Insofar that Lucasfilm is a wholly owned subsidiary of Disney, all of Lucasfilm profit and loss flows through Disney’s balance sheet. Lucasfilm operates independently in regards to budgeting, so if R1 or Solo come in over budget and that effects net profitability that directly hits Disney’s bottom line as Lucasfilm doesn’t have independent financial disclosure. So does it matter? Yes, it’s a pass through but still has an economic impact. It’s not Disney paying for the production, it’s LF. Does that go somewhat towards answering your question or have I made a hash of it?
It it is true their are economics of scale overall that can help keep film production costs in general down with Disney properties making so many live action films per year.
Thanks Bryan, as concise as usual. I was in an interesting discussion over British FIlm tax breaks , and how they have massively increased film production volumes in the UK over the last decade in particular . Of course Marvel , Lucasfilm and DIsney represents a solid chuck of that business.
The investment structure where a film production was often pulled by a studio if the production fell behind because the budget was exceeded doesn't apply , given that Disney as the parent company acts as a guarrantor that the film will be completed ,no matter what (not that Lucasfilm or Marvel are short of capital).
So the production studios ie Lucasfilm are not hit with the usual ruinous financial penalties ,once they go over budget, as all of the costs of making the film are covered by Lucasfilm ,as is the tax relief that gets credited back to them via the UK, which is well into the millions on many productions.
Being separate financial companies helps maintain those advantages, and although the overall cost of making the movie does increase, it isn't at the incredibly inflated interest charges that are often applied when the backers have to find more cash to complete the filming.Hence all the reshoots.
Overall the tax relief on film production in the UK over the last decade has been an incredible success story and I imagine it will continue for many years more.
I'm not so sure about the positive success of Solo though. I had hoped some of those ground vehicle designs on set would be replaced with digital ones , but it looks like they are going to be in the film.And if they were ever going to do a movie like this then I'm guessing it has to be now, before IX is released, as I anticipate that both Chewie amd the Falcon wil be the last sacrifice the OT can make for the NT ( given that Kylo hates that ship so much) In the several plot outlines for IX I did it was the only way to get any truely hard emotional beats into the movie, given who we are left with , though in a couple of others the new cast also paid a pleasingly heavy price as well.