Just four months before principal photography was due to begin, director Peter Jackson warned Thursday that Time Warner Inc.'s New Line Cinema will move production of the "The Hobbit"--beset by labor uncertainly--out of the country. New Zealand Actors' Equity union, which had called on actors around the world to refuse to work on the film, appeared to back down after Mr. Jackson's warning, with Actors' Equity organizer Frances Walsh declaring "industrial issues" no longer a barrier.The damage has already been done," said a spokesman for Mr. Jackson's company, Wingnut Films.
Economic and Development Minister Gerry Brownlee agreed. "Sending a message internationally that this was an environment where you have unstable employment relations is absolutely disastrous."
So Mr. Key has stepped up; he and members of his government want to meet with Warner executives here to discuss what can be done to make sure New Zealand doesn't lose the blockbuster. According to New Line spokeswoman Candice McDonough, the California-based company hasn't decided where to make the film; she declined to comment on whether production executives would meet with Mr. Key.
"It's really tragic for New Zealand," said Mr. Key's spokeswoman Jane Fraser-Jones of the possible loss. With an economy that's struggling to shake off the effects of the global financial crisis and a recent earthquake in Christchurch, the country's second-largest city, the government and New Zealand are eager for the investment the film represents. Some economists estimate that the real economic cost of losing "The Hobbit" would far exceed the $500 million budgeted to make the film.
"When you lose these sorts of projects you don't just lose the direct dollar that was going to be spent here," said Cameron Bagrie, chief economist at ANZ National Bank Ltd. in Wellington. Indeed, Economic Development Minister Brownlee estimated "The Hobbit" will create 1,000 jobs and stimulate $1 billion of spending, with scores of New Zealanders hoping for a chance to be one of the movie's many mythical dwarves, elves or trolls."More importantly it has been a 40-year exercise in New Zealand to establish a credible screen production industry here," Mr. Brownlee said.
New Zealand's alpine peaks, rain forests and wilderness provided the dramatic backdrop for Mr. Jackson's three "Lord of the Rings" films, which.have been followed by other big-budget movies—including "King Kong," "The Last Samurai" and "Prince Caspian." The country's film industry generated 2.8 billion New Zealand dollars (US$2.1 billion) last year. Like Mr. Jackson's earlier film trilogy, "The Hobbit" is based on the work of J.R.R. Tolkien; it follows hobbit Bilbo Baggins—whose adopted son, Frodo, is the hero of "Rings," set decades later—on an epic journey across the fictional land of Middle Earth.
The union, which represents performers who work in New Zealand, accused Mr. Jackson and Wingnut of refusing to recognize its right to negotiate a standard industry agreement.
