Disney revs its motor with revamped California Adventure

ByABC News
June 14, 2012, 6:48 PM

ANAHEIM, Calif. -- Disney is betting a $1.1 billion tune-up of its Disney California Adventure theme park, including a brand-new 12-acre Cars Land, will put it in the winner's circle rather than stuck in Radiator Springs with a flat tire.

Just in time for the summer vacation rush, Disney on Friday takes the wraps off a five-year project to turn its long-struggling California Adventure theme park into a worthy companion to its storied neighbor, Disneyland.

California Adventure is a theme park Disney opened 11 years ago in Anaheim, Calif., directly across from Disneyland. It's a sister park to Disneyland — much like Epcot Center is to The Magic Kingdom at Walt Disney World in Orlando.

It features rides and attractions to celebrate California's geography, including its famed forests, to its diverse culture and history, including film-making and the ocean.

The park was designed to lure Disneyland visitors to extend their stay from just a day or two and hopefully stay in Disney hotels nearby. Despite the high hopes, though, California Adventure has long failed to resonate with visitors or generate the financial returns the company expected.

Now, a major overhaul to the park represents a gamble by Disney to invest heavily in its worldwide collection of theme parks. New attractions, Disney is betting, will allow it to boost ticket prices as theme park spending creeps back.

Disney poured the $1.1 billion into upgrading the park and getting to the level visitors expect. The biggest investments went to building an entirely new entrance designed to look like Los Angeles did when Walt Disney arrived in the 1920s. California Adventure is also getting an entirely new "land," called Cars Land, sporting a themed racing ride and two other rides all tied to the Disney-Pixar movie Cars.

The California Adventure gambit will be one of the first large-scale tests of Disney's strategy to get consumers to open their wallets even wider if given inspiration. Even before the revamped California Adventure park opened, Disney in May announced large increases in ticket prices for its California parks. Single-day "Park Hopper" tickets were bumped up 19%, meaning it costs $125 for just one person to spend a day at California Adventure and Disneyland.

"Ticket prices are up because Disney expects this (remodeled California Adventure) to be wildly popular," says Robert Niles, editor of Theme Park Insider. "Demand will justify the higher price."

Disney's gamble in California comes, though, amid renewed fears about the economy, unemployment and consumer confidence. Theme park attendance in North America grew 2.9% last year, but largely due to a Disney rival: a new Harry Potter theme park at Universal Studios Florida, according to industry trackers Themed Entertainment Association and AECOM. Excluding the Harry Potter park, attendance rose a more anemic 1.6%.

Disney is looking to jump-start visits and ticket pricing by investing despite the uncertain economy. Along with the ambitious expansion at California Adventure, Disney is spending $500 million over this year and next to upgrade Fantasyland at Walt Disney World in Orlando, according to a report by Michael Morris at Davenport. Part of that upgrade also opens up this year along with price increases there.