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Hollywood can’t seem to catch a break in China lately. Just as U.S. studio tentpoles were beginning to return to the country at scale, a COVID outbreak spanning two thirds of China’s provinces is shuttering cinemas and casting a pall over local consumer activity all over again.
Approximately 30 percent of all Chinese movie theaters have been temporarily closed over the past week, according to exhibition industry consultancy Artisan Gateway. The regions hardest hit include major population centers like Shanghai and Shenzhen.
Locally transmitted COVID cases rose on Tuesday by more than 5,000 new infections nationwide. While low by Western standards, the current outbreak represents China’s largest caseload since the pandemic first emerged in Wuhan in 2020. Local officials are scrambling to maintain their “COVID zero” policy of total eradication of the virus, resorting to their usual playbook of mass mandatory testing and the total shutdown of cities comprising tens of millions of residents.
If Beijing leaders fail to get a handle on the infection surge soon, economists warn that China’s growing response could result in major supply chain snarls in the world’s manufacturing base, further jeopardizing the global economic recovery.
Within the movie sector, box office analysts had been looking forward to the China release of Warner Bros’ The Batman on Friday for some indication of the country’s current appetite for U.S. superhero fare. A source close to the film, however, tells The Hollywood Reporter that the latest tracking suggests an opening of just $15 million to $20 million, down from earlier projections in the $25 million to $30 million range.
“Our optimistic assessment is that Warners will be lucky if The Batman opens above RMB 100 million ($15.7 million),” adds James Li, co-founder of Beijing-based film industry market research firm Fanink, which has been tracking the title. “On the pessimistic side, they may be lucky to get half that,” he says. “There are four tier-one cities in China (Beijing, Shanghai, Guangzhou and Shenzhen), and these are the major markets where moviegoers tend to be the most pro-Hollywood — and half of them are currently shut down.”
Domestically, The Batman has earned $245 million, with the worldwide total sitting at about $472 million.
Director Matt Reeves’ take on Gotham’s dark knight is somber in tone and runs nearly three hours long, hence the rather modest original sales expectations. But the film will be the first U.S. superhero movie to open in China in nearly a year and half, after local regulators passed on the release of the last five Marvel tentpoles (Black Widow, Eternals, Shang-Chi and the Legend of the Ten Rings, Venom: Let There Be Carnage and Spider-Man: No Way Home) due to suspected political reasons. Hopes were high that The Batman might give the studios some hint of their former glory in the massive China market.
Sony and Tom Holland’s Uncharted is similarly struggling in China amid the theater closures and diminished interest in U.S. moviemaking. The action adventure film has earned $114 million in North America and $302 million worldwide so far. But it has brought in just $4.5 million in China since its opening on Monday and local ticketing app Maoyan projects it to finish locally with just $13.2 million.
Chinese consumers’ declining enthusiasm for U.S. moviemaking is becoming increasingly unmistakable. After a decade of pulling in enormous blockbuster grosses from China, the only Hollywood films to earn over $100 million in the country in the past two years plus were Legendary Entertainment’s Godzilla Versus Kong and Universal’s F9: The Fast Saga. Meanwhile, more than 20 Chinese titles have sailed past the $100 million mark during that same period, and the very biggest local blockbusters have earned more than $500 million a piece.
Other upcoming Hollywood titles headed to China in the weeks ahead include Roland Emmerich’s disaster action film Moonfall (March 25), Sony’s animation sequel Hotel Transylvania: Transformania (April 3) and Warner Bros’ Fantastic Beasts: The Secrets of Dumbledore (April 8).
“Over the past two years, the Hollywood brand has definitely taken a hit in China — for a variety of reasons related to supply, the actions of authorities and local market dynamics,” says Li. “It’s going to take some time and strong marketing effort to re-engage Chinese consumers around the Hollywood brand.”
There is some concern in the mainland Chinese industry that the plight of neighboring Hong Kong could foreshadow what’s to come if health officials aren’t able to tamp down the current COVID outbreak soon.
The omicron variant arrived in Hong Kong near the start of the year and local cinemas were closed on January 7 as infection caseloads skyrocketed. The suspension came on the heels of a strong box-office recovery in the semi-autonomous city, with Spider-Man: No Way Home taking more than $14 million in just two weeks in December 2021. A month after cinemas were ordered to suspend business, two major multiplexes – Broadway Hollywood and Cinema City Victoria – announced their permanent closure as their leases ended. Although the box office returns in Hong Kong in 2021 showed 125 percent growth compared to 2020, from $69 million to $155 million in total sales, the latest outbreak has decimated the local exhibition business. The theater industry missed out on the lucrative Lunar New Year holiday season in February, and the Hong Kong releases of West Side Story, Death on the Nile and The Batman, originally scheduled for January, February and March 2022, respectively, were all scrapped. The local government has indicated that reopening theaters won’t be considered until at least April 20.
Pamela McClintock contributed to this report.
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