Long before gasoline jumped above $2 per gallon, owners of L.A.-area theme parks had invested heavily on sprucing up, adding rides and developing new attractions, all with the expectation that the improvements would draw hordes of visitors this summer.
Now, even with all those new and improved attractions, theme parks are likely to see flat attendance this summer, according to analysts' projections, as high gas prices and the lagging economy keep nervous job-holders at home during the vacation months.
Those deciding to venture forth, however, will find three new roller coasters at Six Flags Magic Mountain; two new kids' attractions, Nickelodeon Blast Zone and Animal Planet Live, at Universal Studios, which launched them to balance its traditional shows and rides; and a $100 million upgrade just completed at Knott's Berry Farm, including a new roller coaster and water park.
And then there's the Walt Disney Co., which opened its California Adventure theme park in February.
For Disney, even a new theme park may not bring in the numbers that the company anticipated. Park-goers have given California Adventure less-than-sparkling reviews, and daily attendance figures have been thousands short of projections.
If there is a bright spot on the summer horizon for Disney, it is that many out-of-town vacationers plan their trips months in advance.
"It will take six months before (the softening economy) translates into lower attendance to the Disney theme parks because people book vacations six months in advance," said Kathy Styponias, an entertainment industry analyst at Prudential Securities Inc.
But that's not to say the summer outlook is sunny for Disney and other local park operators.
"In general, we lowered our expectations for theme parks, in terms of attendance, owing to the softness of the economy," said Styponias.
Prudential originally projected a 1 to 2 percent growth in attendance for Disney theme parks this year, compared to more than 3 percent growth last year.
Styponias is now forecasting no growth for this year, despite a strong start. "The December quarter was not a bad quarter for parks, and neither was the March quarter. Our assumption is, as third and fourth quarters look weaker, that averages out (to zero growth for the year)," she said.
As for California Adventure, analyst David Miller of Sutro & Co. pointed out that the new park was expected to bring in 5.5 million visitors this year, or about 15,000 visitors a day. Instead, it has been averaging 12,000 or so a day, he said.
The lackluster 2001 attendance figures comes on the heels of a generally respectable 2000.
While theme park operators generally do not release actual or projected attendance figures, industry trade publication Amusement Business put Disneyland's 2000 attendance at 13.9 million, up 3 percent from 1999. It estimated Universal Studios' 2000 attendance at 5.2 million, up 2 percent from 1999, and Six Flags Magic Mountain up 3 percent to 3.3 million. Only one local park, Knott's Berry Farm, dropped in attendance last year, down 4 percent to 3.5 million visitors, according to Amusement Business.
Ironically, the economic downturn might actually help boost attendance at smaller parks that are more regional like Six Flags Magic Mountain and Knott's Berry Farm as more local residents choose to stay home this summer rather than blow wads of money on a trip to Europe or other far-off destinations.
"There's a different mix for Knott's Berry Farm than Disney," said Peter Swan, an analyst at Pacific Growth Equities in San Francisco who covers Cedar Fair LP, owner of Knott's Berry Farm. "You can't compare the two. Disney is a theme park, which traditionally makes it more of a destination resort. With amusement parks, it's different. People at Knott's are teenagers and adults, thrill ride seekers. They're not going there for a destination."
The same goes for Six Flags Magic Mountain. Spokesman Andy Gallardo said the park is on track for good attendance this summer, since most of its park-goers live within a 30- to 40-mile radius.
Yet even Universal Studios, which considers itself a destination, is touting the silver lining in the dark economic clouds.
"With the economy downturn experience, it's possible that locals remain at home and avail themselves to entertainment options here in Los Angeles," said Eliot Sekular, spokesman at Universal Studios, a unit of Vivendi-Universal. "We could be beneficiaries of that."
Actually, when compared to other theme parks around the world, those in the Los Angeles area tend to be more regional in nature. While 50 percent of attendees to Disney World in Orlando, Fla. come from the immediate region, 70 percent of Disneyland visitors are from nearby.
Yet Disney is trying to entice more out-of-towners to Anaheim with the opening of California Adventure, a four-month-old park with California-themed rides.Targeting Disney
Other parks have responded quickly to the Disney challenge, adding new rides and features. Universal Studios this year initiated a shuttle service to transport Disneyland visitors to Universal City and then back to Anaheim, and it is considering other plans, as yet unannounced, for the summer to lure people to the park, Sekular said.
Disney has some tactics percolating as well. Its popular Main Street Electrical Parade, which was moved from Disneyland to Disney World in 1996, is being brought to California Adventure beginning in July, confirmed Tom Brocato, a Disney spokesman.
Disney has also launched a marketing campaign "Are You Mouse Enough?" to bring more interest to California Adventure. And the company recently began offering three-day and four-day "hopper" tickets for $111 and $137, respectively, that let park-goers go back and forth between the two parks.
The hopper tickets provide a 15 to 20 percent savings compared with the $43 a day regular admission price charged for each park.
(Actually, Disney's decision to price California Adventure at the same level as Disneyland has drawn some criticism, since the new park has only 22 rides.)
Despite initial lackluster attendance, Disney remains optimistic. In Orlando, Fla., both its MGM Studios park, which opened during the recession of the early 1990s, and Epcot Center, also suffered low attendance initially. So early attendance figures are not always an accurate indicator of long-term popularity, Styponias pointed out.
And once summer gets into full swing, a number of people who have thus far stayed away may ultimately be enticed to jump into their cars and head to a local amusement park.
"I think theme parks and summertime are synonymous," said Gallardo of Six Flags Magic Mountain. "People will always find a way to make those trips."
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