Summary
Pixar's high movie budgets include salaries and other costs, which are often overlooked in accounting. However, their films are still expensive.
Pixar's blockbuster film, Elemental, had a daunting price tag of $200 million, yet it faced initial difficulties at the box office. Nonetheless, the movie eventually managed to break even. Despite these recent struggles, Pixar remains optimistic about its future releases and is determined to regain its position of achieving both critical acclaim and commercial success.
Pixar's president, Jim Morris, recently discussed the misconception surrounding the high cost of Pixar movies. The renowned animation studio has produced numerous successful computer-animated films since 1995's Toy Story, many of which have had significant budgets. However, due to the pandemic, Pixar has faced mixed box-office performances with films like Lightyear and Elemental. Notably, Elemental cost approximately $200 million, making it one of the most expensive animated movies. The large budget posed a challenge for the film's success at the box office, although it did gain momentum after a slow debut week.
In an interview with Variety, Morris addressed the narrative surrounding Pixar's budgets. He explained that Pixar and Disney Animations are the only American studios creating animated movies, with all the artists working together. Consequently, Pixar's budget includes costs such as executive salaries, which often go unnoticed. Morris acknowledged that their movies remain expensive, despite these considerations. Here is his comment:
"There's some accounting context that gets lost. Our budget includes various costs, like executive salaries. Although our movies are still expensive, it's important to consider the bigger picture."
That question is always on our minds. One of the strategies we use to reduce costs in making these films, which is also common among our competitors, is outsourcing certain tasks offshore. However, it is worth noting that only Disney Animation and ourselves continue to produce animation films in the United States with all of our artists working together in one location. We believe that this approach of having a community of artists sets our films apart. We are determined to find a way to sustain this approach. The production of "Elemental" was particularly costly due to the extensive visual effects required for all the characters. Nevertheless, we have been successful in lowering the overall costs of our films.
Another aspect worth mentioning is that our entire company is solely dedicated to the production of these films. Therefore, when we refer to a budget, it encompasses all the expenses required to run the entire company. Sometimes, reported budgets for other films only include the physical production costs and do not account for salaries of executives and other related expenses. Our budgets, on the other hand, encompass all of these costs, providing a more comprehensive accounting perspective. However, this does not undermine the fact that our films are still expensive.
Will Pixar Be More Reasonable About Their Movie's Budget?
Elemental achieved breakeven at $425 million, but Pixar took a significant risk with a $200 million budget. This raised concerns about budgeting and the most profitable investment. To provide context, Teenage Mutant Ninja Turtles: Mutant Mayhem had a reported budget of $70 million, Spider-Man: Across the Spider-verse ranged between $100 and $150 million, and The Super Mario Bros. movie was around $100 million. Despite having nearly half the budget of Elemental, these animated films achieved instant box-office success without any obstacles.
Though Pixar Studios has released an animated film annually since its inception, these films have incurred substantial costs. Some of the most expensive Pixar films exceeded $200 million in production budget, while others were in a similar range. While the studio has previously recovered these high costs, the pandemic had a significant impact. Films such as Turning Red and Soul were released directly on Disney+, and even though Pixar films have returned to theaters, they have struggled at the box office. This may necessitate a reconsideration of budgets for future projects.
Despite recent setbacks, Pixar is poised for a fruitful year with a plethora of highly anticipated releases on the horizon. Despite receiving a mixed response from both audiences and critics, the renowned studio is determined to reclaim its previous triumphs and regain its reputation with an array of thrilling upcoming projects.
