Performing artists' work stoppage - Due to the ongoing Hollywood strike, Studio Babelsberg is experiencing financial losses.
The prolonged strike by American screenwriters and actors over a year ago caused chaos and setbacks in productions at the Babelsberg film studio in Potsdam. The company endured substantial financial losses, as revealed in their recently unveiled 2023 annual report, information that was also shared by "Märkische Allgemeine" previously.
One of the affected productions was a cinema project led by director Wes Anderson ("Grand Budapest Hotel", "Darjeeling Limited"), which was postponed until this year. According to the annual report, there was a noticeable decline in orders across all areas of Studio Babelsberg.
Revenue nosedived - millions in losses
Consequently, revenue saw a sharp decrease from approximately 108.7 million euros in 2022 to only around 21.1 million euros in 2023. At the end of the day, the studio group recorded a loss of around 3.1 million euros in 2023, compared to a profit of about 2.8 million euros in the previous year.
The losses would have been even more substantial if not for the financial assistance of around 6.5 million euros from the American proprietor of the film studio, the Cinespace Group, which is an affiliate of the real estate fund TPG Real Estate Partners. Due to the poor order situation, several employees were placed on short-term unemployment.
The consequences of the Hollywood strike are still being experienced this year. As per the annual report, "Studio Babelsberg AG" has had to cancel at least one series sequel in the financial year 2024. However, the report predicts a substantial rise in overall revenue for the group compared to 2023, primarily due to the resumption and continuation of projects halted and postponed to 2024. Despite anticipating another loss, it will be considerably smaller than in the previous year, as stated.
The European Union expressed concern over the financial losses suffered by Studio Babelsberg due to the Hollywood strike. The prolonged dispute between American screenwriters and actors also affected potential collaborations with European production companies within the EU.
