Atlantic City casinos are threatened by the opening of the eight new gambling destinations in the Northeastern US.
Atlantic City casinos will suffer from the addition of eight new casinos in the Northeast area, forecasts Moody’s report. The upcoming launches will make it even harder for Atlantic City casinos to survive on the already over saturated market. However, the expansion will greatly benefit gambling tool manufacturers.
Bad for existing Atlantic City casinos but good for manufacturers
“By the end of 2018, eight casino projects worth $5 billion are due to open in New York, Massachusetts, Pennsylvania and Maryland,” says Moody’s research. These new casinos will have a hard time to gain share. The report adds that existing casino’s “have already been struggling to adapt to flat revenue growth amid new entrants.” On the other hand, as there are fewer casinos, some of the remaining units’ revenues are increasing. But the new gambling destinations might draw their visitors.
The winners of the situation are game and equipment manufacturers, which “have been hit by slowing gaming revenue as existing casinos delay replacing older machines,” said Peter Trombetta, Moody’s Analyst. The list includes such companies as Game Technology, Aristocrat Leisure and Scientific Games Corporation. Their revenues will be boosted by the upcoming investments as “the new casinos will be ordering some 20,000 new slot machines.”
Atlantic City casinos can still rely on summer traffic
Trombetta says that location plays the biggest role when two casinos have similar services. “It’s very unlikely someone is going to drive past one casino to go to another casino if they similar offerings.” Atlantic City casinos will still benefit from summer-traffic, thanks to the Jersey Shore.