Disney World Introduces Parking Fees. What’s The Big Deal?

Disney introduced new parking fees last month. Guests of Disney World resorts will now pay a daily parking fee ranging from $13-24 per vehicle depending on which level of resort they select. As soon as the announcement was made, Disney fans took to the internet to voice their displeasure. Some even proclaimed they were “done with Disney.” Was the response warranted? What’s the big deal about parking? Today’s post shares my thoughts on the new rule and what it could mean for future trips to Disney World.

So let’s start with details on the new fee. Guests of Value Resorts, such as Pop Century or the Art of Animation, who choose to drive to Disney World will now be charged $13 a day to park their vehicle on resort property. Guests of the Moderate resorts, like Port Orleans will pay $19 a day. Those opting for a Deluxe Resort, such as the Contemporary or the Beach Club, will pay $24 a day for standard parking or $33 for valet. The new fee applies to all reservations booked with Disney after March 20, 2018, regardless of when you are traveling. In other words, if you booked your vacation in January of this year, but aren’t planning to travel until June, you will not be charged the additional fee if you bring a vehicle with you. (at least for that trip!).

Other exceptions to the fee include season pass holders, who are currently exempt, and day guests to resorts, such as those visiting for a dining reservation. (At least you won’t have to pay twice if you stay on property and want to eat elsewhere!) Those that pay for resort parking will still get “free” parking at the theme park lots, if they choose to drive instead of using Disney transportation.

Clear enough? Lots of hotels charge for parking these days, right? Perhaps too many of them, but it’s hardly a surprise. So why the outrage?

I can think of a few reasons. First, parking used to be “free” which is really saying it was already included in the price to stay in a Disney resort. A lot of the surrounding hotels charge parking fees too, but their rates tend to be lower than the Disney resorts for a comparable (or greater) amount of space. Second, the new fee follows a rate increase for hotel rooms and tickets that Disney already implemented this year. We’ve pretty much come to expect annual price hikes from Disney, and most entertainment venues really, but the timing of it relative to this new fee added some sting. Third, the parking fee introduction fuels visitors fears that Disney will continue charging more for (hate to say it!) less.

Some of these changes are subtle and limited to select guests, but collectively they cause long-time Disney visitors (and some that have never visited!) to worry about being “priced out” of the Disney park experience.

So why would Disney do this? Why charge for parking when spaces are plentiful? Didn’t they know guests would complain?

I don’t work for Disney and I never have, so this post is just my opinion as an outside observer and long-time Disney fan. Like some of the other things or people I love, I can love Disney without always loving what they do! Here are my best guesses on the subject.

(1) Theme Park Revenue is King

The parks business is one of the primary money-makers for Disney corporate at the moment. Operating income from parks and resorts increased 21% in the last quarter of 2017 according to Disney’s latest earnings report. Every other sector was flat or negative. Disney attributed the growth to increased attendance and spending at their U.S. based parks specifically.

In my old marketing classes, they called these types of ventures “cash cows” because they provide the reliable income that can fuel other endeavors. Other business interests in this particular exercise had names like stars (like Disney’s movie business lately) or dogs (ESPN on cable). I didn’t make up the terms and I’m not even using them 100% accurately, but you get the idea. In every collection of businesses or product lines there tend to be ones that currently make money, ones that cost a lot now but could make money later and those that were either never profitable or on their way to becoming less so.

Disney is making money from their U.S. parks business right now, but the company is also heavily investing in expansion (you can read details here.) The pay off for this new investment is a few years off however, so it’s likely that Disney will seek ways to increase revenue in the interim.  Parking fees fit this need because the cost to implement is minimal and the immediate return is crazy high.  (Rough Estimate: 20 resorts X 300 cars X $19 average cost per car X 365 days = GOBS OF CASH)

(2) They can

Another reason Disney keeps increasing prices is because they can. The Disney brand has a powerful pull and some guests are willing to pay whatever it costs to attend. Prices increased at Disney World last year and attendance did too. I’m sure it’s a balancing act to determine just how much guests are willing to pay for their vacations, but lately Disney seems to be nailing it.

Perhaps timing also comes into play with the new fee. Most hotels near Disney, including those affiliated with Universal Studios, charge for parking. Although it may not feel like an optional fee for those that are unable or prefer not to fly, the parking fee is limited to guests that bring their vehicles with them. This follows Disney’s trend of testing additional fees for services that apply to a portion of guests rather than everyone.

(3) Captive audience

Another reason Disney is charging for parking is to encourage guests to leave their cars at home. If you don’t have a car on property, it means you’re less likely to drive to Universal Studios or other entertainment options close to Disney. It also means you’re less likely to stock up on groceries from Walmart, hit the outlets for souvenirs or drive to a non-Disney restaurant for dinner. In other words, you’ll spend more vacation money at Disney. (See reason number 1 above.)

Yes, you could still catch a ride with Uber or have groceries delivered to your resort room, but many guests won’t want to take these extra steps. Honestly, some people happily immerse themselves in the Disney bubble for their entire vacation and don’t mind paying extra to do so.

(4) Laying the ground work for Star Wars: Galaxy’s Edge

This last one is kind of a mix of the previous three reasons. Disney plans to open the highly anticipated Star Wars: Galaxy’s Edge next year. The crowds will be massive. Really. No question. Consider how crazy the lines have been for the attractions at Animal Kingdom’s Pandora: World of Avatar. This new section of the park was based on a popular movie, but one that opened in 2009 and has no where near the broad appeal of the Star Wars franchise.

I have secret dreams of riding Flight of Passage in Pandora all by myself over and over again once the new Star Wars area opens and crowds flock to Hollywood Studios, but it’s probably not going to happen. (sigh)

The Disney statisticians no doubt have a better grasp on expected crowd volume than I do. Some of this tinkering with pricing, fees and services and is to help get them ready. Price elasticity of demand, another term from my dusty mental archives, measures how consumer demand changes relative to price. They know some fans will be willing to pay whatever it takes to get a chance to live out their Star Wars fantasies (Exhibit A: New Star Wars-themed hotel!)  Luke warm fans (no pun intended!) or non Star-Wars fans will be less so. You can bet the company will test their price elasticity and maximize this opportunity.

If you were running a business that had the same kind of appeal, what would you do?

So what does it mean?

Well, it means the new parking fee is really bigger than just a new line item on your Disney resort bill. It’s probably a sign of more to come. It’s about building revenue, using the powerful Disney brand, investing in future attractions and gauging just how much guests are willing to pay for their vacations.

Some guests have already declared the pricing is too high. I’m curious to see if the guests complaining loudest about the fee will really choose to stay home. I suspect it won’t impact attendance as much as the vehement language on line suggests.

It does raise the question of what will effect attendance though. Would you change your plans if Disney added other fees, like a surcharge for Magical Express transportation, a cost for FastPass+ or a new fee for the previously included Magic Bands? I don’t think any of these possibilities are too far-fetched. Maybe they’ll decide to limit the new gondola to select guests or restrict access to Star Wars: Galaxy’s Edge through ticketed events.

We’ll see. For now, I’m cautiously optimistic. There are always ways to save on your Disney vacations. And so far, many of the new fees are limited to select groups. As I’ve said numerous times before, you can still have an awesome Disney vacation without piling on the “extras” (tours, ticketed events, meal plans, etc.) however attractive those “extras” may be. Plus, the costs are going up because there’s a whole lot of awesome stuff in the works! Maybe it will level out in the end?

Even if you can’t get to the parks there’s no reason you can’t feel the magic of Disney at home! Crank up a silly song. Watch that Disney movie you loved as a kid. Try out a new craft with your kids or loved ones. “Magic” is a state of mind. Why not let yours go there for a bit today?

It’s free to dream big! Add a little magic to your world!