Is Pixar's recent inability to produce financially successful movies merely a result of the animation studio having bloated production budgets?
For example, Elemental, the studio's most recent release, reportedly cost $200 million to produce. While Turning Red had a $175 million production budget, and Lightyear also cost $200 million to make.
In comparison, Spider-Man: Across the Spider-Verse only cost $100 million to create while Teenage Mutant Ninja Turtles: Mutant Mayhem had a reported budget of just $70 million.
So why are Pixar movies so expensive?
According to CEO Jim Morris, this is because all of the animation at Pixar is produced in-house in the United States, wheras their competitors outsource their animation to studios in Korea, Japan, and other Asian regions.
Morris explained to Variety:
"One of the ways you make these films for less money, and almost all of our competitors do this, is to do work offshore. It’s only us and Disney Animation that makes animation films in the U.S. anymore with all of the artists under one roof. We feel like having a colony of artists approach has differentiated our films. We hope to find a path to make that work. Elemental was particularly expensive because all the characters have visual effects. We had been getting the film costs down."
"The other thing I’ll say about our film budgets is that our whole company exists only to make these films. So when we say a budget, that is everything it takes to run the whole company. Sometimes, the budgets [for other films] that get reported are physical production costs and don’t include the salaries of executives and things like that. Our budgets include all of that, so there’s some accounting context that gets lost. But that doesn’t mean they’re not expensive."
There's a sense of pride in Morris' comments that certainly suggest that the studio won't be altering its position anytime soon. Pixar should be commended for maintaining jobs in the United States rather than lowering expenses by hiring overseas.
Recently, Morris stated that the studio was pleased with Elemental's longevity at the box office and how the film weathered the storm of its disastrous opening weekend numbers.
Yet looking at the production cost for Pixar's rivals, it's painfully obvious that Elemental would be better positioned to reach profitability by cutting costs with offshore animation. It seems likely that a change in policy will at the very least be explored if Pixar and Disney Animation continue to suffer at the box office.