The Disneyland Paris Resort
did not enjoy a pleasant birth.
Following on from the success of the DisneyLand theme park in Anaheim,
plans to build a European version first started around 1975, nine years
after Walt Disney died. Initially Britain, Italy, Spain and France were
all considered as possible locations, though Britain and Italy were quickly
dropped from the list of potential sites because they both lacked a suitably
large expanse of flat land. The WDC were determined not to make the same
mistake as in Anaheim, where speculators bought the land surrounding the
first Park and proceeded to cash in on its success.
The most likely site was felt to be in the Alicante area of Spain, which
had a similar climate to that in Florida for a large part of the year.
However, the area was also beset by the notorious Mistral winds.
Eventually the French location won, and a site was duly investigated at Marne-la-Vallee, partly because of its close proximity to Paris, and also its central position within Europe, a factor thought to be crucial to the Park's future success if it was to attract sufficient visitors. The proposed location put the park within 4 hours drive for around 68 million people, and 2 hours flight for a further 300 million or so.
Michael Eisner signed the first letter of agreement with the French Government
in December 1985, and started to draw up the financial contracts during
the following spring. Robert Fitzpatrick, a key organiser of the 1984
Los Angeles Olympics, was appointed as the Euro Disney President, and
the park slowly started to take shape, with construction starting on the
2,000 hectare site - about one fifth the size of Paris - in August 1988.
In December 1990, Espace Euro Disney (an information centre) was opened
to the public to show what Disney were constructing. This was followed
by the opening of the casting centre on 1st September 1991 in order to
start recruiting the hundreds of Cast Members who would ultimately operate
the park's many attractions.
Meanwhile, the Government's compulsory purchasing of the farmland in Marne
la Valee had not endowed the local agrarians with unalloyed joy and they,
together with the French Cultural Elite, waged a war of words against
the new theme park, its owners and Americans in general. Nevertheless,
the French Government pressed ahead and Euro Disney first opened to employees,
for testing, during late March 1992, during which time the main sponsors
and their families were invited to visit the new park. The formal press
preview day was held on April 11th 1992, and the park finally opened to
visitors on April 12th 1992.
The opening day crowds, expected to number up to half a million visitors,
failed to materialise, however, and at close of the first day barely 50,000
people had passed through the gates.
The first phase of development (the theme park, hotel complex and golf
course) had gone massively over budget, and had eventually cost 22 billion
French Francs to complete. Over the next few months attendance figures
failed to improve much, and by May the park was only attracting something
like 25,000 visitors a day, instead of the predicted 60,000. Combined
with the realisation that only 3 in every 10 visitors were native French,
the Euro Disney company stock price started a rapid downward spiral, losing
almost four fifths of its value. Combined with incredibly optimistic over-pricing
of hotel rooms, meals and merchandise, the Park was headed for a disaster.
Crisis looms...
By August 1992 estimates of annual attendance figures were being drastically
revised downwards from 11 million to just over 9 million. EuroDisney's
misfortunes were further compounded in late 1992 when a European recession
caused property prices to drop sharply, and the massive interest payments
on the start-up loans taken out by EuroDisney forced the company into
serious financial difficulties. The situation was worsened by the fact
that the cheap dollar was persuading more and more people to forego Europe
in favour of holidays in Florida at Walt Disney World and the French Franc
had risen dramatically against other European currencies, especially Sterling.
British visitors to the Park found they couldn't afford to eat and he
author's own family, who stayed in the Cheyenne Hotel during this period,
lost weight as they could only afford to feed the children and had to
exist on milk (incredibly good value at that time!) and black coffee for
five days.
EuroDisney was also over-populated with hotels, especially for a park
that could be reasonably well explored within a full day. Coupled with
high prices for food and souvenirs, the EuroDisney company started to
close hotels during the winter months and even consider the seasonal closure
of the Park itself. The European media had a field day with ‘Disaster
for Disney’ stories and the tabloid press - never ones to worry overmuch
about accuracy or fact - had themselves photographed in deserted parts
of the park on wet Tuesday mornings. A brave face was put on the first
anniversary of the park's opening, and Sleeping Beauty's Castle was decorated
as a giant birthday cake to celebrate the occasion. However, further problems
lurked around the corner.
In summer 1993 the new Indiana Jones roller coaster ride opened, but disaster
struck just a few weeks after opening when the emergency brakes locked
on during a ride, causing some guest injuries. As a result the ride was
temporarily shut down for investigations.
By the start of 1994, with the company in serious financial difficulties,
and rumours circulating that the Park was on the verge of bankruptcy a
series of emergency crisis talks were held between the banks and backers.
Rescue...
Matters came to a head during March 1994 when Team Disney presented the
38 backing Banks with an ultimatum: The WDC would provide sufficient capital
investment for the park to continue to operate until the end of the month,
but would close the park, and walk away from the entire European venture,
unless the banks agreed to restructure the $1bn debt that the park's construction
and operation had run up, The bankers realised that, to be left with a
bankrupt theme park and a massive expanse of virtually worthless real
estate would not be in their best interests and, since most of them had
been writing off loans to third world countries for some time, wondered
whether their desks would still be there the following day.
EuroDisney then forced the banks’ hands by calling the annual stock-holder
meeting for March 15th. Faced with no alternative other than to announce
to the stock holders that the park was about to close the banks started
looking for ways to refinance and restructure the massive debts. Cleverly
increasing the pressure on the banks, Michael Eisner, Disney's CEO, went
public shortly before the stock-holder meeting and announced that Disney
were planning to pull the plug on the venture at the end of March 1994
unless the banks were prepared to restructure the loans.
On March 14th, just prior to the annual meeting the banks capitulated,
and agreed to Disney's demands, effectively writing off virtually all
of the next two years worth of interest payments, and agreed a three year
postponement of further loan repayments. In return the Walt Disney Company
wrote off $210m in unpaid bills for services, and paid $540m for a 49%
stake in the estimated value of the park, as well as restructuring its
own loan arrangements for the $210m worth of rides at the new park. In
addition, a Saudi Prince - Prince Alwaleed - invested heavily in the park,
purchasing 23% of the stock.
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The tide turns...
By August of 1994 the Park was slowly starting to find its feet, and all
of the Park's hotels were fully booked during the peak holiday season.
In October 1994 the Park's name was officially changed from EuroDisney
to "Disneyland Paris", in order to strngthen the link between
the Park and the romantic city of Paris, and to disassociate itself from
the poor reputation that had become linked with the name "Euro Disney".
At the same time, prices for food in the Disneyland cafes were substantially
reduced, the French Franc began a slide against Sterling and hotel and
package prices were reduced. These actions were to effectively double
the number of visitors from the UK and other regions of Europe, but not
until 1995, owing to the built in 'lag' caused by British holiday planning
patterns.
The end of year figures for 1994 showed encouraging signs as the previous
year's £650 million loss was reduced to around £200 million,
despite a 10% fall in attendance caused by bad publicity over the earlier
financial problems.
By the end of March 1995 top Walt Disney executives were predicting that
DisneyLand Paris would break-even by the end of 1995.
Helped by the opening of Space Mountain on June 1st 1995, in August that
year Disneyland Paris and the Euro Disney resort complex announced a £22m
profit, followed by the first annual operating profit announced in November
1995. The Gaumant conemas opened in the Disney Village in 1996 and Planet
Hollywood opened in 1997. During that two years, rates across the resort
remained stable, groundbreaking for the ambitious Val d’Europe project
commenced and the Park itself acquired new attractions in the shape of
The Storybook water ride and Casey Jr. mini coaster.
1998 saw the World Cup held in France which dented attendance figures
but still 12.7 million visited the park. Theme park spending per guest
increased markedly and France, Benelux and the UK respectively accounted
for 70% of the Park’s guests. A second State of the Art convention
centre was opened at the Newport Bay Hotel, the Park transplanted the
WDW ‘Tinkerbell’s fantasy in the Sky’ from WDW to DLP and
the Gaumont Cinema chain opened an extra 16 screens. At this time, the
interest rate payments which the banks had foregone in 1994 and the royalties
payments to the WDC became due in stages, so - despite increased revenues
- the overall profits for the Park were reduced.
In 1999, Disney Village continued its aggressive expansion phase with
the opening of the Rainforest and MacDonald’s cafes and the building
of the Walt Disney Studios was commenced in earnest. The Park saw ‘Honey,
I shrunk the Audience’ open, having been imported from WDW’s
Epcot Centre. To deal with the different holiday patterns in Europe, weekends
became a focus for packages and the Park expanded the seasonal entertainment
specials, including Halloween, Guy Fawkes (the French love that one!)
and Christmas which had the combined effect of filling the hotels at weekends
and up to 82% during the weekdays.
On the 26th December, 1999, however, a monster storm devastated the park,
damaging and destroying much of the Camp Davy Crockett, the newly launched
Crescend’O tented show in Disney Village and closing the park for
several hours, a disaster given the peak holiday period.
Undeterred, 2000 saw the introduction of FastPass, a re-engineering of
Indiana Jones (it goes backwards, now!) the presentation of Tarzan on
the Chaparral theatre stage and the opening of a kids’ play area,
Pirate Beach in Adventureland. The ill fated Agrabah cafe was also opened,
shortly before being gutted by fire. Nonetheless, France and the UK now
accounted for over 55% of visitors and Germany was an increasing contributor.
In 2001, hotel occupancy increased to over 86% - an astonishing figure,
well in excess of Florida's park - and the Park welcomed its millionth
visitor. Only Toon circus was new in entertainment terms, although the
phenomenally successful Mulan continued to run in Videopolis but Jay Rasulo
was able to announce that the Walt Disney Studios would be opened on 16th
March, 2002. The symbolism of opening the new Park, ahead of schedule
before the tenth anniversary of the opening of Eurodisney was potent,
and a marker of maturity for the company. Just when the future held much
promise, however, fate was to deal the worst blow.
In the summer of 2001, alerted by French Intelligence of a possible terrorist strike against American interests, security increased dramatically at the Park. September 11th brought tragic confirmation of that warning and damaged the package holiday, Airline and Travel industries substantially.
In 2003, Jay Rasulo - who had opened the new Studios, was promoted to greater things within the comapny, and a new boy - Andre Lacroix, at 33 a young man - took over. His first public statements laid bare the worrying financial position of the company. The ongoing problems in tourism, the French labour difficulties and the costs incurred in building the new park whuch had failed to realise its potential had all combined to damage the profitabilty of the resort, which had incurred its first serious loss in several years. At the time of writing, Andre has implemented the "Need Magic?" campaign, which - with short but pithy slots on all TV channels in Europe - is firmly aimed at the first time visitor. Only time will tell if this strategy will succeed.
For an in-depth interview with the designer of the Park, click here
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