Vancouver will lose more than 2,000 film jobs and over $80 million in Hollywood investment as a result of Twentieth Century Fox’s decision to move X-Men franchise movie The Wolverine to Sydney, Australia. X2: X-Men United (2003), X-Men: The Last Stand (2006) and parts of X-Men: Wolverine (2009) were all shot in Vancouver.
“We moved from Vancouver for economic reasons,” Fox line producer Joe Caracciolotold Sydney media at a press conference April 20, according to a report by Screen International.
“More and more there is pressure on the costs of pictures,” Caracciolo said, “and the numbers were not adding up [in Vancouver].”
Specifically, Vancouver’s film incentives weren’t adding up to compete with the aggressive deal the Australian government offered the film’s producers: a payment of nearly $13 million, which effectively doubled Australia’s film incentive program in a one-off “super incentive.”
Australia estimates that the production will bring more than $80 million in investment to the country and create approximately 2,000 film jobs plus up to 1,500 indirect jobs in catering and other industries.
Vancouver’s loss of the large franchise production follows news that Ontario, with a rich taxpayer-funded film credit applied to all aspects of a film’s production that has been in place since 2009, has surpassed B.C. as Canada’s largest film jurisdiction and is starting to scoop up some of B.C.’s Hollywood work. (See “Ontario film industry outperforming B.C.’s”– issue 1169, March 20-26.)
The loss of The Wolverine to Australia begs the question: is B.C. still competitive in an increasingly global battle for film productions?
Peter Leitch is chairman of the Motion Picture Production Association of B.C. and president of North Shore Studios and Mammoth Studios.
He argues that B.C.’s film industry is still competitive – where it counts.
“We do work closely with government to make sure that we maintain competitive tax policy, but the bottom line is, there’s always going to be a jurisdiction that can underprice you,” he said. “I guess the question is: should we be competing against that? And I would answer: no.”
Leitch said B.C. has successfully created a sustainable industry with strong crews and infrastructure and reliable film incentives. He argued that adopting Australia’s approach of offering a one-off incentive to a specific production isn’t a good business practice vis-à-vis B.C.’s long-standing Hollywood clientele.
“We’ve had loyal customers that have been here for the last 25 years,” he said. “For another company to come along and [B.C. to] offer a special incentive – I don’t know if that really makes sense in some ways in terms of building an industry.”
Leitch added that targeting specific shows rather than supporting an entire industry could undercut film infrastructure investment.
“If we [at North Shore or Mammoth] want to build a studio, we’re not going to build it for one particular production. And if there’s uncertainty of what the incentives are going to be from production to production, that doesn’t give you a very good sense that you’re going to attract a sustainable industry.”
Robert Wong is vice-president of tax credits and development for B.C. Film + Media, which administers film tax credit programs for the province.
He said that producers looking at filming in B.C. are increasingly haggling for sweeter deals – and asking B.C. to match offers from other jurisdictions.
“We basically say, ‘We don’t give one-off deals – we don’t have ‘Macy’s Day sales.’ We say that here’s the program which is offered to all eligible productions, and we feel it’s a fair program and it’s competitive, but we will not make deals.”
Wong said jurisdictions that offer extra-rich incentives and one-off deals often fail over the long run.
“You’ve also seen the demise of a number of U.S. programs that have been offering very generous programs,” he said. “So it kind of speaks for itself.”
In losing The Wolverine, has B.C. lost the more than 2,000 film jobs and millions of investment dollars that Australia claims to have landed?
“It’s kind of impossible to assess,” Wong said. “But if that [production] walks away, there is another production that’s waiting to take its place.”
Wong added that he doesn’t expect the loss of The Wolverineto dramatically diminish this year’s film spending in B.C.
“The landscape for production in British Columbia is very good, and there’s been a shift in the type of work coming to British Columbia – there’s a lot of visual effects and animation work being done here,” he said. “I think at the end of the day, [the loss of The Wolverine] is probably not going to make a big difference in the bottom line.”
Twentieth Century Fox did not respond to interview requests by press deadline.
The Wolverine is scheduled for release in July 2013. •
