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Is Vail group financially secure?

Discussion in 'Snow Talk' started by coolair, Jul 11, 2020.

  1. zac150

    zac150 A Local Ski Pass: Gold

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    honestly I read it that Vail have strong links to a series of Hotel chains that they work with to offer accommodation services at their sites. But they hadn’t worked out a way of making it viable given the whole lease system.
     
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  2. rugbyskier

    rugbyskier One of Us Ski Pass: Gold

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    I can confirm that Pete Sonntag was an instructor at Thredbo in 1992 because I had a lesson with him in September that year. How do I remember this? Well, it was very memorable.

    1992 was a record snow year and the cover reached its peak in September. It was my third year skiing and I moved to Canberra earlier that year, taking advantage of the proximity to the snow. I drove to Thredbo on the Friday night and there was nearly 40cm of snow overnight.

    I had booked a group lesson for Saturday morning and only two of us turned up. Pete Sonntag was the instructor and I remembered the name because I speak German. Given the conditions and the small group he decided he was going to teach us how to ski deep fresh snow and we had an awesome lesson skiing thigh deep fresh tracks on Little Beauty and the Bluff. For Thredbo regulars, the snow was so deep that weekend the fence above the Meadows mid station on the Kosciuszko Express was completely buried.
     
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  3. snowgum

    snowgum One of Us Ski Pass: Gold

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    So why post matey?
    I subscribe to the Age BTW & few guitar & music sites. ;)
     
  4. Legs Akimbo

    Legs Akimbo Grumblebum Ski Pass: Gold

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    Goal posts on roller skates.
     
  5. sly_karma

    sly_karma Old n' Crusty Ski Pass: Gold

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    Vail has volume, other resorts may not bother with reservations. I know at Apex they are selling season passes and not having a booking system. VR knows its properties I guess, hope this one size fits all approach works for them. Do their mid atlantic and midwest ski hills get the visitation density to necessitate booking tickets?
     
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  6. Telemark Phat

    Telemark Phat Pass the butter Ski Pass: Gold

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    The pricing is from IPART, not whichever department parks lives in these days.
     
  7. snowgum

    snowgum One of Us Ski Pass: Gold

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    I just has a look at their web site. That’s interesting. I Think the Vic Gov (DELWP) review most major costs within resorts on behalf of the Minister, but an increase has to be pretty big before being knocked back by DELWP.
     
  8. MarzNC

    MarzNC One of Us Ski Pass: Gold

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    Definitely!

    My home resort is in the mid-Atlantic (not VR). No crowds midweek but weekend lift lines are 10-20 min between 10:30 and 3:00 in the mid-Atlantic, if not longer. That's typical at most of the mountains within a 3 hour drive of the cities in PA, DC, VA. During good weather people will wait in line for 30 min without really complaining that much. I don't mean good snow conditions, I really mean a sunny day that's not too cold. Most of the folks are beginners or intermediates, so they rarely ski a full day.

    My friend who is an advanced skier used to live in the DC area near the small mountains that VR bought in PA used to arrive for the extra morning hour for season passholders, and leave by 11:30. Whitetail only has 4 chairlifts and the terrain is separated by ability level, so she could stay on the black terrain a little longer without too long a wait. But still not worth staying much past noon. The other two VR locations in the MidA are in central PA, and also within a couple hours of DC/Baltimore.

    The small mountains that VR owns in the mid-Atlantic and midwest are all close to large metropolitan areas. Most were family owned ski areas with a few that have slopeside lodging and other activities. For instance, Washington DC, Chicago, Detroit, Minn/St. Paul, or Cleveland. Those are feeder hills close enough for day trips, but also popular for weekend overnight stays. The reason there is night skiing at many midwest ski areas is because there is so much demand. In some cases on weekends the lift stay open until midnight or 1am. The idea behind the acquisitions was to expand the reach of Epic into those markets. Buy Epic Local as a season pass for the local hill and plan a ski vacation or two at one of the VR destination resorts.

    First purchase was in 2012, last purchase that brought in the Mid-A and Ohio/Indiana locations was just before the 2019-20 season. The number of Epic passes sold increased by a significant number after each of the acquisitions. I started paying more attention to N. American ski industry news around that time. Long time season passholders at the first three midwest ski areas were pretty nervous. But VR spent a lot of money on new lifts, snowmaking infrastructure, and other capital projects that the family owners couldn't afford. Once those improvements were made and people started to understand the value of an Epic pass, the locals were pretty supportive. VR kept 1-location passes, as well as senior passes.

    For context, a long run in the Mid-Atlantic or midwest takes an intermediate 5 min at most, 2 min for an advanced skier. Lots of snowmaking, probably all the VR mountains have 100% coverage.
     
    #258 MarzNC, Sep 2, 2020
    Last edited: Sep 3, 2020
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  9. Dave Clark

    Dave Clark One of Us Ski Pass: Silver

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    FAR from it. People underestimate Baw Baw & Lake Mountain market share, and even Buller some times. 2019 market share was
    • Buller 43% (more than Falls & Hotham combined)
    • Falls 18%
    • Hotham 16%
    • Lake Mtn 13% (nearly as many visitors as Hotham!)
    • Baw Baw 9%
    • Stirling 1%
     
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  10. Aractus

    Aractus One of Us

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    Thanks for sharing this! Just a note the podcast is here and free for anyone.
     
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  11. climberman

    climberman CloudRide1000 Legend Ski Pass: Gold

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    It'd be an interesting request to Dominello about freeing up more accessible business opportunities, etc for shuttle services and buses with a shift in the pricing approach. Dominello seems to love these types of issues.
     
  12. MarzNC

    MarzNC One of Us Ski Pass: Gold

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    Good to know they are public! For that account I tend to stay logged in so wasn't sure. The other podcasts in the past few months have been pretty interesting as well.

    I got a SAM subscription in 2019 in order to get Chris Diamond's book Ski Inc 2020 a little quicker. I think he may need to write another one, maybe "Ski Inc 2022." For the 2020 version, he had to scramble and do some re-writing after VR announced the purchase of Peak Resorts just a few months before publication. That's why VR now owns small hills in Pennsylvania, Ohio, and Indiana. Also got Mt. Snow resort in southern Vermont, which draws from New York City and Boston.
     
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  13. Telemark Phat

    Telemark Phat Pass the butter Ski Pass: Gold

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    It would be great to see it change, I think the current winter surcharge approach is a poor solution for managing the park.
     
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  14. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    Awesome- that’s good news - it’s always interesting to compare the relative share of single day vs. overnight stays in Victoria - visitor days vs. visitor numbers.

    All power to Buller which has kept many friends and made many this season, unlike some other players!
     
    #264 Chaeron, Sep 2, 2020
    Last edited: Sep 2, 2020
  15. snowgum

    snowgum One of Us Ski Pass: Gold

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    Thanks for the figures Dave. Baw Baw has grown!

    re Mt Stirling: Just thinking of where MBS ARM want to send snowplayers and tobogganers at peak times?
    My understanding is that Stirling is 'part' of the back up plan when Buller is super-crowded as well as being home to us old Pin-heads, school groups and many locals seeking a quieter experience than Buller etc...

    But I wonder how many Buller snowplayers (especially first-timers or occasional visitors) snub Stirling because of the dirt road and 'perceived poorer access and facilities'. Naturally this stuff doesn't put off us old timers and regulars. Well not until we drag young kids along, then it does.

    So forgetting covid and record bad snow, are there any thoughts form the MBS ARM with regard to sealing the Stirling Rd gradually (as discussed speculated for > 35 years) - perhaps with VicRoads (now RRV), Shire and even Fed Govt grants?

    This (along with improved Stirling marketing) would be the no#1 thing to improve Stirling nos., especially in the overcrowded day snow-player, tobogganer segment. Improved access could even snare a small share of the Lake Mtn market - another bubble that needs alleviating when the snow cover is good. The other thing moving the base up would be a close #2 but I think that's been binned indefinitely as uneconomic.

    Just a thought. Not all plans (ideas) should be archived just because of one (~ year) shocker?
     
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  16. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    That Stirling link road seal job is way overdue, and given that one’s not talking pristine bush here, the optimisation of Buller traffic flow achieved would more than make it worth it.

    VNPA has resisted it consistently, but they are unrealistic about what the state of the forest is in the area, and the loop won’t ruin Stirling, as the majority of the space would remain as it is.

    State government just has to get its act together.
     
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  17. emkae

    emkae One of Us Ski Pass: Gold

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    How is market share measured in this case? Is it visitor days? Revenue? Other?
     
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  18. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    See here:

    https://www.ski.com.au/xf/threads/latest-visitor-numbers.82242/page-3#post-3674454

    “Buller consistently pulling numbers equal to FC & Hotham combined w.r.t. visitor numbers but a different story w.r.t. visitor days with Falls/ Hotham at 75% of Buller there. - day tripper vs. overnights - distance from Melbourne clearly the issue.”
     
  19. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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  20. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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  21. CarveMan

    CarveMan Pool Room Ski Pass: Gold

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    VNPA end game is to remove Stirling from the RMB and put it back to the National Park, which would of course be the thin end of the wedge of stopping a lot of recreational activity in the area. Hopefully the gatekeepers don’t achieve that goal.
     
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  22. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    So much of Stirling is degraded by grazing and logging and is far from pristine.

    Given the scale of the Alpine zone in Vic and NSW the footprint of the resorts is small.

    Allowing the resort footprint to be used intensively for recreation actually limits disruptive ingress into the remaining area, limiting ecological disruption.

    On that basis extension of resort access and activity is arguably on balance an environmental positive.

    The resorts also have an awesome record of minimising environmental impacts and giving back to the community and boosting the regional economy.
     
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  23. CarveMan

    CarveMan Pool Room Ski Pass: Gold

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    Just thinking about it, Stirling is currently being used, very sparingly of course, by the people in residence currently at Buller. I’ve seen friends skiing Stanley Bowl and also some XC grooming appears to have been done.

    If it was in the Alpine NP it would be closed to all recreation right now.
     
  24. emkae

    emkae One of Us Ski Pass: Gold

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    2019 Days/visit

    Baw Baw 1.54
    LM 1
    Stirling 1.27
    Hotham 2.55
    FC 2.57
    Buller 1.36
    ALL 1.7
     
  25. snowgum

    snowgum One of Us Ski Pass: Gold

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    Im a bit surprised the average for Falls & Hotham isn’t into the 3s, given how many people I know personally who head Up for a week to 9 days, plus 1-2 weekends.

    I guess the local skiers must represent a fair % of visitation? Plus Melbourne 2-Day weekenders?
     
  26. snowgum

    snowgum One of Us Ski Pass: Gold

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    That would be a disaster for skiing and Recreation. I think the VNPA mean well, but don’t agree with the principle of low-impact park and a Forest areas. To them it’s black or it’s white. That said I’ve always opposed lifts on Stirling*. It would totally change the place and kill the BC vibe.

    * perhaps a portable rope tow would be handy in the bowl on a true POW day? ;):p:whistle:
     
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  27. emkae

    emkae One of Us Ski Pass: Gold

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    People staying off mountain and driving up each day?
     
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  28. CarveMan

    CarveMan Pool Room Ski Pass: Gold

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    And while the RMB doesn’t do a huge amount of maintenance on the MTB tracks on Stirling I hazard a guess they would do more than Parks Vic.
     
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  29. Seth

    Seth Pool Room Ski Pass: Gold

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    you could make a lot of blackberry jam on mount Stirling.
     
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  30. snowgum

    snowgum One of Us Ski Pass: Gold

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    yes it’s certainly needs a good spray along Stirling trail.

    Also needs rehab on the same - on my last walk, horse riders were using the designated walking path just above King Saddle. Probably happens all the time. Loved to death?
     
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  31. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    2015 Stanford Uni Case Study on Vail’s climate change risks:

    https://law.stanford.edu/index.php?...cation/868289/doc/slspublic/Vail_Final_DB.pdf

    More recent investment analysis Vail: https://www.barrons.com/articles/vail-resorts-can-rally-85-analyst-says-51591968335 (12 June 2020)

    September 2020: https://www.marketbeat.com/instant-alerts/nyse-mtn-analyst-earnings-estimates-2020-09/

    “The firm has a market cap of $8.76 billion, a price-to-earnings ratio of 56.20 and a beta of 1.24. The firm has a fifty day moving average price of $203.04 and a 200 day moving average price of $187.23. The company has a debt-to-equity ratio of 1.58, a quick ratio of 1.17 and a current ratio of 1.35. Vail Resorts has a fifty-two week low of $125.00 and a fifty-two week high of $255.37. Vail Resorts (NYSE:MTN) last issued its earnings results on Thursday, June 4th. The company reported $3.74 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.67 by $1.07. Vail Resorts had a net margin of 7.65% and a return on equity of 11.08%. The business had revenue of $694.09 million during the quarter, compared to analysts' expectations of $627.67 million. During the same period in the previous year, the company earned $7.12 earnings per share. The business's revenue for the quarter was down 27.5% compared to the same quarter last year.”
     
  32. Chookfooter

    Chookfooter One of Us

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    PE of 56.2, wow. Where do I buy?
     
  33. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    Buy soon, they are expected to report annual earnings 24/09...:whistle:

    High leverage, strongly suppressed earnings, expectations of future earnings, US share prices fueled by cheap debt.

    Nothing to do with real world valuations...

    Amazon PE ratio is 134....Tesla - 64

    Alphabet - 36.4 Facebook - 32.

    GE - 24 Microsoft 40, Ali Baba 32.

    BHP - 15, CBA - 13, CSL - 44....
     
  34. Chookfooter

    Chookfooter One of Us

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    I don't pay much attention to this stuff any more, I leave it to the experts for that, but when I looked after my own stuff the general concerned was a PE of more than 15 was starting to look overvalued. At 4 times that, I wouldn't go near it.
     
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  35. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    Amen!! This does suggest that Epic passes will go up in price... and cost control at Vail resorts will be the order of the day, and capital expansion will be on hold.... and they’ll try to push more volume through.

    Draw your own conclusions on the user experience....
     
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  36. robbo mcs

    robbo mcs One of Us Ski Pass: Gold

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    Epic pass prices have not gone up substantially. They are selling north american ones now for 20/21 season.

    Surely if they wanted to push more volume through they would reduce the priceo_O That is how classical economics supply and demand works. Can’t see how they can push up the price and push more volume through at the same time .... especially in a severe recession.

    They already announced at the start of the covid pandemic that all except required maintenence capex was on hold.

    US/AUS $ movements have been in their favour recently, as far as the ozzie business is concerned. I don’t think they are substantially hedged.

    Vails businesses are not broken. They are profitable, even now. Leverage and loan covenents etc are the problem. However, you have to remember, in the current climate lenders are very reluctant to play hard ball on debt.
     
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  37. Billy_Buttons

    Billy_Buttons Que Sera, Sera Ski Pass: Gold

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    Inside info locally that all capex is on hold for Oz.
     
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  38. telecrag

    telecrag Old n' Crusty Ski Pass: Gold

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    I believe KT are negotiating lease payments, I wonder how that works for Vail here? Is Perisher more or less expensive than Victoria resorts for the payments to government (lease lets call it)?
     
  39. Legs Akimbo

    Legs Akimbo Grumblebum Ski Pass: Gold

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    My understanding is that KT rents are a percentage of taxable income. KT accounts are quite creative and their rent is something south of bugger all. I could be wrong.
     
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  40. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    Agreed!
     
  41. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    And also all credit to Vail’s Perisher management.
     
  42. Chaeron

    Chaeron Ski-Hike-Blade-Bike-Kayak Ski Pass: Gold

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    Their lenders offered them an effective debt holiday in April and they also have enough cash to carry them through a poor 2020/2021 season.
     
  43. cold wombat

    cold wombat Twitter Contributer Moderator

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    Depends on price elasticity of demand.
     
  44. zac150

    zac150 A Local Ski Pass: Gold

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    they took out a $600m loan in April?

    I think the risk period for Vail is the next few months as a lot of their planning And confidence is based on people completing on their purchase of the passes which they have delayed.

    FWIW I think they will be okay, they will take a second big hit but I think the cash reserves will get them through. They have shown they will run lean if needed and of course the US seems to have a different view to everywhere else on the virus.

    I think the model will take a hit but in the long run it will come back.

    I listened to the podcast above and have to say I struggled, what a load of corporate BS! I would have had a lot more respect for Sonntag if he had said, the passes have been our policy it has helped the development of the company to where we are today and we wanted to stay the course.

    I do have more respect for vail a company but less respect for the corporate spin.
     
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  45. Aractus

    Aractus One of Us

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    I've a lot more to say about that Podcast, but I'll say it over in the Covid forum.

    However I will make this observation - Peter Sonntag said that pass holders "will always come first", and Stuart Diver said that they took the operational decision to not sell season passes as the best way to restrict visitor numbers. Both could be more forthcoming, particularly Vail in this instance. The Epic Aust. Pass was always a product that Vail uses to entice Australian skiers and boarders to their American & Japan resorts because they view Australian visitors as very profitable. With Thredbo, this is obviously not the case - they've dropped the season pass price to compete with Vail, but they don't get the benefits of having Australian skiers and boarders come to their overseas resorts and spend money. So in other words, Thredbo and Vail were in two completely different places at the start of the season: Thredbo makes their money here, Vail makes their money overseas, and that fact is the primary determinant over whether season passes could be offered in my opinion.
     
  46. DPS Driver

    DPS Driver A Local

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  47. telecrag

    telecrag Old n' Crusty Ski Pass: Gold

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    Interesting, he says they expect stronger visitation from regular visitors, over the holiday crowd, yet Thredbo I think proved the opposite this season. One thinks the money is in season pass holders, the other in the holiday makers. Are they both right?
     
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  48. robbo mcs

    robbo mcs One of Us Ski Pass: Gold

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    Perisher this year there were a lot more experienced skiiers, and many less beginners and family type trips. It was not only noticeable in the resort, but also on the road, where there were many less incidents than usual
     
    telecrag, Ozgirl, Ted Harper and 2 others like this.
  49. MarzNC

    MarzNC One of Us Ski Pass: Gold

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    How many cities does Thredbo draw from?

    VR has managed to cover multiple regions in the USA at this point.

    There is a new Northeast Epic pass option--Value or Midweek--that is useful for people in Washington DC, Philadelphia, New York City, New Jersey, Boston, and points in between. Many people in the northeast don't want to risk getting on a plane this winter. The kids are most in virtual school. A lot of parents who are skiers are working from home. Bottom line is that there are a lot of families who will not be stuck only skiing during the holidays. The families who make the effort to ski will be those with parents who think skiing/boarding is fun, meaning they are less likely to be non-skiers who just want the kids to learn.

    Same could be said for the midwest (IL, MN, WI, MI, IN, OH) where the primary city markets include Chicago, Minn./St. Paul, Detroit, Cleveland, and Cinncinnati. Not sure what the K-12 schools in that region are doing but I think in the cities few are going to in-person classes. Pretty sure colleges are have longer winter breaks to avoid students going home for the American Thanksgiving and then returning to campus.

    California colleges are all online only. K-12 probably mostly online. Fewer people want to fly to Utah or Colorado. That means they plan to drive to Tahoe. Or move to Tahoe for the entire winter season.

    In all regions, the seasonal rental market and sales of homes is off the charts busy. Presumably people moving to ski country include people who like snowsports. Some used to be "holiday travelers" for ski vacations but will be "locals" for this season.

    Epic passholders do seem to trust that the VR reservation system will work. With Alterra and independent destination resorts using limits on season pass sales and no discounted day tickets to try to avoid requiring reservations for lift access, VR resorts seem to be at an advantage at the moment.
     
    Chaeron likes this.
  50. skiflat

    skiflat Old n' Crusty

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    Commenting on the Company’s season pass sales for the upcoming 2020/2021 North American ski season, Katz said, “Given the challenging circumstances surrounding the impacts of COVID-19, we are very pleased with the results of our season pass sales to date. Season pass sales through September 18, 2020 for the upcoming 2020/2021 North American ski season increased approximately 18% in units and decreased approximately 4% in sales dollars as compared to the period in the prior year through September 20, 2019, with sales dollars for this year reduced by the value of the redeemed credits provided to 2019/2020 North American pass holders. Without deducting for the value of the redeemed credits, sales dollars increased approximately 24% compared to the prior year.

    Through September 18 we have sold a total of approximately 850,000 passes for the upcoming North American season, which compares to approximately 1,140,000 total passes sold for the North American season last year through December 2, 2019.”
     
    cold wombat and Chaeron like this.