Poor exchange rate doesn’t deter Aussies

Scott Condon
The Aspen Times

top ski destinations for australians

Travelplan Australia is one of the major travel operators in the world for Aspen. Here are Travelplan’s top three markets:

1. Aspen

2. Whistler/Blackcomb

3. Niseko, Japan

The weak Australian dollar hasn’t prevented travelers from Aspen’s top international market from hitting the slopes in droves this month.

Representatives of Aspen Skiing Co. reported that lift-ticket sales to Australian and New Zealand customers are pacing ahead of last year, and representatives of most lodging properties contacted said their numbers are even with or better than recent winters.

The North of Nell Condominiums are booked with about 85 percent Aussies through January and into February, according to General Manager Joe Raczak.

“It’s about par with prior seasons,” Raczak said.

“Our bookings start in March, and we do fear some headwinds for Aspen, as the Aussie dollar is expected to drop a further 10 percent in 2015.”
David Withers, managing director, Travelplan Australia

Frias Properties, which manages hundreds of condominium and hotel units in and around Aspen’s downtown core, is up about 8 percent for business from Australia from November through April compared with last year, according to Eileen Tucker, director of sales and marketing.

“January is just off the charts,” she said. February and March are flat compared with last year, but last year was a very strong year, she noted.

Kristi Kavanaugh, managing director of worldwide sales for Skico, said Australia and New Zealand are showing the most significant increase in lift-ticket sales year over year among the company’s international markets.

“We put some aggressive promotions in the market to book by June 2014 for this season, and they produced great returns,” Kavanaugh said. “We will be doing something similar for next season, as well.”

Aussies shrug off weak dollar

David Withers, managing director of Travelplan Australia, one of the largest tour operators in the country, said in an email interview that the plummeting exchange rate of the Aussie dollar with the U.S. dollar didn’t have a huge effect on sales for the 2014-15 winter. Pricing for a U.S. ski vacation was 10 percent higher than the prior winter when sales started back in March for a trip this winter, he said. Prices increased another 15 percent during the heart of the selling season.

“However, the main drop in the (Australian dollar) occurred after our main selling season — April to August — when 85 percent of our clients had booked and committed to travel,” Withers said.

Travelplan’s revenue from Aspen trips is up 27 percent from last season in U.S. dollars, Withers said. He called that surprising, “considering the currency situation, and most competing destinations don’t have the same currency issues.”

As of Sunday, an Aussie dollar was worth 81 cents to a U.S. dollar.

Australians on the slopes at Aspen Mountain on Friday said they weren’t letting the weak Aussie dollar spoil their vacations. Jack and Suzi Nolan, visiting from Sydney with their daughter, said this was their fifth year in a row of taking a vacation to the U.S. Suzi said she thinks twice about buying clothes because of the weak Aussie dollar, but they still are willing to spend what it takes to dine out.

At this point, they don’t foresee avoiding travel next year because of the exchange rate.

“If it got down to around 70 cents, we’d really have to think hard,” Jack said.

Richard and Anna Allsopp made the trip from Australia to Aspen with their three children. The weak Aussie dollar “makes it harder to handle” but really hasn’t curtailed their spending, they said.

“You’ve got to enjoy yourself,” Richard said.

Trouble ahead in 2015-16?

Withers said Travelplan hasn’t experienced people trying to cancel their vacations because of the falling Aussie dollar. However, it’s uncertain at this point what the effect will be on travel for the 2015-16 winter.

“Our bookings start in March, and we do fear some headwinds for Aspen, as the Aussie dollar is expected to drop a further 10 percent in 2015,” he said.

U.S. destination ski resorts covet foreign travelers because they stay for longer vacations, typically 10 to 14 days. International guests tend to book well in advance, giving property managers some peace of mind for the coming season.

Raczak said travelers from Australia buoyed Aspen during the recession, when domestic travel dropped significantly.

“Aspen wouldn’t have survived the last number of years without the Australian market,” he said.

It’s too early to say how the international market overall will shake out for Aspen Snowmass and other resorts this ski season, but all signs point to an increase in sales. Kavanaugh said Skico expects to sell more lift tickets to international guests this season than the previous season.

The National Ski Areas Association, a ski-industry trade group, commissions a thorough study at the end of each season. That examines international markets for the ski industry, among myriad other statistics.

Warm-weather competition

Tom Foley, operations director for DestiMetrics, a company that works with several western U.S. resorts to track reservations data, said the firm doesn’t collect data specifically on international travelers but that there’s a wealth of anecdotal information.

“There are challenges that face international travel right now,” Foley said. Chief among them is poor economic performance in many countries other than the U.S. Thus, the currency of just about every major international market for U.S. ski resorts is weak compared with the U.S. dollar.

That’s somewhat offset by the fact that many international travelers tend to be wealthy, with household incomes well above average, he said. The types of families that travel to the U.S. for a ski trip can more easily absorb the weak currency than the average family, according to Foley.

When it comes to international business, the ski industry tends to have “blinders on,” Foley said.

“Ski resorts think the competition is two states over,” he said.

The real competition is Florida and other warm weather destinations, he said. Florida attracted 94 million visitors last year. The percentage of those visitors from the United Kingdom was in the double digits, he said. The U.K. is also one of Aspen’s main international markets.

Foley said a continued strong dollar could affect U.S. destination ski resorts in a couple of ways next winter. Fewer international travelers might venture out.

“People are going to spend less, and they’re going to find some other way to spend their discretionary dollar,” Foley said.

The flip side of the coin is that people in the U.S. might be more tempted to travel overseas because their dollars stretch further, according to Foley. Some of those travelers will be people who otherwise would take a ski vacation, he said.

Withers said Travelplan’s Aspen business dropped in 2000 when the Aussie dollar weakened and prices soared at U.S. ski resorts.

“Whistler (British Columbia) became our No. 1 resort, even more so after Sept. 11,” he said.

But Aspen rebounded strong. Travelplan’s Aspen business has grown “tenfold” since the early 2000s, Withers said. Aspen is “by far” Travelplan’s top resort in the world, and the company has become one of the top tour operators for Aspen, if not the top, he said.

Whistler is a distant second to Aspen, and Niseko, Japan, is the third top market for Travelplan, according to Withers. Within the U.S., Vail and Steamboat trail Aspen as leading ski-resort destinations, he said.

“Aspen is the fashionable place to ski for Australians, and the ski company has created very effective products to cater for this long-stay market. The properties have followed suit,” Withers said.

“It will be hard to stop Australians coming to ski Aspen even it we wanted to,” Withers concluded.

Reporter Karl Herchenroeder contributed to this report.