Lemon Laws

If you were hoping for new model Cars to hit the showroom next fall, don't wait for a test drive. Disney (NYSE: DIS  ) and Pixar (Nasdaq: PIXR  ) announced that they would be delaying Pixar's next full-length animated feature by eight months to cash in on the potent summer crowd come 2006.

Cars is the last original flick due to Disney in a deal that finds the companies splitting the production costs as well as the profits. The move adds cruel buckets of sand to the hourglass that marks Pixar's eventual emancipation from a contract that it has long outgrown.

However, it shouldn't have come as a complete surprise. After trouncing its third-quarter profit targets last month, Pixar let a trial balloon fly during its conference call when it revealed that it was leaning toward a summer release schedule instead of its historical holiday season debuts. It pointed to the success of its lone summertime rollout -- Finding Nemo -- and hinted that its first post-Disney film was likely to be held back until the summer of 2007 over the more logical summer of 2006 release.

It has to be frustrating. With DreamWorks Animation (NYSE: DWA  ) having no problem loading up the multiplex with two computer-rendered films every year, why should Pixar have a dry 2005?

Sure, a summer debut makes sense. It's a timely automotive release as families prepare to load into their own cars for road trip vacations. More importantly, it feeds the lucrative home video launch into the active holiday shopping season.

Yet with Pixar now having spaced its last few releases 18 months apart, will shareholders be annoyed that the throughput is happening three times faster at rival DreamWorks? Pixar has been a winning Motley Fool Stock Advisor newsletter recommendation, but how forgiving will investors be when Pixar eventually coughs up a dud and that hourglass trickles a year and a half of desert sand before the next bit of celluloid comes around?

You can't rush quality, and Pixar's track record -- an enviable six for six on the animated feature front -- vindicates the company's slow hand. But let's cut through the sugarcoated drivel. Five of those hits, including the current smash hitThe Incredibles, have had no problem with November introductions.

Pixar claims that it has not had any production delays, so why extend the breakup process? What does the extra time buy, beyond the possibility of upsetting Pixar's profit models in the near term? It would be naive to expect that delaying the eventual separation may be the seed to an eventual reconciliation. Yet any budding conspiracy theorist would be nuts not to note that the extra time may allow Pixar to lend a hand to the controversialToy Story 3 project or see whether an agreeable face ultimately replaces CEO Michael Eisner at the helm in 2006.

What do you think Pixar should do? Why is the next film being delayed? If DreamWorks is putting out two new features a year, why can't Pixar? All this and more -- in the Pixar discussion board. Only on Fool.com.

Longtime Fool contributor Rick Munarriz owns all of the Pixar releases on DVD. Yes, he owns shares of Pixar too -- and Disney. He is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.


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