Nov. 28 (Bloomberg) -- Twenty-year-old Washington D.C. resident Elvish Scheible flew to New Zealand for today’s film premiere of “The Hobbit: An Unexpected Journey,” hoping her elven-queen costume will catch the eye of star Cate Blanchett.
Scheible, who changed her first name, is among thousands of fans and locals lining half a kilometer of red carpet in the capital’s Courtenay Place to celebrate the return of a film franchise that’s already brought more than $580 million in movie business and tourism to New Zealand. Nine years after director Peter Jackson unveiled the final movie in his three-part “Lord of the Rings” saga here, actors including Blanchett and Elijah Wood are adding glitz to the start of a new trilogy.
“When it’s over, I’ll probably fall over from exhaustion and happiness,” said Scheible, near the edge of the red carpet. “I’ve been looking forward to this for a long time.”
The film begins a three-part prequel to the “Rings” films that will keep New Zealand’s mountains, rivers and forests in front of global cinema audiences until at least 2014, when hero hobbit Bilbo Baggins returns home with his share of dwarven treasure, wrested from the dragon Smaug. With a near-record-high currency deterring visitors and $25 billion of earthquake damage to clear up, any boost from the film is welcome, said Darren Gibbs, chief New Zealand economist at Deutsche Bank AG.
“It’s a series of running advertisements for New Zealand,” said Gibbs by telephone. “If you haven’t heard of New Zealand by now, you probably will never hear of us.”
The economy will grow 2.6 percent this year, according to the median forecast in a Bloomberg survey of economists last month. The so-called kiwi has risen 9 percent in the past year, the biggest gain among the Group of 10 economies. Retail sales fell and the jobless rate climbed to a 13-year high in the third quarter, adding to signs of a slowdown.
The exchange rate helped tourism’s share of total exports in the year through March fall to the lowest since records began in 1999. Last week, the government cut its forecast for future visitor spending, projecting 11 percent less in 2014 than previously predicted.
“The high New Zealand dollar and fragile global outlook threaten to considerably dampen tourism spending,” Mark Smith, senior economist at ANZ New Zealand Ltd., said in a Nov. 22 research note.
That’s made the effect of the new film trilogy even more vital for the industry, according to Air New Zealand Ltd. Chief Executive Officer Rob Fyfe.
“The Hobbit movies will be hugely important to New Zealand’s tourism industry in the next couple of years,” said Fyfe, whose airline’s safety video has staff in Hobbit-style costumes on every flight. An Air New Zealand plane, painted with the film’s characters, flew over the red-carpet event, raising cheers from the crowd.
The films are also set to increase sales for Warner Bros.’ New Line Cinema and Metro-Goldwyn-Mayer Inc. as they compete with other Hollywood studios for rising box-office receipts. The series may help Los Angeles-based MGM, which emerged from bankruptcy in 2010, demonstrate it can produce hits after saying in July it was considering an initial stock sale.
“The Hobbit: An Unexpected Journey” is scheduled for release in the U.K. on Dec. 13 and in the U.S. the following day as part of a global rollout next month. It’s expected to yield $475 million in ticket sales in the U.S. and Canada, according to researcher BoxOffice.com.
Visitors to New Zealand inspired by the movie will find the local currency has doubled in value since the first Rings film opened 11 years ago. The kiwi bought 82.17 U.S. cents at 5:38 p.m. in Wellington today.
Prime Minister John Key, a former head of foreign exchange at Merrill Lynch & Co., promised Warner Bros Productions Ltd. as much as $25 million in subsidies in 2010 to film the movies in the country after the studio demanded incentives to offset the currency’s gain. He flew to Los Angeles last month to boost his nation’s film industry, dining with “Avatar” director James Cameron and other Hollywood studio chiefs. After the dinner, Key said he would review subsidies offered to foreign makers of television programs to help counter the kiwi’s gain.
The Rings trilogy, based on the books of author J.R.R. Tolkien, boosted New Zealand’s economy by more than NZ$700 million in the first half of the last decade, according to New Zealand Institute of Economic Research and Statistics New Zealand. The world premiere of “Return of the King,” the final Rings film, attracted more than 100,000 people to central Wellington in December 2003.
Wellington International Airport Ltd. has hung a giant statue of the slimy, half-naked creature, Gollum, from the ceiling of the airport’s dining area and painted its luggage carousel with Hobbit imagery. The movie’s release will boost visitors from as far as the U.S. and Europe, Tourism New Zealand Chief Executive Officer Kevin Bowler said in a Nov. 22 statement.
Today, Blanchett and Wood, who reprise their “Rings” roles in the film, will join Jackson and other stars passing below a nine-meter statue of Gandalf the wizard as they head to the 88-year-old Embassy Theater in the capital, which hosted the first showing of “Return of the King.”
Spectators on a balcony at The Grand, a three-level bar and restaurant on Courtenay Place, have prime views of the red carpet’s stars. The floor was booked for a private function before the date of the premiere was confirmed, manager Ryan Mann, 30, said in an interview on Nov. 23.
“We perhaps could have got more out of that booking than we did,” he said.
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