Hollywood's dimming prospects amid China's cinema crackdown
American movies disappearing from Chinese theatres? It’s possible, but there were so few of them that Hollywood certainly won't collapse because of it.
The U.S. trade war with the rest of the world is intensifying. It seems it isn’t going quite as Trump imagined: that after his threats and announcements of high tariffs, countries would come begging for mercy. Many players on this board do not intend to bow to the power and are even promising significant retaliation.
The Chinese dragon breathes fire
The most important of them seems to be China. Right after the announcement of American tariffs, they rolled out heavy artillery, announcing high retaliatory tariffs and restrictions on exporting rare earth metals to the USA, which are essential for the American economy in producing modern devices.
A new cultural debate emerged after this exchange of blows, specifically related to cinema. Questions arose about whether the trade war would limit or end collaboration between the countries regarding film distribution. China is already threatening to employ various tools that limit the profits of American companies, and banning Hollywood films can be done easily. Entities under party control essentially control distribution in the local market.
Chinese youth may suffer significantly from being unable to watch films with American superheroes in their local theatres. Still, their producers, cut off from a massive market, will suffer even more. There is logic to this thinking, but it’s crucial to make an essential caveat that seriously weakens arguments about the impending financial disaster for Hollywood.
Profits at the level of peanuts
This simple caveat: American films are already relatively few on Chinese cinema screens and do not bring Hollywood the desired stunning profits. Their disappearance will not result in a repertoire or attendance catastrophe in the Middle Kingdom.
It seems that today’s share of American cinema in the Chinese market is not a crucial element of the economic play between the superpowers. This situation has been a source of frustration and disappointment for Hollywood for years. This time, however, it may prove to be a significant relief: there have been no massive profits, and there will not be massive losses either.
Almost a year ago, the critical industry magazine "Variety" sounded the alarm: "For the past four years, Chinese audiences have shown little interest in Hollywood films." You can find numbers confirming this conclusion in the Statista service, which publishes detailed market data. In 2024, as much as 85% of the Chinese cinema repertoire was local productions. Only 76 titles came from abroad, with a market share of 21% - and it should be noted that this number includes productions not only from the USA but also from other countries, such as popular Japanese and Korean animated films or Bollywood titles. Considering this, it turns out that the American share in the Chinese film market did not even exceed 4%.
This is a drastic decline compared to previous years, when Hollywood could boast double-digit results. The analyses of this phenomenon show that the main reasons are political and economic tensions between China and the USA and an increasing Chinese trend towards domestic big-budget blockbusters.
- The trade war with China couldn’t have come at a worse time for Hollywood - comments and confirms Tomasz Raczek, journalist and film industry expert. - Hollywood films have recorded worse attendance results in China for several years. The reason is twofold: firstly, Chinese authorities repeatedly counter American blockbusters on their screens with their productions, and secondly, lately, Hollywood has been unable to produce new, truly interesting, and unique film spectacles that aren't sequels or repeats. Hollywood is experiencing a crisis, and the trade war with China can only deepen it.
Swan song in Minecraft
The American industry sought a chance to reverse this trend with the upcoming premieres of big, essential titles. And there was something to it - just a few days ago, "Minecraft: The Movie" indeed broke the Chinese bank: during the opening weekend, it made almost CAD 15 million and jumped to first place in the box-office, ending the streak of the local hit "Ne Zha 2," which was at the top of the sales list for over two months. However, it looks like - at least until the trade war escalates - this could be the swan song of Hollywood cinema in China.
- And Hollywood had high hopes for the rest of the season - adds Krzysztof Spór, film critic and market observer. - In the summer, several big productions were set to hit Chinese theatres, including the next part of "Mission Impossible." Some even claimed that these titles could bring Hollywood significant profits in China, comparable to years ago. This is unlikely to happen, assures the expert.
- There is an even bigger problem related to the trade war. However, only indirectly with China: since there are significant changes on the horizon in the global economy, the natural tendency will be the desire or necessity to save. And what do people save first? Naturally, on pleasures and entertainment. Stock markets are reporting declines; large cinema chains are already dreading ticket sales in the coming months; Disney is loudly expressing concern about the profits of its large amusement parks. This could be a serious industry problem, and since Trump is essentially at war with it, he certainly won’t care - added Spór.
