Killington Bond Passes, ASC and Powdr Corp

You heard it here first. The layoff and the April 13 closing for 2008 are totally consistent with how Powdr Corp operates Mt. Bachelor.

That new model, according to Nyberg, requires each Powdr resort to fend for itself. He said each resort is expected to fund capital improvements from its own profits with little or no money coming from the parent company in Utah.
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While this philosophy may work at Mt. Bachelor, I think there is a high risk of a debacle at Killington. Bachelor can be run on a lean model with its abundant snowfall (minimal snowmaking needed) and best-in-the-region preservation. The local drive-up clientele does not have an alternative with comparable snow quality.

Another point is that when Powdr Corp bought Mt. Bachelor, it had a Vail quality high speed lift and grooming system. They didn't need to invest much, and in fact they sucked money out by selling off most of the groomers. Everyone seems to think Killington has a lot of deferred maintenance from the ASC years and a new owner needs to invest money just to catch up to other Vermont areas. An intelligent buyer would have factored that in (along with the lifetime passes) when determining a fair purchase price.

While I may take potshots at eastern ski quality, there is no doubt about Riverc0il's point that it's a competitive market with many alternative areas to choose from. So I think it's going to be much easier for the easterners to vote with their feet and $ and go elsewhere if Killington's product is not up to snuff.

I don't think Highway Star's rant was even strong enough. Why just delay buying the pass until October? We've already seen enough from Powdr Corp that these people should ski somewhere else next year. Wait until Powdr Corp commits to meaningful improvements before committing your upfront $ to them.
 
For a lot of Killington skiers (those that live full-time in the area, and those that own property there), voting with one's feet will mean quite a drive. Easier said than done.

Quick rundown on central VT options other than Killington/Pico:

-Okemo: this is more South Central than Central VT. Perhaps more importantly, while Okemo is run very well, they don't compete on price either, and the terrain is a big step down from KMart. And they get substantially less natural snow than the hihger elevations at K.

-Ascutney: Great for hiking (I proposed to my wife on the hang-gliders paltform on West Peak), not so great for skiing. Not much in terms of natural snowfall, low elevation, and they don't/won't spend the $$ on snowmaking and grooming.

-Suicide Six: Nice family area on the outskirts of Woodstock, but it's not a major resort, if that's what you're looking for.

Bear Creek: I've driven by it and it looks kinda interesting, but it's much smaller than Okemo or K. I also haven't figured out if it's private or public...seems to be a mix of both.

Sugarbush: Comparable terrain to K, and generally more snowfall, but this is an extra hour + drive from Killington. Again, the extra distance is a big problem if you live or vacation along the Rt 4 corridor.

When I had a Pico season pass, it allowed me to ski Kmart early & late season, when the Pico lifts weren't running. I'll be very interested to see how Powdr prices a Pico season pass.
 
Tony Crocker":1hjr9ws5 said:
So I think it's going to be much easier for the easterners to vote with their feet and $ and go elsewhere if Killington's product is not up to snuff.
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The big question still remains...whose "snuff"?

We all know it won't measure up to FTO snuff, but it hasn't already for years. And in reality, with potentially less people and the same snowfall, the FTO type might be happier in the woods with fewer skiers, right? None of the snowmaking or grooming issues are in play in the trees.

Are folks with property at K really going to drive an extra hour to Sugarbush (the nearest best alternative IMO)? Some maybe.

What is totally unknown is the number of people who will still come based on past reputation or just plain curiosity. Although it seems impossible for any poster here to believe, people may like the new K.

So we just can't tell at this point if this is going to work for POWDR or not.
 
thanks to jimg for putting that up... that is quite a read for sure

tonyC wrote:

"While I may take potshots at eastern ski quality, there is no doubt about Riverc0il's point that it's a competitive market with many alternative areas to choose from. So I think it's going to be much easier for the easterners to vote with their feet and $ and go elsewhere if Killington's product is not up to snuff."


K's only relevance to me was early and late season, so i disagree with that statement....there is no competiton, for me, realistically, in november and may ( sometimes in april, but only sometimes ). and now, there might not only me no competion, there might me no options for lift service at all.

for a local, who is not going to travel to ski 80 to 90% of the time, there is no competition either.

for me, K will not see another penny in terms of season pass money until they commit to a longer season.
daily ticket wise, K will get my money only if there is literally no other substantive lift service running.. and even that will be unenthusiastic becasue of how they manage the terrain

and yes, i do remember the day i read tonyc's post predicting this almost to the T
 
joegm":31k9i1q2 said:
1) the season's being shrunk ( which is obviously my biggest concern )
2) the inaccurate perception now held by many people that sub 700 season passes are/should be the norm.
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100% agree with these statements about how the low pass prices led to problematic issues and bad perceptions. As Tony Crocker mentions in support of the Epic thread, the pass price is reasonable and fair (very reasonable, IMO) but the question is regarding the product. I am not going to judge this group before they even blow snow. I think it is a good value, especially the mid-week pass. The blackout pass is on par with many great mountains in New England and substantially less than many of Killington's northern neighbors. There are a lot of hard feelings right now but over what is what I keep asking? Length of season? Hardly, ASC already pulled back the season and kept pulling back further and opening later every year. Pass prices? Look where cheap season passes got ASC? Even BC with the Threedom pass went up substantially this year. Fact is cheap season passes do not sustain ski areas. Period. Nothing in life is free, cliche as it may be, and the blackout pass is extremely reasonable compared to what it might have been especially given the market and players Killington is competing against in the region. I personally hope the new owners rock Killington. Early/late season was completely dead long before this and cheap season passes obviously where not beneficial even though consumers loved them. I think everything about the business acumen of the new owners has been outstanding so far. I anticipate Killington being so much better of a resort... I might even drop the word Kmart from my lexicon and put Killington on the map for a mid-season visit (I have only been so far in November and earned turns after the lifts have closed).
 
riverc0il":2awbwpda said:
joegm":2awbwpda said:
1) the season's being shrunk ( which is obviously my biggest concern )
2) the inaccurate perception now held by many people that sub 700 season passes are/should be the norm.
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100% agree with these statements about how the low pass prices led to problematic issues and bad perceptions. As Tony Crocker mentions in support of the Epic thread, the pass price is reasonable and fair (very reasonable, IMO) but the question is regarding the product. I am not going to judge this group before they even blow snow. I think it is a good value, especially the mid-week pass. The blackout pass is on par with many great mountains in New England and substantially less than many of Killington's northern neighbors. There are a lot of hard feelings right now but over what is what I keep asking? Length of season? Hardly, ASC already pulled back the season and kept pulling back further and opening later every year. Pass prices? Look where cheap season passes got ASC? Even BC with the Threedom pass went up substantially this year. Fact is cheap season passes do not sustain ski areas. Period. Nothing in life is free, cliche as it may be, and the blackout pass is extremely reasonable compared to what it might have been especially given the market and players Killington is competing against in the region. I personally hope the new owners rock Killington. Early/late season was completely dead long before this and cheap season passes obviously where not beneficial even though consumers loved them. I think everything about the business acumen of the new owners has been outstanding so far. I anticipate Killington being so much better of a resort... I might even drop the word Kmart from my lexicon and put Killington on the map for a mid-season visit (I have only been so far in November and earned turns after the lifts have closed).
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While I'm not yet ready to anticipate that K will be better, I am in total agreement with you Steve. We have heard just about everything negative we are going to hear in terms of the new plan...most of the people who were going to get angry are angry. Now it's up to POWDR to make the plan work. I will go there sometime this year mid-season (which I hardly ever do) just to see for myself.

Like you, I believe they are on the right track for what they hope to accomplish.
 
Early/late season wasn't dead until they killed it, and season length and pass prices aren't what killed them (certainly not that simple anyway...).
 
What killed ASC was overleveraged expansion in a volatile business.

Was Killington on its own a loser for ASC? I doubt it if you exclude the debt service, which certainly wasn't incurred by investments at Killington.

Should Killington have been more profitable? Probably. The season passes were too cheap and as the product quality declined Killington probably lost some of the more profitable day ticket business. As an aside Mammoth has been trying to manage its season pass program since skier visits rebounded to the 1.5 million level in the big 2004-05 and 2005-06 seasons. First they closed the MVP program to new entrants. And the MVP is rising in price faster than the day ticket price. A new 1/2 price Gold is open to new entrants. Some of you will be amused that some people on the Mammoth Forum are whining about the prices, which for 2007-08 are $549 for the grandfathered MVP's and $750 for 1/2 price Gold. Both of these have no blackout dates (and are also good from May 1 onwards in the current season) but had to be purchased by April 30. They are also capped at something like 20,000 so in prior years they have sold out before April 30, though this spring they did not because of the low snow season.

I think Killington's very early openings and very late closings were useful for marketing. They reinforced the perception (accurate I think) that K's aggressive snowmaking would result in consistently the most open skiable terrain in the East. On March 15 this year Killington had 61% of trails open vs. 89% at Okemo and 100% at Sugarbush. On March 31 Killington had 52% of trails open vs. 77% at Okemo and 90% at Sugarbush. Would this have been true in the Preston Smith years? I don't see anything in Powdr Corp's track record to indicate that they would compete in this way because we know that snowmaking is expensive and that Powdr Corp is cheap.

So what's left as Killington's draw? Only "largest acreage in the East" I think. But it's not large and diverse in the sense of a Vail or Mammoth. It's just more eastern trail skiing. And if a lot of those trails have inadequate coverage or bulletproof surface conditions, why won't many easterners move to the more manicured surfaces at Okemo or more interesting terrain at Sugarbush?

I realize I'm preaching to the fanatic choir here (and on Epic). In the real world there is a lot of inertia in most skiers' habits. People who own property near Killington likely aren't going anywhere, and obviously Powdr Corp thinks most of the lifetime bond passholders are in this category and that they will gain revenue from them. And many of the people who could go somewhere else still won't as long as the season pass prices aren't more than the other areas. And some of the day ticket people aren't going to change their patterns either.

So can Powdr earn more revenue for the same or less expense than ASC did at Killington? With an appropriate amount of inertia from the 3 groups above probably. So in that sense I'll agree with Jim and Steve that Powdr's plan can work. As it has presumably at Mt. Bachelor.

But I think the Preston Smith model could work better. Highway Star proposed exactly what I've been saying for several years in the late season discussions. Make the Canyon/Glades area the focus of early and late season by connecting those lifts to the top of K1, which can be used as a transport lift. Put a nice facility up there where skiers will spend more on food and incidentals.

I think everything about the business acumen of the new owners has been outstanding so far.
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I'm not sure Steve would think this if he had a conversation with my high school friend in Bend. He's lived there for 25 years and done quite well in commercial real estate development, thus has better business acumen than most of us here. And I've never heard a good word from him about Powdr Corp.
 
Quick question.. Has Powdr Corp ever operated a ski resort that is heavily dependent on snowmaking? If not I think they could be in for a big shock... Will they make snow if the long rang shows a warming trend...? How fast will they recover after a thaw...? (This is the east there will be many).. Finally when will they shut the snowmaking system down?

IMHO what brought people to Killington was the long trails and the largest and best snowmaking in the east.. Families love to cruise on long never ending runs and knowing that Killington will allways have snow...
Take Okemo.. There success is based on snowmaking and gromming..
 
jasoncapecod":3iivfbzp said:
Quick question.. Has Powdr Corp ever operated a ski resort that is heavily dependent on snowmaking? If not I think they could be in for a big shock... Will they make snow if the long rang shows a warming trend...? How fast will they recover after a thaw...? (This is the east there will be many).. Finally when will they shut the snowmaking system down?

IMHO what brought people to Killington was the long trails and the largest and best snowmaking in the east.. Families love to cruise on long never ending runs and knowing that Killington will allways have snow...
Take Okemo.. There success is based on snowmaking and gromming..
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Ah, jason has hit upon the key to any success...snowmaking in the east. Yes, I agree with Tony and jason that making snow and maintaining good coverage and skiing surfaces (including grooming daily which is also expensive) is essential. This is key to the upscale amenities driven market POWDR wants. And there is alot of pressure for those folks from Okemo and Stratton as mentioned.

So POWDR is going to have to maintain a solid snowmaking facility to be successful. It's imperative that they do so. And it is the lynchpin of the whole plan.

We will have to wait for the cold to see what plays out.
 
For the people losing the "lifetime" passes, and cheap annual passes, there is no upside to looking at this rationally - they only want the new owners to invest many million, keep pass prices artificially low, and honour all the deals from the past failed management. Actually, the way some people want it is that these aren't lifetime passes, but eternal passes, valid for as long as the mountian is there. This is not a "symbiotic" relationship, it's parasitic.

OTOH Powdr didn't handle the issue very well. Before closing a condition should have been to have ASC put out the news that they were only selling the assets, not the company, and that the lifetime passes were only associated with ASC and would not be valid with the new buyer. Further ASC could have pointed out that prior to Powdr's involvement ASC was in very bad financial shape and if the company failed or went bankrupt the passes would not likely survive either; and an asset sale was the only way to attract buyers to the property. People would still scream, but most of this heat should be directed at ASC for screwing things up so badly as their mismangement caused the problem. Instead Powdr stumbled along and are getting all the heat for "cancelling" the passes.

For "lifetime" pass holders the real problem is ASC. If ASC has an obligation or liability from them they will have to sue ASC for compensation. This is an asset sale, and lifetime passes attached to a corporation issued in 1960/61 having a run until 2006 is pretty outstanding. I feel sorry for people who paid big bucks on the aftermarket but didn't understand what could happen due to mismanagement. When a company almost goes under small creditors usually get squished, and that's the story here. Don't blame the guys that were willing to buy it. If ASC gave a damn about the "lifetime" passes they would have been part of the negotiation, and they would had to take a lower price for Powdr to take them on. If it's true that the "lifetime" pass information came out at the last minute then ASC was being very cute and negotiating a price without them in the package. I have a bit of a hard time believing Powdr was completely unaware of the issue though.

When originally issued a true "lifetime" pass should have been part of the deed and insulated from the vagaries of corporate structures and asset sales. Not sure what the law is in Vermont but I know here that property restrictions and benefits can be attached to deeds. Maybe it was a kinder gentler, more trusting era then, but I doubt the intent was for the passes to be flipped for big bucks down the line, nor did they anticipate the competition that is out there now.

Time to suck it up and give Powdr a few years to see what they do with the mountain. Anyone dropping in half way through year 1 is likely to be dissapointed and shouldn't pass judgement that quickly. It took years of decline to get there and turning it around won't happen right away. There will also probably be several changes aimed at "maximing" revenue, Tremblant sytle, that won't be popular. It's a new era, for better and worse.
 
Quick question.. Has Powdr Corp ever operated a ski resort that is heavily dependent on snowmaking?
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Bingo. This is why I think there's a chance of a debacle. In the 1980's SKI Ltd. (Killington before ASC) bought SoCal's Bear Mt. and immediately installed a snowmaking pipe to Big Bear Lake to match next door Snow Summit's water capacity. Nonetheless the quality of snowmaking at Bear Mt. never measured up to Summit for over a decade of management by Ski Ltd., Fibreboard or Booth Creek. Snow Summit bought Bear in 2002 and to no surprise the snowmaking quality almost immediately became comparable between the two areas.

Evidently snowmaking is somewhat of an art as well as a science, and I recall reading that "what works best in Vermont may not necessarily work best in the semidesert climate of Big Bear."

OTOH the lower half of Park City (the one resort where Powdr Corp is definitely not cheap) is very snowmaking dependent in early season. So they do know something about it. But I'm sure there are differences (as implied by the Bear Mt. tale) and while snowmaking is important at Park City it's the lifeblood of Killington. If experienced snowmakers were among the recent layoffs, I would view that as a big red flag.
 
I think the real test will be after we have a flooding rain in mid to late january. Will they be willing to invest the money to repair their mountain with only 6 weeks left in the season. As far as their experience with PCMR goes, Usually when you make snow out west the chance of it washing away are slim to none. But who knows they might be blessed with a cold and snowy winter..
 
If they don't know the importance of experienced snowmakers, and the importance of having a decent product for school spring break in the East, I hope they have a good trustee lined up.
 
i wish i could share jimg and river's positivity going into this coming season with K... but i just can't
i think crocker's prediction of a debacle has a high chance of playing out as accurate, as so many of crocker's observations have . certainly if the snow year starts out like this past year did they are in some trouble for sure..and even if the snow year progresses along as average, the question stands , " why go there ".. what the hell is the attraction.
i think a lot of the appeal of K has been
1) early and late season turns
2) the nightlife
since #2 is and should be irrelevant to serious skiers and #1 seems to be 86'd.... the mighty K is looking a little weak...i'm certainly not gonna gamble 75 for a daily ticket when i could go to stowe for the same money and get interesting lines or go to mad river if the snow is good for half the cost and lines that are 10x's as good and anything K has
` for a non local why not go to stowe or bush if the snow is just average...the terrain is better for sure at both of these and the cost is pretty much the same... and if the snow is above average, throw mad river into the mix of those 2.
i just can't see why i would go to K for any reason if even some of the rumors play out.
K ,it seems ,is going to be a large groomed out blvd of a hill with a ton of lifts that don't spin 5 out of the 7 days a week and no real interesting terrain, no good bump runs and no real trees to speak of .
why would anyone except locals make a road trip to K.?
the only real use i ever had for K was early and late season.. even when i was buying the pass, which i did for 5 years in a row, if i was there more than 3 times in jan feb and march it was a miracle.
about the only reason i can think i might go to K now would be for the us nationals to see the best amature skiers in the country... but even that is getting painful....as jonny mosely said to me and my buddy this year as we got off the lift at O.L this year " dudes are there any bump runs here for the public to ski "? :roll: .....pretty unbelievable isn't it that during the us national mogul championships the answer to mo's question was " no"...
:evil: :evil: :evil:
all that trashing having been said.. if K was spinning till memorial day, i would buy the midweek pass tomorrow at anything up to 750.. and that's just to ski it in nov, dec april and may
 
I'd like to give of my 2 cents, I haven't been able to keep track, but there is so much to read and I need to get ready to drive to Montreal and beyond.

All this to say and I stated it before in the old FTO, K for me (as for joe also it would seem) was my early/late season destination. I didn't have any choice if I wanted to have real early/late season turns. K was the only game in town for a number of week. I have bearly skied K in the months between November and May (see quote below). K has lost that over the year, case and point...Wildcat and K on the last weekend of the season. Cheaper and more terrain open at Wildcat versus Kmart. This has happened more than a few times in the past few years.

I mostly agree with Joe and Tony points about the potential continual downslide of Killington. Joe is right regarding the great terrain at Bush, MRG and Stowe. Kmart also has some great terrain, UNFORTUNATELY this terrain was blasted, widen, heavily groomed and blasted over the years. The Canyon area and Bear Mountain (OL and DF) were once marquis area in the East, but now?

About the snowmaking and percentage of open terrain that Tony's speak of, it definitely take much more effort to cover an area the size of K than Stowe. Percentage of open terrain can also be related to the area closing lifts in order to save money. Tremblant has done this.


(This could be part of another discussion) That's why those numbers don't always correlate with snow coverage (as mentioned in past discussion). The best example that I have for Tony is what I saw at Mammoth in mid-June 2005, although the numbers of lift and trails actually open was very limited for an area the size of Mammoth, it didn't reflect on what could have been open with the snow that was on the ground.

Here is a 2004 Kmart discussion.

http://216.250.243.13/discus2/messages/2508/3935.html

Patrick":3ihmfsqk said:
(edit: 2007* - I updated the numbers) As you can see below, my ski days at the Great K have been concentrated on early/late season.

To add facts to my statements my skier-days to K and the fact that it was on the margins of the season. Kevin has already posted his, here are mine:

October: 0
November: 7
1) 9 nov 91
2) 10 nov 84
3) 11 nov 90
4) 16 nov 84
5) 16 nov 86
ed) 20 nov 04*
6) 27 nov 88

December: 4
1) 13 dec 97
2) 15 dec 96
3) 22 dec 95
4) 24 dec 85

January:0
February: 0
March: 2
1) 11 mar 94
2) 12 mar 95

April: 2
1) 3 apr 91
2) 8 apr 85

May: 23!!!
1) 6 may 88
2) 10 may 86
3) 13 may 88
ed) 14 may 05*
4) 17 may 87
5) 18 may 86
6) 18 may 87
7) 18 may 97
8 ) 19 may 91
9) 20 may 89
10) 21 may 84
11) 21 may 00
12) 22 may 84
13) 22 may 92
14) 22 may 94
15) 22 may 95
16) 23 may 84
17) 23 may 93
18 ) 24 may 84
19) 24 may 99
20) 27 may 95
21) 28 may 85
22) 29 may 85

June: 8
1) 1 jun 92
2) 1 jun 93
3) 1 jun 94
4) 1 jun 95
5) 1 jun 96
6) 1 jun 97
7) 11 jun 92
8 ) 15 jun 97

There you have it, I would have only skied 11* days at K if this season opening/closing would have been the norm over the past two decades. I skied 32*days on those margins that have been cut-off, 28 in the late season. I skiied Killington more time on JUNE 1ST that the entire months of January, February, March and April (6 times vs 4)!!!

I don't believe that I am the only skier that were only skiing K when everything else was closed. I was willing to drive 200 miles to get those turns in late May (400 since 1994-95) that K, I am sure some other were too.
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I'm one of the property owners at Killington caught in all of this mess.

What attracted me to Killington in the early 80's was:
- The proximity to metro-Boston... an hour closer than Stowe or Bush/MRG
- The October to June season
- The snowmaking reputation where buying a pass was a good risk
- The sheer size of the place and diversity of terrain
- The ski house scene and nightlife on the Access Road

At the time, the skiing surface was much better since they had far less uphill capacity. They hadn't made any of those ultra-wide trails other than Outer Limits. It had big liftlines if you didn't know how to avoid them but that wasn't an issue if you knew the place.

I have no idea who these new owners think they're marketing to. Killington will never be a family mountain. It's always going to be weekend-centric like any other resort in the east. It will always be the Beast of the East because of the kind of customer they attract and the overall terrain available. The share houses and the season pass business targeted at 20-somethings and 30-somethings always drove the mountain and those were passes that broke even with 20 ski days ($1400 in today's dollars). Bourbon Street North was the proper way to market the place. When your share house goes from November 1 to May 1 and the resort announces a mid-November to mid-April season, a lot of share house people will think long and hard about coming back. The ASC Killingotn had a lousy midwinter product and there is a lot of doubt that the new owners have the means to improve it... particularly when they have chased away enough of their business that they can't afford to make enough snow to cover the mountain propertly. If they shrink to 600K skier visits, I'd expect less open, not more.

I'm going to give it a season. If I don't like what I see, my place will go on the market in March or April.
 
I think Geoff represents the mainstream of Killington's business. Patrick does not because his distance logistics are the opposite of most visiting Vermont skiers. joegm's criteria are shall we say, specialized, though I'm personally all for his desire to have someplace for early and late season. The management philosophy of minimizing open lifts and trails on non-peak days is standard operating procedure for Powdr Corp at Mt. Bachelor. If they do this at Killington, it will no longer be the Beast of the East and I'd expect that shrinkage to 600K skier visits.

If I had been Powdr Corp, I would have tried to jam ASC in final negotiations about the lifetime passes, done exactly what Powdr did with the regular season passes, and made a highly publicized commitment to restore the aggressive snowmaking schedule and by implication, the "Beast of the East" reputation.
 
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