Disney’s $300 Million Tax Write-Off

Today, Josh D’Amaro, Chairman of Disney Parks, Experiences, and Products, spoke at JP Morgan Global Technology, Media & Communications Conference.

Star Wars Galactic Starcruiser Tax Write-Off

During the event, he was asked about last week’s announcement regarding the Star Wars Galactic Starcruiser closure at Walt Disney World. Josh D’Amaro took some time to address what a unique, interactive, and innovative experience it was (and is…at least until it closes later this year).

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He then proceeded to say, “It didn’t perform exactly like we wanted it to perform. Despite the fact it was a never before seen experience and raised the bar, we thought it was time to sunset this in September.” Then D’Amaro mentioned Disney would accelerate depreciation on the Star Wars Galactic Starcruiser hotel by $150 million in both Q3 and Q4 2023. This would allow the Walt Disney Company to take a significant tax break on the property.

About Starcruiser: "It didn't perform exactly how we wanted it to perform, so we decided to sunset it this September," Josh D'Amaro said on Monday. "In both Q3 and Q4 … we should expect about $100-$150 million in accelerated depreciation." pic.twitter.com/tcfKmUzcaC

— Scott Gustin (@ScottGustin) May 22, 2023

Its Pros

The boutique experience was a unique attempt by the Walt Disney Company to offer a one-of-a-kind immersive adventure for Guests…along with a premium price tag. Carrying an average price of around $5,200 for a two-day, two-night experience, Star Wars Galactic Starcruiser launched on March 1, 2022. After stronger-than-expected sales, the Galactic Starcruiser bookings quickly stalled, forcing the Walt Disney World hotel to look to save costs and boost reservations.

RELATED: Disney to Permanently Close Star Wars: Galactic Starcruiser

Its Cons

After only a little over a year, its demand had significantly decreased. Since it opened, there have been challenges, including financial troubles, budget cuts, high prices, low occupancy, and inconsistent satisfaction levels.

Recently, however, Disney began canceling voyages in the summer with very few bookings, moving Guests to other dates with a 50% discount for the inconvenience. Disney also offered various discounts in an attempt to book up the hotel’s 100 rooms.

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The final voyage for Star Wars: Galactic Starcruiser will take place September 28-30, 2023, and has already sold out. Walt Disney World is contacting Guests booked on the canceled Galactic Starcruiser voyages. In addition, Disney hopes to relocate all Cast Members to other roles at the Walt Disney World Resort.