Development and Strategies at Feeder Ski Resorts

[jamesdeluxe]

a much higher percentage of rental ski equipment than we have noticed at the other mountains

I'm always amazed by the amount of business that rental ski shops do in the Alps compared to the U.S. We've discussed that there's always been a significantly higher casual-skier demographic in Europe and that the Vail Resorts/Alterra duopoly has exacerbated the situation -- putting last-minute day passes out of reach to most people and severely limits the number of new skiers who'd like to try the sport, basically shooting themselves in the foot for future growth. I'm sure that they gamed out this scenario and went ahead with it regardless. I'd love to know their thinking.

Sbooker tends to ski exclusively at major resorts so I was glad to see that he had such a positive experience at a smaller ski area on this trip, Grand Targhee.

 

[Sbooker]

Sbooker tends to ski exclusively at major resorts

Mainly due to the fact we don’t visit the US or Canada for long so generally buy a Mountain Collective Pass which limits options but not quality.
We have visited smaller resorts in Europe where it is possible to purchase a reasonably priced daily lift ticket. I hope to visit an independent hill or two when I’m in BC next week.

 

[Tony Crocker]

smaller ski area on this trip, Grand Targhee.

2,602 acres might be small in the Alps, but few would say that for a North American ski area.

 

[Tony Crocker]

I'm sure that they gamed out this scenario and went ahead with it regardless. I'd love to know their thinking.

Revenue stability as a hedge against low snow years has compelling logic.

The duopoly aspect means that both members of it have a wide enough variety of areas that most their passholders are satisfied directing most of the ski days to areas "within the family." And some of them ski more days due to the marginal cost of an extra lift ticket being zero, but still contributing other revenue to the duopoly.

shooting themselves in the foot for future growth.

Short termism infects both publicly traded companies (Vail) and private equity (Alterra).

Logically, Vail should be subsidizing beginners like crazy at all of these feeder hills they bought in the Midwest and Northeast.

 

[jasoncapecod]

Revenue stability as a hedge against low snow years has compelling logic.

The duopoly aspect means that both members of it have a wide enough variety of areas that most their passholders are satisfied directing most of the ski days to areas "within the family." And some of them ski more days due to the marginal cost of an extra lift ticket being zero, but still contributing other revenue to the duopoly.

Short termism infects both publicly traded companies (Vail) and private equity (Alterra).

Logically, Vail should be subsidizing beginners like crazy at all of these feeder hills they bought in the Midwest and Northeast.

I was just discussing this with my friends. They only care about the stock and real estate prices..
If they cared about the sport beginners would ski for free / nominal cost...

 

[Tony Crocker]

If they cared about the sport beginners would ski for free / nominal cost...

Not saying they care about the sport long term. But:

these feeder hills they bought in the Midwest and Northeast

can't be attracting serious skiers aside from race programs and park rats. Surely beginners are a large proportion of the clientele. Aren't the ones who get hooked in the pipeline for Vail's western destinations?

 

[berkshireskier]

Not saying they care about the sport long term. But:

can't be attracting serious skiers aside from race programs and park rats. Surely beginners are a large proportion of the clientele. Aren't the ones who get hooked in the pipeline for Vail's western destinations?

Yea, Tony, I have been (half-jokingly) saying this about my local ski hill in western Mass for several years now. It's been owned since opening in 1964 by the same family but (I don't think) they have the capital to really make any substantial improvements to the ski area (although I just got an email today saying that they are replacing a decrepit triple chair with a new Skytrac quad (not high speed, I don't think) which they claim is costing millions of dollars), so I've been saying that they should sell out to a place like Vail Resorts that has access to more capital to invest to improve the ski area. It would the perfect feeder mountain for a place like Vail because the clientele is largely affluent New Yorkers (from NYC or surrounding suburbs) who have second homes in the Berkshires (about a 2.5 hour drive from NYC) and will ski at this local hill on Winter weekends, many with kids and the ski area has a very active youth race program. When the conditions are good and the weather is OK, it is actually very crowded on weekends. They have been selling inexpensive season passes for years, so it's relatively cheap to ski there. I taught skiing there for about ten years and taught MANY beginner lessons (they would literally bring in busloads of people from Boston or New York for the beginner lessons). It was a good place to introduce people to skiing, within a relatively short drive from major cities - NYC, Boston, Hartford, Albany, etc.

 

[EMSC]

replacing a decrepit triple chair with a new Skytrac quad (not high speed, I don't think) which they claim is costing millions of dollars),

Skytrac is the US based partner of Leitner-Poma who exclusively builds fixed grip lifts. And yes, even fixed grip lifts cost multiple millions, if new, in todays world (prices skyrocketed over the past 5-7 years).

I've been saying that they should sell out to a place like Vail Resorts that has access to more capital to invest to improve the ski area.

You'd likely see less capital infusion than you'd think. Vail has been doing a one time infusion in initial year of purchase and then nothing but maintenance after that for the feeder hills they own. And even then the initial infusion sometimes isn't nearly what you would expect.

 

[berkshireskier]

Skytrac is the US based partner of Leitner-Poma who exclusively builds fixed grip lifts. And yes, even fixed grip lifts cost multiple millions, if new, in todays world (prices skyrocketed over the past 5-7 years).


You'd likely see less capital infusion than you'd think. Vail has been doing a one time infusion in initial year of purchase and then nothing but maintenance after that for the feeder hills they own. And even then the initial infusion sometimes isn't nearly what you would expect.

Yea, EMSC, the email I received from Ski Butternut just said the new lift is costing "millions". It is about 3,600 feet long (linear) and will rise about 750 vertical feet. It's a much needed improvement as it feeds into some of the best terrain on the mountain (IMHO) and the old lift (although tecnically a "triple" chair, I used to call it the 2.5 chair because it was hard to get 3 full size adults on the chair) was old and always breaking down. I'm amazed that they area is spending that sort of money on a new lift but I assume they will raise season pass prices and daily lift ticket prices.

I've hear that about Vail Resorts. My daughter and I were skiing at Hunter last year and everyone that we rode up on the lifts with who were long-time Hunter skiers were bitching about the lack of investment in the mountain by VR. They were especially angry that Vail had substantially curtailed what had been a very robust snowmaking operation. Hunter did have the reputation for having the most extensive and best snow making coverage in the country and, to save some money, Vail greatly reduced how much and how often they ran the snowmaking system.

But a lot of these small "mom and pop" ski areas just don't have the capital to make substantial improvements in their infrastructure and big players like VR should have more capital or access to capital.

 

[MarzNC]

If they cared about the sport beginners would ski for free / nominal cost...

For what it's worth, the PA resorts owned by VR are starting to get their ski school programs put back together. Seven Springs (near Pittsburgh) has multi-week programs geared towards beginners of all ages. Can get a lesson on three Wednesdays at 5pm for $209, which includes lift ticket and rental gear. Even less for people with an Epic pass and/or gear.

https://www.7springs.com/plan-your-trip/ski-and-ride-lessons/category/seasonal-programs.aspx

Slope Days - After School Ski School | Seven Springs Ski Resort

www.7springs.com

 

[Tony Crocker]

to save some money, Vail greatly reduced how much and how often they ran the snowmaking system.

Mid-March 2023 was the only time in my bimonthly records that Hunter has been more than 73% open in the past 3 seasons. The 20-year average is higher than that from Jan. 15 - Mar. 15. Three years is a too small sample size but some skiers presumably know their local weather and can tell when Hunter might have made snow in the past but does not now. But sometimes the weather is just ugly, as in SoCal now with the fewest ski runs open at New Year's in over 40 years.

 

[MarzNC]

Vail has been doing a one time infusion in initial year of purchase and then nothing but maintenance after that for the feeder hills they own. And even then the initial infusion sometimes isn't nearly what you would expect.

What happened for the first separate acquisitions in the midwest in 2012 was very different than when VR ended up with a bunch of small hills after taking over Peak Resorts. As I remember, VR earmarked plenty of money for capital investments for lifts and renovating base lodges. The transition from a management and staff standpoint was a bit rockier. Things were smoothed out during the first season though.

The most recent acquisition in western PA was in late 2021. Very little changed for the better in the first two full seasons under VR ownership.

 

[MarzNC]

Mid-March 2023 was the only time in my bimonthly records that Hunter has been more than 73% open in the past 3 seasons. The 20-year average is higher than that from Jan. 15 - Mar. 15. Three years is a too small sample size but some skiers presumably know their local weather and can tell when Hunter might have made snow in the past but does not now. But sometimes the weather is just ugly, as in SoCal now with the fewest ski runs open at New Year's in over 40 years.

The comparison the guys make on NYSkiBlog for whether or not Hunter snowmaking makes sense is to the other resorts in the Catskills. Hunter, Belleayre, Windham have pretty much the same weather but very different ownership and management approaches.

 

[jasoncapecod]

The comparison the guys make on NYSkiBlog for whether or not Hunter snowmaking makes sense is to the other resorts in the Catskills. Hunter, Belleayre, Windham have pretty much the same weather but very different ownership and management approaches.

This couldn’t be more true. Belleayre is reporting 100% opened on their snowmaking terrain, which is more than 80% of the mountain.

 

[Tony Crocker]

Bel-Air is reporting 100% opened on their snowmaking terrain, which is more than 80% of the mountain.

Hunter is about 2x the size of Belleayre, but given the reputed capacity of Hunter's snowmaking, point well taken. Snowmaking IS Hunter's brand, hard to believe no one in VR management understands that.