty may have finally awakened from a Covid-induced freeze, the way forward from here is far from clear. As the Magic Kingdom rolls out more new attractions later this year in the hope of making a strong comeback, it must continue to adapt to a fast changing tourism world.
In common with all tourism operators, the theme park suffered enormously as a result of intermittent business bans and social-distancing rules during the pandemic. Some relief is provided by its smaller deficit. According to management, the net loss shrank 12 per cent year on year to HK$2.1 billion in 2022. Considering the attraction only operated for 190 days, about half its financial year ending September 30, the numbers are not as bad as they sound.
But the fact remains that it was Disneyland’s eighth year in a row without turning a profit. Indeed, it has only managed to do so on three occasions since opening in 2005, and its sustainability in the long run remains an issue of public concern, especially when the government has invested heavily in the project through its joint venture with the US company.
The embattled attraction relied on local people to stay afloat, with its attendance rising by 22 per cent to 3.4 million in 2021-22 and revenues growing by 31 per cent to HK$2.2 billion. The company remains optimistic about the future, particularly with the increase in arrivals following the reopening of the city. But it must not forget that it can no longer pin its hopes too heavily on mainland tourists, who tend to travel far and wide these days. Local patronage is also expected to fall as more Hongkongers travel abroad.
Notwithstanding its less than impressive performance over the years, the Disney brand makes the Lantau Island theme park still one of the top attractions for locals and foreigners alike. Whether the opening of a new section in November, a Frozen-themed attraction based on the popular animated films, can do wonders remains to be seen. But the company must not assume there will be more visitors when tourism returns. A more sustainable strategy must be worked out to ensure that the Disney magic will not fade.
