For fireworks companies, this July 4 is proving to be a dud
Across the country, the coronavirus pandemic has brought to a halt a tradition of summer: Fourth of July fireworks.
As many as 80 percent of community fireworks displays in large cities and small rural towns have been canceled this year over fears they would create a social distancing nightmare.
For the 150 companies across the country that thrill spectators with their booming, colorful explosions in the sky, the two weeks around the July Fourth holiday make up about three-quarters of their revenue.
The numerous cancellations this year, they say, are taking a significant financial toll on their businesses, many of them family owned for generations.
With July Fourth falling on a weekend, giving communities extra days to host events, “we were looking at a record year,” said James Souza, the fifth generation of his family to operate Pyro Spectaculars by Souza from California. “But of the 400 shows we expected to do around the holiday, we’ll be lucky if we do 40,” he said, noting he had been receiving daily calls with cancellations or program changes from event planners.
Included in the 40 shows that Souza will produce this year are the Mount Rushmore show in South Dakota and, for the 36th consecutive year, the Macy’s fireworks show in New York.
The Macy’s show has been changed to five-minute displays in undisclosed locations throughout the week that are designed to be watched from outside without leaving home. The grand finale on July Fourth, also from an undisclosed location, will be televised.
A few companies that specialize in large fireworks displays also sell Roman candles, spinners and sparklers for individuals to use in their backyards, a business that is booming this year. But it also has created headaches in cities like New York, Chicago and Los Angeles, where fireworks are illegal. In Utah, a person setting off fireworks sparked a wildfire over the weekend and forced evacuations of homes 30 miles south of Salt Lake City.
Some of the fireworks display companies have, over the past decade or so, branched out to broader entertainment arenas, creating “oohs” and “aahs” at major and minor league baseball stadiums as well as complex pyrotechnics for rock concerts, music festivals, and indoor basketball and hockey games.
The vast majority of those sports games and entertainment events also were canceled this year. When they ultimately resume, they initially may do so without spectators, making fireworks unnecessary.
“I’ve had days where I’ve lost $150,000 of business from cancellations,” said Roberto Sorgi, the fifth generation of the family that runs American Fireworks in Hudson, Ohio. “We’re going to lose 50 to 75 percent of our business from the Fourth of July, and there are no clear signs of when concerts or mass gatherings will be allowed again, so we may not have a third or fourth quarter this year. It is a very scary road ahead for all of us.”
Most of the fireworks companies received money through the federal Paycheck Protection Program and the Economic Injury Disaster Loan program.
But they said it wasn’t enough. That’s because the fireworks industry has a ton of upfront expenses. The companies start buying millions of dollars’ worth of fireworks nearly a year in advance and pay hefty insurance premiums to cover the planned events.
“I’m sitting on millions of dollars, tons and tons of explosives, that have to be stored very specifically,” Souza said, “which, for us, is in 24 military-style bunkers that we have to lease, and those leases are now at a premium.”
He added: “We’ve maxed out all of our lines of credit. I don’t know how I’m going to cover expenses this year.”
The industry hopes Congress will earmark $175 million for it in another stimulus bill, if one is passed.
Stephen Vitale, the fourth generation of the family to run Pyrotecnico in New Castle, Pa., said about 160 of the 600 shows he expected to do this Fourth of July would happen.
“The first 15 days of May were incredibly devastating,” Vitale said. “Every call was a bad call, a cancellation.”
Noting that many clients are municipal parks and recreation departments and that an 18- to 20minute show can cost anywhere from $5,000 to $200,000, Vitale and others are worried about what may happen next year.
“Right now, the cancellations are pandemic-driven,” he said. “But next year, I believe it will be more money-driven. Budgets are going to get cut.”