UPDATED with more details: Disney CEO Bob Chapek said Tuesday during the company’s second-quarter earnings call that it plans to open its Shanghai Disneyland theme park on May 11. It was the first park to be shut down as the coronavirus began spreading from China to the rest of the world.
Disney Senior SVP and CFO Christine M. McCarthy said there was no update on the status of Disney’s other parks, including Disneyland in Anaheim and Disney World Resort in Orlando which have been closed since mid-March, leading to salary cuts and furloughs.
The news comes after Disney reported today that estimated COVID-19 impact on the company’s second-quarter operating income at its Parks, Experiences and Products segment was about $1 billion, “primarily due to revenue lost as a result of the closures” of its domestic and international theme parks. That’s a huge chunk of the estimated overall company impact of $1.4 billion.
Chapek said on the call that the company’s working hypothesis in making decisions to open its parks is asking whether it would act as a contribution to the company’s net contribution to profits. The company is working under the assumption there is a “pent-up demand” from attendees, in which case any open parks “wouldn’t have trouble” filling 10%, 20% or 50% of capacity. He called labor “a huge component of our cost base” and would ramp up alongside attendance.
Disney’s Shanghai and Hong Kong parks were closed in January, followed by Tokyo in February and the U.S. parks and Disneyland Paris since mid-March.
Chapek also told analysts during the call that the decision to reopen the park comes in part due to the lessening of the COVID-19 restrictions in China, where the virus originally broke out in December. It also comes after Disney in early March reopened portions of the Shanghai Disney Resort complex outside the main theme park including Disneytown, Wishing Star Park and Shanghai Disney Hotel.
He said the success of those reopenings helped fuel the decision to reopen the main park, which has a capacity of 80,000 but will open at first “much lower” than that out of caution, hewing close to 30% of capacity per government guidelines. Chapek also said the reopening of the theme park will include “guest capacity” and “density control measures, and Disney sent out a statement with measures and procedures set for the opening, which could act as a roadmap for other parks and large-venue operations.
The measures include:
— Limited and pulsed attendance with an advanced reservation and entry system: Guests are required to purchase admission tickets valid on a selected date only and Annual Pass holders must make a reservation prior to arrival.
— Controlled guest density: Capacity will be recommended and managed in queues, restaurants, ride vehicles and other facilities. Queues will be structured and ride vehicles will be loaded to promote social distancing.
— Implementing required government health and prevention procedures: This includes temperature screening and the use of the government-issued Shanghai Health QR code, a contact tracing and early detection system used in China. Additionally, guests must wear a mask during their visit, except when dining.
— Increased sanitization and disinfection measures: Hand sanitizers will be available at queue entries and attraction exits. High-touch locations, such as ride vehicles, handlebars, queue railings and turnstiles will have increased sanitization.
— Training for cast members: Cast members will receive training on procedures with an emphasis on contactless guest interaction, cleaning and social distancing and will receive additional protective equipment including masks.