Here & There | April 24, 2020

The state of skiing

Here & There is a weekly-ish email from Kyle Frost about travel, the outdoors, and other stuff. If you enjoy this issue, please consider forwarding it to a friend. If you’re reading it for the first time, consider subscribing (it’s free!).

The state of skiing

In early March, before most of us were on lockdown and things were still sort of normal, I wrote this:

The major ski resorts — many of which I think are likely to close in the coming days — will be ok (not great, but ok)…they’ll lose a lot of money, but we’re in the latter part of the season already…it’ll be interesting to see how this effects next season’s pass sales.

3 days later, Vail closed for the season, and Alterra followed suit. And then the world shut down. Here’s an update on what’s happened since then.

  • Vail Resorts furloughed 2,000 year-round hourly employees, and cut pay up to 25% for salaried staff. CEO Rob Katz is forfeiting his salary, and estimates a loss of up to $200 million this quarter.

  • Alterra Mountain company also announced furloughs, and CEO Rusty Gregory is going without a salary. Estimated losses have not been announced, although they’ve said that 50% of previously planned capital expenditures will be postponed.

  • Alterra doubled their pass renewal discounts for the 20/21 season, and announced “Adventure Assurance” — allowing pass holders to differ their passes to the 21/22 season at no cost.

  • Two separate class-action lawsuits have been filed against Vail and Alterra, alleging that “the ski resort companies that closed in March due to Covid-19 defrauded customers by not offering partial refunds of season passes.”

I want to dig in to that last bullet point a bit. Basically, these folks are arguing that Vail and Alterra failed to fulfill their end of the ‘season pass’ contract and refunds are deserved. I think there are a couple things wrong with this.

One, it’ll probably get thrown out of court due to force majeure, a term that’s likely been used more in the last month than the last ten years. It’s a legal term defining “acts of god” like natural disasters, etc most often used in the context of events but may apply here as well. You assume a certain amount of risk when you buy a season pass, and while resorts typically guarantee a certain number of open days (which they met), there’s no guarantee on when they’ll close. Add that to the fact that it would have been illegal for them to stay open, and I don’t think there’s a strong basis for a lawsuit here.

I also feel like this reaction (and the associated sideline commentary) is more symptomatic of the "Vail/Alterra are evil" mentality. They've treated their employees pretty well during this, despite articles to the contrary, and they've both said that they're trying to figure out how this affects pass holders and next year. But instead of waiting to see what they do, these folks decided suing was the best option.

They’re in a super tough spot here. If covid affects next winter *at all*, you're looking at a huge affect on the entire industry + mountain towns.

These resorts are wondering whether or not they'll be able to sell passes in *any* significant quantity, or whether they'll be able to even open resorts next season. Even if we get things mostly under control, leisure travel will likely be one of the last things to return to normal — and ski resorts make most of their money from people that fly in for a week, not locals driving up on the weekends. Vail alone has lost $200M already, and anticipating revenue for the 20/21 season will be nearly impossible -- resulting in resorts potentially operating with skeleton staff or partial terrain. I might dive more into the 2nd order affects in a future email, but needless to say, these mountain towns will be hurting as well.

I think an interesting possibility is that many of the resorts end up operating more like “local” resorts rather than “destination” resorts. It’ll allow them to have a smaller staff, and focus their marketing more on local markets rather than big-ticket travelers.

There are a lot of unknowns here, and it just feels narrow-minded for these folks that are suing to be so concerned with "you closed early because of a worldwide pandemic and I want my money".

Other news

  • Big retailers like REI and Backcountry continue to hold sales as they struggle to move product.

  • After closing it’s distribution centers in response to COVID, Patagonia has decided to begin shipping again.

  • In Australia (and likely the US as well), they’re seeing a huge boom in bike sales, as consumers look for ways to stay active while social distancing. I’m personally thinking about getting in on the gravel bike craze.

Fun Stuff

I built a chrome extension for The Outbound this week — it loads a random adventure around the world in your new tabs. If you want to give it a try, just visit this link.

Whalebone Magazine and B&H Photo launched a photo contest with $25,000 in prizes.

I loved this Earth Day video from Pattie Gonia and my friends at Wondercamp.

Yeti Coolers launched a new “streaming service” 😂

Stay safe, stay healthy. As always, feel free to reach out with ideas, feedback, or stuff you think I should talk about via email, Instagram, or Twitter.

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