World's Biggest Legoland Adds to China's Amusement Park Glut
While construction of the project began when Chinese tourism was on its rebound post-pandemic and theme park tickets were selling out during major holidays, amusement destinations are now raking in less cash.
The recent three-day Dragon Boat Festival public holiday saw spending per trip go down 2.2% on year to 359 yuan , though the data refers to all travel trips and not just theme parks.
'The number of visitors to major foreign theme parks in China remained flat or rose slightly in 2024, but their revenue from secondary consumption within the parks decreased,' said Lin Huanjie, director of market research organization Institute for Theme Park Studies in China.
Morgan Stanley estimates that the Shanghai Disneyland, the top performing theme park in the country, will see revenue decline from $1.5 billion to $1.4 billion this year, according to a research note.
With theme parks no longer the novelty they once were and newer attractions set to open, the competition for visitors is set to grow fiercer. Warner Bros Discovery Inc. plans to open a Harry Potter studio tour in Shanghai in collaboration with Jinjiang International Group in 2027, while Asia's first Peppa Pig outdoor theme park is expected to open its doors also in Shanghai the same year.
Meanwhile, construction of the Shenzhen Legoland Resort is progressing with no official completion date.
While tourists have continued to visit parks based on foreign intellectual property, such as Disney and Universal Studios, domestic attractions have taken a knock. The number of visitors to large theme parks in China declined in 2024 compared to a year earlier due to economic pressures and volatile weather, according to a report from the institute. Almost a quarter of large theme parks lost money.
Vivian Lian, a theme-park loving housewife from Shanghai, said she will go to the new Legoland only if she can lay her hands on discounted tickets. Among those who feel the pinch of China's slowing economy, she has set strict limits on what she and her daughter can spend on visits to theme parks — a minimal amount on food is fine, while buying souvenirs is out of the question.
'The attendance in China is still quite good. It's just per capita spending isn't quite as high.' Hugh Johnston, chief financial officer at Walt Disney Co., said during an earnings call in May. 'Consumers are tightening their belts a little bit in that particular market.'
In recent years, Disney launched two land themed attractions — Frozen and Zootopia — with an eye on the surging domestic travel demand. Disneyland opened in 2016, with the Burbank, California-based entertainment company owning 43% of the project and the rest held by state-owned consortium Shanghai Shendi Group Co.
For local governments and business partners, the main appeal of investing in theme parks lies in the knock-on effects, such as the boost to business activity and property prices. According to Lin's calculations, every 1 yuan of revenue can generate 12-15 yuan income of relative industry such as hotel, restaurant, transportation in first-tier cities or provincial capitals.
However, the incentive for local governments to open large theme parks is generating concerns about oversupply. Although theme parks do not release their operation data, Lin noted that the revenue of theme parks in China decreased by an average of 15%-20%, compared with 71.84% on-year growth in 2023. Visionland in Liuzhou, Guangxi Province suspended operations in 2024 after seven years. The approval for new large theme parks has been tightened at the national level, Lin said.
Faced with more cost-conscious customers, theme parks are offering promotions to get people through the gates, such as cheaper tickets or discounts on food.
For Jessica Zhang, a Shanghai-based insurance broker, who drove nearly two hours to Legoland with her daughter and husband in early June before its official opening, the experience was enjoyable and she's considering returning. Still, 'it would be better if the tickets were cheaper,' she said.
This article was generated from an automated news agency feed without modifications to text.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
NDTV
19 minutes ago
- NDTV
Trump's Tariff Plans Would Cost US Employers $82.3 Billion: Analysis
Washington: An analysis finds a critical group of US employers would face a direct cost of $82.3 billion from President Donald Trump's current tariff plans, a sum that could potentially be managed through price hikes, layoffs, hiring freezes or lower profit margins. The analysis by the JPMorganChase Institute is among the first to measure the direct costs created by the import taxes on businesses with $10 million to $1 billion in annual revenue, a category including roughly a third of private-sector US workers. These companies are more dependent than other businesses on imports from China, India and Thailand - and the retail and wholesale sectors would be especially vulnerable to the import taxes being levied by the Republican president. The findings show clear trade-offs from Trump's import taxes, contradicting his claims foreign manufacturers would absorb the costs of the tariffs instead of US companies that rely on imports. While the tariffs launched under Trump have yet to boost overall inflation, large companies such as Amazon, Costco, Walmart and Williams-Sonoma delayed the potential reckoning by building up their inventories before the taxes could be imposed. The analysis comes just ahead of the July 9 deadline by Trump to formally set the tariff rates on goods from dozens of countries. Trump imposed that deadline after the financial markets panicked in response to his April tariff announcements, prompting him to schedule a 90-day negotiating period when most imports faced a 10% baseline tariff. China, Mexico and Canada face higher rates, and there are separate 50% tariffs on steel and aluminum. Had the initial April 2 tariffs stayed in place, the companies in the JPMorganChase Institute analysis would've faced additional direct costs of $187.6 billion. Under the current rates, the $82.3 billion would be equivalent on average to $2,080 per employee, or 3.1% of the average annual payroll. Those averages include firms that don't import goods and those that do. Asked Tuesday how trade talks are faring, Trump said simply: "Everything's going well." The president has indicated he'll set tariff rates given the logistical challenge of negotiating with so many nations. As the 90-day period comes to a close, only the United Kingdom has signed a trade framework with the Trump administration. Trump announced Wednesday he'd reached a deal with Vietnam, while India has signaled it's close to agreeing on a trade framework. Trump said on his social media site Vietnam will pay the US a 20% tariff on all goods sent "into our Territory" and a 40% tariff on any transshipping, which usually means exports that come from China but pass through Vietnam to dodge tariffs on Chinese goods. In return, Vietnam will grant the US "TOTAL ACCESS" to its market for trade, Trump said, meaning "we will be able to sell our product into Vietnam at ZERO Tariff." He added he thinks SUVs "will be a wonderful addition to the various product lines within Vietnam." There's a growing body of evidence suggesting more inflation could surface. The investment bank Goldman Sachs said in a report it expects companies to pass 60% of their tariff costs onto consumers. The Atlanta Federal Reserve has used its survey of businesses' inflation expectations to say companies could on average pass along roughly half their costs from a 10% tariff or a 25% tariff without reducing consumer demand. The JPMorganChase Institute findings suggest the tariffs could cause some domestic manufacturers to strengthen their roles as suppliers of goods. But it noted companies need to plan for a range of possible outcomes and wholesalers and retailers already operate on such low profit margins they might need to spread the tariffs' costs to their customers. The outlook for tariffs remains highly uncertain. Trump had stopped negotiations with Canada, only to restart them after the country dropped its plan to tax digital services. He similarly on Monday threatened more tariffs on Japan unless it buys more rice from the US. Treasury Secretary Scott Bessent said on Fox News Channel's "Fox & Friends" on Tuesday the concessions from the trade talks have impressed career officials at the Office of the US Trade Representative and other agencies. The treasury secretary said the Trump administration plans to discuss the contours of trade deals next week, prioritizing the tax cuts package passed on Tuesday by the Republican majority in the Senate. Trump has set a Friday deadline for passage of the multitrillion-dollar package, the costs of which the president hopes to offset with tariff revenues.
Time of India
29 minutes ago
- Time of India
China shows signs of tackling price wars taking toll on its EV industry
The Chinese government is signalling enough is enough when it comes to the fierce competition in the country's electric car market. China's industrial policy has engineered a remarkable transformation to electric vehicles in what is the world's largest auto market. In so doing, it has spawned far more makers than can possibly survive. Now, long-simmering concerns about oversupply and debilitating price wars are coming to the fore, even as the headline sales numbers soar to new heights. Market-leader BYD announced this week that its sales grew 31% in the first six months of the year to 2.1 million cars. Nearly half of those were pure electric vehicles and the rest were plug-in hybrids, it said in a Hong Kong Stock Exchange filing. The company phased out internal combustion engine cars in 2022. BYD came under thinly veiled criticism in late May when it launched a new round of price cuts, and several competitors followed suit. The chairman of Great Wall Motors warned the industry could come under threat if it continues on the same trajectory. "When volumes get bigger, it's just much harder to manage and you become the bullseye," said Lei Xing, an independent analyst who follows the industry. The government is trying to rein in what is called "involution" - a term initially applied to the rat race for young people in China and now to companies and industries engaged in meaningless competition that leads nowhere. BYD has come under criticism for using its dominant position in ways that some consider unfair, sparking price wars that have caused losses across the industry, said Murthy Grandhi, an India-based financial risk analyst at GlobalData. With the price war in its fourth year, Chinese automakers are looking abroad for profits. BYD's overseas sales more than doubled to 464,000 units in the first half of this year. Worried governments in the US and EU have imposed tariffs on made-in-China electric vehicles, saying that subsidies have given them an unfair advantage. Market leader BYD comes under attack The latest bout of handwringing started when BYD cut the price of more than 20 models on May 23. The same day, the chairman of Great Wall Motors, Wei Jianjun, said he was pessimistic about what he called the "healthy development" of the EV market. He drew a comparison to Evergrande, the Chinese real estate giant whose collapse sent the entire industry into a downturn from which it has yet to recover. "The Evergrande in the automobile industry already exists, but it is just yet to explode," he said in a video message posted on social media. Two days later, a BYD executive rejected any comparison to Evergrande and posted data-filled charts to buttress his case. "To be honest, I am confused and angry and it's ridiculous!" Li Yunfei, BYD's general manager of brand and public relations, wrote on social media. "All these come from the shocking remarks made by Chairman Wei of Great Wall Motors." Next, the government and an industry association weighed in. The China Association of Automobile Manufacturers called for fair competition and healthy development of the industry, noting that major price cuts by one automaker had triggered a new price war panic. On the same day, the Ministry of Industry and Information Technology vowed to tackle involution-style competition in the auto industry, saying that recent disorderly price wars posed a treat to the healthy and sustainable development of the sector. "That price cut might have been the final straw that irked both competitors and regulators for the ruthlessness that BYD continues to show," Lei said. A promise to pay suppliers within 60 days signals possible shift The following month, 17 automakers including BYD made a pledge: They would pay their suppliers within 60 days. One way China's automakers have been surviving the bruising price wars is by delaying the payments for months. The agreement, if adhered to, would reduce financial pressure on suppliers and could rein in some of the fierce competition. "The introduction of the 60-day payment pledge is the call of the government to oppose involution-style competition," said Cui Dongshu, the secretary-general of the China Passenger Car Association. It also reduces the risk of an Evergrande-like scenario. Many automakers had stretched out payments by paying suppliers with short-term debt - promises to repay them in a certain period of time - instead of cash. Real estate developers used the same system. It worked until it didn't. When Evergrande defaulted on its debts, suppliers were left holding worthless promises to pay. "This practice is seen as a potential cause of a larger crisis, similar to what happened with Evergrande," Grandhi said. The vows to speed up payments and the government calls to rein in the price wars, along with a rollback of some financing offers, point to an effort to reverse downward price expectations, said Jing Yang, a director at Fitch Ratings who focuses on the auto industry. "We may watch how effectively these measures are in reversing the price trend and how would that affect EV demand in the coming quarters," she said.
Fibre2Fashion
30 minutes ago
- Fibre2Fashion
Drewry WCI falls for 3rd week on weak US-bound cargo demand
The Drewry World Container Index (WCI)—a composite measure of container freight rates—continued to decline for the third consecutive week, falling 5.73 per cent to $2,812 per 40-foot equivalent unit (FEU) on July 3, down from $2,983 per FEU the previous week. This decline is directly attributed to low demand for US-bound cargo and signals that the recent surge in US imports, which followed the temporary suspension of higher US tariffs, is unlikely to have a lasting impact as initially expected. Drewry World Container Index dropped 5.73 per cent to $2,812 per FEU on July 3 due to weak demand for US-bound cargo. Freight rates on major routes, including Shanghaiâ€'Los Angeles and Shanghaiâ€'New York, fell sharply week-on-week, though they remain higher than 8 weeks ago. Drewry expects further declines amid oversupply and uncertainty surrounding future US tariffs and penalties on Chinese vessels. Freight rates from Shanghai to Los Angeles fell 15 per cent to $3,180 per 40ft container over the past week, although spot rates remain 17 per cent higher compared to eight weeks ago (May 8). Similarly, spot rates from Shanghai to New York dropped 11 per cent to $5,070 per 40ft container but are still up 39 per cent over the same eight-week period. Drewry expects spot rates to continue declining next week due to excess capacity and weak demand. Freight rates from Shanghai to Genoa decreased 9 per cent to $3,751 per 40ft container, while rates from Shanghai to Rotterdam increased 8 per cent to $3,468 per 40ft container. However, Drewry's Container Forecaster anticipates a further weakening of the supply-demand balance in the second half of this year, which may lead to continued declines in spot rates. The volatility and timing of rate changes will depend on future US tariffs under Trump's policies and potential capacity adjustments related to the imposition of US penalties on Chinese vessels—factors that remain uncertain. Fibre2Fashion News Desk (KUL)
