Layoffs, cutbacks hit Vail Resorts
December 5, 2008
EAGLE COUNTY ” The nation’s economic slump hit home at Vail Resorts Thursday.
Vail Resorts CEO Rob Katz on Thursday sent an e-mail announcing several cutbacks, including 50 layoffs from the company’s year-round staff of 3,300. Another 92 open jobs were eliminated. In addition, the company delayed raises for many workers and announced that all executive pay would be frozen in 2009. Vail Resorts will also stop matching employee contributions to the company’s 401(k) plan next year.
The company is also reorganizing its marketing department, leaving people at its five resorts ” Vail, Beaver Creek, Keystone and Breckenridge in Colorado, and Heavenly in California ” but doing more centralized marketing from corporate headquarters in Broomfield.
The company refused to disclose what positions were cut or eliminated, or at which locations the cuts came.
Katz’s message cited the continuing national economic slump and a decline in lodging reservations as the reasons for the cutbacks. He also wrote that more cuts could come.
“I wish I could guarantee to everyone there would be no more changes,” Katz’s message stated. “But just like some of the smartest economic minds in the world are not sure what is coming next, we don’t know either. And in any event, there will always be more changes ” whether easy or hard to accept. The key is for us to stay ahead of whatever is coming.”
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Avon-based ski industry analyst Jerry Jones said Vail Resorts is probably on the right track.
“I think they’re doing the proper thing,” Jones said. “They’re looking at their forecasts, the number of rooms booked and passes sold.” And, Jones added, other companies are doing the same thing.
Intrawest, whose holdings include Steamboat Springs, Copper Mountain and the Whistler and Blackcomb resorts in Canada, announced its own round of layoffs recently.
“We had to be responsive to the economy,” Intrawest CEO Bill Jensen said.
Jensen, the former president of Vail Resorts Mountain Division, said Intrawest is trying to ensure that customer service isn’t affected by the cuts, a pledge Katz made in his message.
“We really went the extra mile to assure what we did didn’t affect guest service,” Jensen said.
So how can a company maintain guest service while cutting staff?
“It’s an overall business issue,” Jensen said. “You have to evaluate the efficiencies technology provides.”
While Vail Resorts’ cuts are small compared to its overall staff size, Jones said there are places a company simply can’t cut.
“The main thing is safety ” on lifts, in crowd control and so on,” Jones said. “I’m sure they’re not cutting back on those.”
Jim Cooper, manager of the Double Diamond Ski Shop in Lionshead, said he’s actually adding employees this year to beef up his customer service.
“I hate to hear about Vail Resorts’ cuts,” Cooper said. “I think we saw their on-mountain service was cut way too early at the end of last season.
“I think as long a they keep the on-mountain service great, we’ll be OK here,” Cooper said.
Former Vail Resorts president Andy Daly, now a Vail Town Council member, said he thinks the company will live up to its pledge to maintain service levels.
“It’s in their best interest to live up to that,” Daly said. “The whole community is sensitive to the fact that people coming this season are going to expect something extra.”
And, Jones said, Vail Resorts and Vail are in good position, all things considered.
“They have an opportunity to do better than anyone else in this climate,” Jones said. “They’ve got the Epic Pass. That’s a lot of skier days already in their basket.