Times are tough for Las Vegas casinos as for every other sector of the ailing US economy, but that in itself is news because, until this economic downturn, the one place that seemed less affected by hard times was the world’s gambling capital.
“When we look back historically, this is one of the most severe downturns we’ve ever seen,” said industry analyst Brian Gordon of Applied Analysis. “Wall Street is responding much more sharply, but a lot of that is based on concerns about how a global recession will hit gaming and leisure travel.”
The most recent data paints a grim picture that’s expected to get grimmer before it gets better. This September saw 10.1 percent fewer visitors in Las Vegas than September last year, and those who came paid 21 percent less per room night, the Las Vegas Convention and Visitors Authority said. Casinos on the Strip raked in 5.2 percent less in gaming revenue compared to a year ago.
PHOTO: AFP
As a result, the stock market has punished every major publicly traded gaming company. Las Vegas Sands (LVS) is down 95 percent, Wynn Resorts is down 71 percent, MGM Mirage (MGM) is down 88 percent and Boyd Gaming is down 90 percent since last year.
Las Vegas Sands’ shaky position was highlighted earlier this month when CEO and majority shareholder Sheldon Adelson announced layoffs of 11,000 construction workers in Macau, where the company has been building an Asian version of the Las Vegas Strip with plans for eight major hotel-casinos.
The company has also halted construction projects in Las Vegas and Pennsylvania. Adelson, who a year ago was named by Forbes magazine the third-wealthiest man in the US when LVS was riding high, has lost an estimated US$34 billion in the decline.
LVS isn’t the only company feeling the pain. Boyd Gaming halted construction of its US$5 billion Echelon project on the Strip earlier this year and has said it is unlikely to resume at least until late next year. Harrah’s Entertainment and Station Casinos are facing looming deadlines on debt service payments and have halted plans for redevelopment or expansions indefinitely.
MGM Mirage, the largest US gaming company with 10 resorts on the Strip, has shed about 8 percent of its workforce in Nevada, or about 3,200 full-time equivalent positions.
The company is still moving ahead with an US$11.2 billion, five-skyscraper complex on the Las Vegas Strip, but sales of condominium units at the center have stalled. The company took reservations on just 32 of them in the third quarter; about 1,300 remain to be sold.
MGM Mirage also has frozen plans to build a second resort in Macau and to develop a large swath of vacant land at the north end of the Strip.
“What we are experiencing now is unique,” said Alan Feldman, senior vice president for MGM Mirage, referring to consumer confidence levels sinking to historic lows.
“Things weren’t great this year but they were holding their own. Then in July and August we really started to feel some pressure and the bottom started to drop out in September,” he said.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS