Star Wars Biggest Failure Is Costing Disney An Astronomical Amount Of Money
After investing hundreds of millions of dollars into creating a Star Wars-themed immersive hotel experience, Walt Disney World decided to shut it down. The decision to shutter the aptly named Galactic Starcruiser came in May 2023, just 18 months after the hotel opened. According to interim CFO Kevin Lansberry, the closure will cost the company $250 million in accelerated depreciation.
Confirmation of the Star Wars hotel closure came during Disney’s quarterly earnings report. During the call, the company hinted at price increases for its Disney+ streaming service. The Orange County Register reports that. Bob Iger also attempt to walk back on his previous comments about the ongoing strike action by the WGA and SAG-AFTRA.
Disney will take a $250 million hit for closing down their Star Wars: Galactic Starcruiser hotel.
The Star Wars: Galactic Starcruiser is expected to close on September 30, 2023. The hotel opened its doors on March 1, 2022, but promptly encountered problems. Two weeks after its launch, Disney faced challenges filling rooms due to its steep cost. A two-night stay in a cabin or suite and various thematic elements came with a price tag of $4,809 for two guests and $5,999 for four.
There were also stretches of several months with no reservations at all. During the rare instances when the hotel was fully booked, the reservations later gave way to cancellations. The Star Wars: Galactic Starcruiser offered a selection of room sizes, each with a different theme. These experiences included interactions with characters from the movies.
However, it was the story element of the hotel that set the experience apart from similar locations. Set between the events of Star Wars: The Last Jedi and Star Wars: The Rise of Skywalker, guests received a detailed schedule upon check-in, outlining the various hotel-based activities available for them during their stay.
While a $250 million loss might not be much for a corporation as massive as Disney, since revenues for the Disney Parks, Experiences, and Products segment surged by 13 percent to $8.3 billion in the same quarter—its significance as an inauspicious conclusion to the Star Wars: Galactic Starcruiser is undeniable.
Fortunately, the financial results at Disneyland Resort were up compared to 2022. The increase in visitor spending at the resort can be directly attributed to a rise in the average ticket prices, as outlined in the quarterly report. However, the augmented attendance and increased visitor spending observed at the Disneyland resort were largely balanced by elevated inflation-driven expenses.
Two weeks after its launch, Disney faced challenges filling rooms due to its steep cost.
Despite the failure of the Star Wars hotel, Disneyland’s success in drawing attendance and boosting visitor spending has been propelled by notable events such as the unveiling of the revamped Mickey’s Toontown and the centennial festivities of the Walt Disney Company. Daily admission now costs between $104 and $179, while Magic Key annual passes range between $449 and $1,599.
Disney vs. Florida
The Star Wars hotel’s closure comes amid an ongoing legal battle between Disney World and the state of Florida involving Governor Rob DeSantis. Since 2022, Disney World and DeSantis have traded blows over the Governor’s “Don’t Say Gay” bill, which marked the first move in a series of legal attempts to remove safeguards from LGBTQ+ individuals within the state.
