Disney World Increases Attendance Limit; Mask Relaxation “Very Big News”
Walt Disney Company reported its second quarter earnings on an investor call. We’ve already covered the numbers there in Disney Parks Lose $967 Million, But Demand Grows. If you’re curious about Disney+ subscribers stats or whether EPS beat projections, check that out.
In this post, we’re going to discuss the “juicier” topics that have real world implications for those planning Walt Disney World or Disneyland vacations. Namely, attendance limits capacity, Disney Park Pass reservations, and health safety protocol at Walt Disney World and Disneyland.
The updates on these fronts all came during the investor question and answer portion of Disney’s earnings call, during which Disney CEO Bob Chapek and CFO Christine McCarthy tackled a range of topics. Some of their responses are of particular relevance and interest for anyone planning a summer vacation to Walt Disney World…
The first question inquired as to whether there was “any color” Chapek could provide on how when it would be okay to start raising capacity at Walt Disney World. In response, Chapek stated that Walt Disney World has already started to raise capacity caps based on past guidance from both the CDC and Florida ending of all emergency orders.
It’s not a huge surprise that Walt Disney World has already started to increase capacity. There have been numerous reports of crowd levels increasing around Mother’s Day weekend, and increased of Park Pass reservations would seem to corroborate those.
Moreover, just yesterday Walt Disney World announced that physical distancing would be relaxed, stating that this would occur “across many areas with a gradual, phased approach” but also that “six-feet distancing measures will continue in all dining locations, merchandise stores and in areas where guests can temporarily remove their masks.”
It’s a given that Walt Disney World would distribute more Park Pass reservations as a result of this move. The only question is how quickly Disney would ramp up, and to what level. It’s likely going to be a gradual increase, with the parks operating at around 50% capacity by the start of summer. At some point, it’s likely that organic demand will be more of a limiting factor on attendance than the park capacity caps.
During the Q&A, Chapek was also asked how Walt Disney World would be able to scale up attendance given reports of heavy crowds already. In response, he stated “we don’t think we’re going to have any problem at all…that is not something that keeps any of us up at night.”
Continuing to address demand, he said: “So we’ve sort of got the perfect positive storm, if you will, where we’ve got plenty of demand, we’ve got really great yield management gains, and the cost management at the same time. In terms of labor, we had about 80% of our cast members return that we’ve asked to return. [We] continue to get more and more cast members back, it thrills us to be able to do that. We’ve had no problems whatsoever in terms of trying to get our cast to come back and make some magic for our guests.”
That’s actually a bit surprising, and also perhaps a bit misleading. I’m shocked that the return rate is 80% because that flies in the face of the rampant reports of hiring woes all around Central Florida, including at Walt Disney World.
In fact, we know that Disney accelerated the return of the College Program to Summer 2021 because of staffing shortages, has numerous job openings, and is actively advertising that its hiring in the Orlando market.
Much more noteworthy was Chapek’s statement that the CDC’s newly-released guidance ending face mask recommendations outdoors and in uncrowded indoor settings is “very big news” for Walt Disney World, “particularly if anybody’s been in Florida in the middle of the summer with a mask on. That could be quite daunting.”
Chapek expects this will make for an even more pleasant experience and that it’s going to be an even bigger catalyst for growth in attendance. Disney is “very, very excited about that.”
This is very interesting to us, and frankly a bit surprising. As you might recall, Chapek was asked similar questions during the last earnings call.
In response, he stated that Disney has no doubt that parks will have “some level” of physical distancing and mask-wearing for the remainder of 2021. However, he also said that Disney views vaccines as a “game-changer.”
At that time, most other sites and Disney fans emphasized the “remainder of 2021” part of Chapek’s quote, citing it as “proof” that face masks would be in place at Walt Disney World until 2022.
We disagreed, emphasizing the some level and game-changer parts. In parsing Chapek’s words, it appeared to us that Disney was laying the groundwork for changing its approach to health safety protocol so rules can be relaxed on an earlier timeline. We’ve since reiterated and double-downed on that in several posts, even as many readers have criticized us for being too bold and optimistic in our predictions.
I would take a victory lap here, but I’m honestly not entirely sure what Chapek’s quote means because his answer intertwines attendance limits and Disney’s face mask rule.
It sure sounds like he’s suggesting that Walt Disney World will be relaxing its face mask rule based upon the CDC guidance, and saying that’ll be a relief for anyone who has been to Florida in the summer. However, it was an off the cuff, non-binding statement that also related to attendance limits.
To be 100% clear, I’m not suddenly pessimistic about a relaxation to Walt Disney World’s face mask rules. If anything, I’m slightly more optimistic than I was before the call started. However, I’ve been pretty bullish for the last several months and this is more or less consistent with what I’ve expected since even prior to the last earning’s call.
In my view, the newly-released CDC guidance is the big news story of the day. It’s worth pointing out that the CDC press conference ended shortly before this earnings call began, meaning it’s entirely possible that Disney’s health team has not yet fully assessed and briefed Chapek on the implications and how Walt Disney World and Disneyland should proceed.
Trying to reconcile the new CDC guidance with Chapek’s statements, I think the most likely scenario is Walt Disney World relaxing the outdoor mask policy for everyone at or around the start of the summer tourist season.
As we’ve pointed out repeatedly, Walt Disney World cannot and will not enforce a policy that distinguishes between vaccinated and unvaccinated guests. Even setting aside the contentious vaccine passport debate, it would simply be overly burdensome for frontline Cast Members, who are already being asked to do too much.
More likely, Walt Disney World will continue requiring masks indoors while shifting from a rule to a recommendation outdoors, perhaps with some verbiage encouraging or “requiring” the unvaccinated to continuing wearing a mask for their safety and that of other guests. If it’s a requirement (air quotes), it’s likely that Disney would take a hands-off approach enforcement.
In our view, this would comport with the overwhelming body of scientific evidence about transmission as well as guest expectations. It would also mesh with the practical realities of wearing a mask during summer in Florida being “daunting,” as a certain CEO put it. Being able to take mask-less photos is already a huge win, and not having to wear them in the heat and humidity outdoors would be another.
Ultimately, I view both today’s new CDC guidance and Chapek’s answers to investor questions as very positive developments that should significantly accelerate Walt Disney World’s return to normalcy. I’m even more bullish than before, but also not taking his answers at face value. The how and when of any health safety protocol and rule relaxation remains to be seen.
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YOUR THOUGHTS
Thoughts on Disney CEO Bob Chapek’s statements about face masks and attendance limits at Walt Disney World? Do you agree or disagree with him that it can be “quite daunting” to wear a mask in Florida during summertime? Do you think this signals that Walt Disney World has more plans to return to normal? Are you hoping that Disney follows the CDC’s lead, or keeps its mask rules in place longer? Please keep the comments civil. This is not the place for arguing about efficacy, politics, and so forth—all such comments will be deleted, irrespective of perspective. You are not going to change anyone’s mind via the comments section on this blog, nor are you going to change Disney’s rules or public policy. If you wish to contest this, rather than yelling into the internet abyss, have your voice heard in a meaningful way by contacting Disney or your local elected officials.
I wish they would require vaccinations for entry. People without them are spreaders and should be staying away from crowded events.
I think you’re spot on and Disney will ease restrictions on masks outside but not inside at least at first. I think they were fighting a losing battle – they could require masks last summer even with the heat because the crowds were so much smaller and many people WANTED to wear them (and see everyone else wearing them) for protection. Now that many are vaccinated, it’s more crowded, and it’s getting hot it was going to be hard to enforce. I saw a lot lower compliance last week on the days it was up to 95 degrees.
Any thoughts on when they might release more park passes for mid-June? I have a guest I’m adding and would like to be able to get it all situated…
If they follow CDC guidance, doesn’t that mean anyone between 2 and 12 (who legally can’t get vaccinated yet) would be required to wear a mask? They don’t need “vaccine passports” to know an 8yo isn’t vaccinated. Hard to imagine adults not wearing them and it being enforced for kids. Lots of mixed messaging
Any thoughts on what this could mean for the return of fastpass, dining capacity or reservation availability, hotel reopenings, etc?
I would love to hear your thoughts, even if they are a bit of a guess, on that. So far your guesses have been pretty darn good!
” ‘In terms of labor, we had about 80% of our cast members return that we’ve asked to return.’ . . . I’m shocked that the return rate is 80% because that flies in the face of the rampant reports of hiring woes all around Central Florida, including at Walt Disney World.”
Perhaps the key there is the “asked to return” qualifier. They probably aren’t counting Cast Members they know left the area or who they may know would not return, plus perhaps they even informally inquired to some about whether they would come back before formally asking them to return. If Disney knew the CM wouldn’t be returning, they may not have extended a formal offer/request to return, so they wouldn’t count them in the percentages of those “asked to return.”
Everyone likes to focus on the masks but I’m more interested in the “cost management” quote. What exactly does that mean? It sounds like a tacit admission that the things currently absent from the parks are as much about saving money as safety. And if Disney sees strong demand without those expenses, what incentive from a business perspective do they have to return those things? They’ve been steadily reducing the number of parades for *years* and I wouldn’t put it past them to adopt a more limited schedule for the nighttime spectaculars (3-4 times a week instead of every night, especially in the off season). To say nothing of the in park shows, which aren’t direct revenue generators. Guests can claim those are important to them but if I’m looking at things from a cost savings perspective the projected level of demand for the summer (at full price) sure seems to indicate that I don’t need to bring those back.
I know blog comments don’t reflect the majority but I worry that all the online chatter about whether or not to visit the parks right now centers on masks. “I won’t be back at the parks until the mask mandate goes away” sends the message that all the other things that are missing now are ultimately fine.
I like the positivity in your post. I don’t understand those who take time out of their day to log onto a blog to tell everyone what they not going to do (go to Disney) and why they are not going to do it. This is not a political issue and I don’t understand the need to try and cram everything into a political framework, it is a public health issue. Disney is being relatively conservative with their approach to this, most likely out of concern for their staff which I appreciate. And, most likely, because they are a huge company and make decisions slowly and carefully. If we get vaccinated, be positive and be kind we can exit what has been a tough time for everybody.
I think it’s absurd to have young children wear masks. They are and have been since the beginning, the least likely to have an issue with Covid. You will be hard pressed in any business to have adults with no masks and children with masks. No one will spend money to go somewhere and have their kids be miserable while the adults are happy. I think the CDC is going to make a separate announcement for that. Children 2-11 don’t have the vaccine available and parents are not going to jump to do it when they rush that approval through, especially since the data has shown minimal risk from the beginning, and we don’t know yet what the long term effects will be on a developing child’s body.
I’m over Disney and their politics. Masks or No masks. Sad but true.
I do still think it will come down to protecting their CMs. If all of their employees have been afforded ample opportunity to get the vaccine, and Disney feels they can safely waive liability for those who refuse to get it, then I think we will see mask mandates lifted. I don’t say this to be cynical. I think thecsafery and well-being of their employees is genuinely top priority. I just also think if employees are unwind to help themselves, at some point, the employer should no longer be liable for exposure work place hazards, but until they reach that line, they also need to consider their bottom line.
I think they should have relaxed the mask policy before they increased park capacity.
But kids 2-11 will still have to wear masks per CDC
I am going in November, assuming you will open up to UK tourists!! Do you think they may bring back masks in the winter months?
For those who are vaccinated but concerned about being around unvaccinated people, you don’t need to be! You are protected. Even the CDC said that vaccinated people can hang out with unvaccinated people unrestricted. It really doesn’t seem medically necessary to keep masks for much longer given the rate of vaccination.
You really don’t need to be. If you are vaccinated, you are protected! It is almost certainly not medically necessary to keep masks for 7 more months (!) given the rate of vaccination.
Sooo…they will not be returning fast passes?
But what about Disneyland?? What does this new CDC guidline mean for the C A park??
Tom: Another home run for you. A very thoughtful and well reasoned piece. Thank you!
So happy to read this! Going the end of August and hoping to at least not wear masks outdoors in the parks. This is a big achievement for everyone. We all went through a terrible time and came together to get the vaccines, get the job done and finally move forward with life. Let’s keep moving in a positive direction!