Crisis looms...
By August 1992 estimates of annual attendance figures were being drastically revised downwards from 11 million to just over 9 million. Euro Disney’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 Euro Disney 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.

Euro Disney 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 Euro Disney 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.

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.

Euro Disney then forced the banks’ hands by calling the annual stockholder meeting for March 15th. Faced with no alternative other than to announce to the stockholders 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.

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 Euro Disney to "Disneyland Paris", in order to strengthen 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 that the banks had foregone in 1994 and the royalty’s 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 Euro Disney 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 2003, Jay Rasulo - who had opened the new Studios, was promoted to greater things within the company, 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 which had failed to realise its potential had all combined to damage the profitability 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.