Wētā FX job cuts spark subsidy debate
Friday, 1 August 2025
A global screen sector downturn, trade tariff uncertainty and Australia’s ultra-competitive film subsidies are being blamed for the potential loss of up to 100 jobs at Wētā FX ‒ mostly in Wellington.
The digital effects and animation company ‒ majority owned by Sir Peter Jackson and Dame Fran Walsh ‒ has worked some of Hollywood’s most high-profile films, including The Lord of the Rings trilogy, King Kong, and more recently, the Avatar series, Kingdom of the Planet of the Apes, Better Man and Alien: Romulus.
In a statement on Friday, Wētā FX confirmed about 100 jobs could be affected by proposed changes. It employs about 2200 staff globally and only recently announced plans to expand its Melbourne operation.
That has raised questions about Australian film subsidies gazumping New Zealand. The New Zealand Government offers a rebate of up to 20% on eligible large productions. Australia offers 30% plus up to 15% from state and territory governments.
The rebates are seen as a way to get big budget international films made locally. Those who argue for them say the financial payoffs for the host countries massively outweigh government rebates. Those who oppose point out most other industries do not get the special treatment.
Finance Minister Nicola Willis, speaking on Friday, did not believe New Zealand was being outgunned by its neighbour. It was symptomatic of a slowdown globally in the industry, she said.
The Government demonstrated its commitment to screen sector in the Budget, she said, through a $577 million investment in the rebate scheme.
“This was welcomed by the industry as a positive message of support,” Willis said.
“Globally, the screen sector has faced challenges in recent times, with the reduction in overall production volume. Nonetheless, we remain confident New Zealand is well-positioned to attract major productions, which look to us not only for our rebate scheme but also for our offering of exceptional talent, capability and locations.”
New Zealand screen producers’ guild president Irene Gardiner did not want to comment on Wētā FX’s situation during the consultation period, but acknowledged the global screen environment was “tough:.
“There have been a range of factors over the past few years that continue to impact it, including the pandemic, industry strikes, the LA fires, and the talk around US tariffs.”
She said the rebate schemes were an area where the industry was always open to possible enhancements so more international screen work was attracted to New Zealand and more local productions could get made. “It's something the industry talks to Government about on an ongoing basis, and that will continue.”
Wētā FX is one of Wellington’s largest digital creative employers and one of the local sector’s most well-connected feeder companies for talent. Many who start work with Wētā FX in New Zealand go on to establish their own companies and local ventures.
Wellington mayor Tory Whanau said the city was ready to work with the Government and WellingtonNZ to ensure “New Zealand can compete with other countries like Australia” to attract more international productions.
“If proposed changes leading to job losses are confirmed, this will be a major blow to Wellington’s creative sector and the city’s economy, especially with the ongoing public service cuts,” she said.
Wētā FX’s statement on Friday said, as with all visual effects houses, “artist numbers fluctuate based on the needs of current projects, so it is not uncommon for crew numbers to shift over time”.
“A consultation period has since started with the crew that are proposed to be impacted. Following a period of feedback and review, the changes will be confirmed and impacted crew will be informed. If the proposed changes are confirmed, they will be phased in with specific dates or role transitions dependent on individual agreements and circumstances.”
A number of factors led to the proposed changes, it said, including current challenges facing the global entertainment industry.
“In addition to unexpected delays in projects being greenlit due to financial considerations, the industry continues to feel the long-tail impact of the pandemic, industry strikes, and changes in audience content consumption habits.
“As a leader in visual effects, which happens at the end of a film’s creation in the post-production process, Wētā FX is navigating the after-effects of these disruptions to ensure ongoing sustainability.”
In April, when Wētā FX in April confirmed it was creating 80 new roles in Australia, head of VFX Matt Aitken said Wellington remained its headquarters, with 70% of its workforce based in New Zealand.
“This strategic expansion is designed to bolster our teams by strengthening our local talent pool and ensuring full support for our creative efforts. Our Melbourne hub, launched in 2022, has swiftly become a creative powerhouse,” he said.
Last year the company hit headlines when it was revealed to have posted a loss for the second year in a row, $83 million in the year to March 2024 following a $107m loss posted the year before. The company was not expected to return to profitability for at least two years, according to account notes.
That was after it made job offers to 265 engineers who were laid off in a restructure of Unity Software in 2023. Jackson had sold off the technology division of Weta Digital, which included the engineers, for $2.3 billion to the American video game software development company in 2021. Of those workers, 97% were now back with Wētā FX.