Las Vegas casinos were ordered to shut their doors to prospective customers, as the COVID-19 pandemic is slowly but surely engulfing the US. The government opted for the same measures that were put in place elsewhere, in a desperate attempt to contain the virus threat. For the gambling giants of Las Vegas, this is troublesome news, and many casinos are in danger of going bankrupt. The city relies heavily on the influx of tourists, both domestic and from beyond borders and right now that stream has all but ended.
The 30 day closure likely to be extended
Nevada Gov. Steve Sisolak was the one to announce Las Vegas operators that they had to close all their businesses for 30 days. A month is a long time for the gambling industry and significant losses are expected by those who are in this line of work. Not only the casinos, but also the employees and pretty much anyone involved will be hard hit by these restrictions. The biggest concern is that the 30 day closure is probably only the beginning and Sin City casinos will stay closed for much longer.
With plenty of time on their hands but no customers to sustain their businesses, casino owners are preparing for the worse. The biggest names in the land-based gambling industry are not terribly concerned, because they have the resources to last until the end of the month. The days of liquidity differ greatly from one casino to the other, but the biggest resorts in Las Vegas are likely to weather the storm. With sufficient money to last for more than a year in some cases, they are unlikely to go bankrupt.
Smaller casinos are in serious danger
Gambling operators, large and small are frantically calculating the cash burned during this lockdown. Not surprisingly, the biggest players in Las Vegas are spending millions every day, without an effective way to offset all these losses. The analysts predict that the daily burn will stay the same, unless casinos decided to take more drastic measures. Initially, they are unlikely to lay off employees, but as the losses keep piling up, some casinos are expected to send people home.
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The stunning economic fallout took some of the industry leaders by surprise, even though the warnings were therefore everyone to see. Macau casinos have suffered a similar fate in the wake of the lockdown, but at least for them there’s finally light at the end of the tunnel. Meanwhile, Las Vegas casinos are losing significant amounts, just like the Nevada tourism industry as a whole. With each passing month, this industry loses nearly $5 billion, while on a national level the closure of Vegas casinos causes huge losses.
Las Vegas casinos are counting on the government to throw them a lifeline, but Congress has other priorities at the moment. The future looks rather bleak for the industry and even though the biggest Sin City casinos will weather the storm, many of the smaller players will go bankrupt in 2020.