Q&A: Aspen resort official Bill Tomcich discusses air service, lodging outlook
November 27, 2007
Editors note: Inside Business, published Tuesdays by The Aspen Times, posed some questions to Bill Tomcich, president of Stay Aspen Snowmass, an organization that books lodging reservations for the resort. Tomcich, who also is the community liaison to the airline industry, offered his insights on the upcoming season. Here are his responses:Aspen Times: Could you tell us a little about your background?Bill Tomcich: I was originally hired by the Aspen Skiing Co. from Vail Associates in June of 1995 as managing director of travel services, and was responsible for managing the relationships of all the airlines that were serving our market and recruiting new airlines and routes. In 1998, I was appointed to the position of president of Aspen Central Reservations, although I continued to maintain my role as this community’s primary liaison with the airlines. In October 2001, Aspen Central Reservations merged with Snowmass Central Reservations to create Stay Aspen Snowmass, the reservations company owned one-third by the Skico, one-third by the Aspen lodging properties, and one-third by the Snowmass Village Resort Association.AT:Delta Air Lines recently announced it’s going to fly direct into Aspen from Atlanta. You said it was the most exciting announcement in your 12 years here. Why? BT:Delta Air Lines operates service to more worldwide destinations than any airline (317 cities in 55 countries to be exact). Atlanta is not only Delta’s largest hub, it is in fact the world’s largest single connecting hub with overseas nonstop flights to more than 50 destinations throughout Europe, the Middle East, Africa, Central and South America. Direct connections from the world’s largest airline hub into Aspen/Snowmass will open up more convenient connecting opportunities for international visitors than any other conceivable route. If passengers prove willing to pay the premiums that will be required for this flight to be profitable enough to overcome the weight-restrictions that will be imposed on the outbound flight so it can take on enough fuel for the 1,304-mile flight to Atlanta, I could see this flight expanding to daily service in the future with one-stop connections from markets we have never dreamed of.AT: What are the potential impacts locally if Delta and United merge? BT: Thankfully, it appears this news was nothing more than a rumor.If it were to happen, a Delta and United merger would result in reduced competition and likely increased fares for communities that rely on competing service from both airlines, especially for communities like ours that rely on competing service from both the Denver and Salt Lake City hubs.AT: What are the three most attractive U.S. markets that Aspen doesn’t serve? Are you doing anything to capture them? BT:New York City, served by three airports, is by far the most attractive market not currently served by nonstop flights into Aspen/Snowmass, but the performance of today’s aircraft relative to our existing runway length and surrounding terrain render that route impractical for commercial airlines in the foreseeable future. Other than reinstating service recently lost by Northwest Airlines from their hubs in Minneapolis/St. Paul and Memphis, the three most attractive and realistic markets that I see as viable nonstop routes from Aspen/Snowmass are American’s hub in Dallas/Ft Worth, Continental’s hub in Houston, and even U.S. Airways’ hub in Las Vegas. In every case, the limiting factor is the aircraft performance within each carrier’s fleet relative to the amount of fuel required to reach each market. For example, Northwest Airlines 76-passenger aircraft on a short hop to Denver would not be a problem. But Northwest’s nearest hub is 802 miles away in Minneapolis, and in order to take on enough fuel to operate that flight nonstop, the airline would have to restrict their sales to fewer than 45 seats per flight in ideal conditions. To quote Northwest’s director of schedule planning, who I regularly stay in touch with just like his counterparts at American, Continental, Frontier and US Airways, “I’d be back in Aspen in a New York minute if we had an aircraft that could fly in without a weight restriction.” Maintaining my contacts with the commercial carriers and staying totally on top of emerging opportunities is what I am doing to capture those new market opportunities. That is exactly how we recently captured Delta Air Lines. Within days of sharing the news that SkyWest had figured out a way to overcome the operational hurdles of flying the CRJ-700 to and from Aspen for United Express, I had a commitment from Delta’s senior vice president of network planning to launch new flights from their Salt Lake City hub.AT: How many airline carriers would be optimal in Aspen? BT: As a general rule, the more airlines we have serving Aspen, the greater the competitive pressures will be to provide improved service and lower fares. That said, it is very important that the airlines be able to continue to operate here profitably. This winter, we are going to see more service from more cities than United has ever flown into any single ski destination other than their Denver hub. On Saturdays, for example, United alone is going to have up to 26 flights both in and out of Aspen/Snowmass 18 from Denver, four from Chicago, two from Los Angeles and two from San Francisco. Why are we suddenly being awarded with such extraordinary service? Because Aspen/Snowmass is a very profitable market for United, and with a fleet of 52 new CRJ-700s being flown for United Express, United now has more opportunities to operate aircraft and crews that were never before possible when Aspen was served by Air Wisconsin’s very limited fleet of BAE-146s. So, how many airline carrier’s would be optimal for Aspen? Certainly more than the three we have serving our market today. I am certain that a Frontier route from Denver with a Q-400 timed for optimum connections from our top domestic markets could do very well here year-round. Could our market support all this service? A return from Northwest from Minneapolis and Memphis, plus maybe some American flights from DFW, Continental flights from Houston, and expanded US Airways flights from Phoenix and even Las Vegas? I would say that it would ultimately be a function of how successful United is in fulfilling their promises to improve their service here this winter. If United truly delivers the best air service we have ever seen in Aspen this winter to go along with what is truly the best schedule they have ever built for our market, then I believe United will be successful in defending this lucrative market against potential competitors and the optimum number of airlines from what we have today may be just one or two more. If we see a similar or repeat performance from United of what happened last winter, then I believe every single aforementioned carrier and route, and then some, would do extremely well here as passengers flock to avoid repeating the travel nightmares so many have experienced in the past on United.AT: How will the increases in oil and gas prices affect airfaresinto Aspen this winter? BT:: Other than a recent $10 roundtrip fuel surcharge recently imposed by United Airlines for all domestic travel, I do not expect the recent increases in oil and gas prices to affect airfares in Aspen this winter at all. I expect more discounted fares to be offered into Aspen than were available last year. In fact, I would say that because of the high cost of gasoline, flying into Aspen will never have been such a bargain relative to the cost of driving than it will be this winter. As crazy as that may sound, airline pricing is seldom a function of the costs of delivering the service. It is generally a function of what passengers are willing to pay given other competing alternatives available.AT: Do you have a breakdown on how guests arrive here? How many people fly into DIA and drive from Denver, or fly into Eagle/Vail or Aspen? BT: Based on the most recent research conducted by the Skico, roughly 39 percent of winter visitors fly directly into Aspen. About 11 percent fly into the Eagle County Airport and either take ground transportation, or rent a car from there, while 36 percent of our winter guests now fly into Denver and drive from there. That number has been growing significantly in recent years as lower fares have made the drive from Denver a more tolerable option. With increased flights and more attractive fares into Aspen, I would expect more people to choose to fly directly into Aspen and fewer rental cars from Denver. This also is why we believe the market exists for a lot more commercial flights directly into Aspen than what is currently offered.AT: How are lodging bookings looking for the winter? BT: Winter bookings were originally off to a really strong start, but since the end of October, our pace relative to last year has diminished with our snowpack relative to average. Let’s face it, from now until Christmas, lodging bookings look pretty lousy, and that isn’t likely to change unless we see a phenomenal change in our weather patterns.International bookings are really strong this year because of the weak U.S. dollar, and for that reason, things look great from Christmas through Carnival, which is the second week of February. From the second week of February through the third week of March when Easter week falls, things don’t look so hot at the moment. We have a lot of rooms and airline seats left to sell during what is traditionally our high season.AT: Since you have been in the valley, what year was the ideal winter season in terms of business? Why? BT: The 1997/98 was truly the perfect season as everything came together. We had a strong economy, amazing early snow and great snow all winter, five airlines flying into Aspen, and more hot beds to sell in Aspen/Snowmass than we have seen for a long time since. AT: Could we ever get back to those numbers? BT: Certainly not this year. After more units come online in the future with the Limelight redevelopment and Snowmass Base Village, another perfect season may well be possible in the future.AT: How have the demographics of Aspen’s guest changed in the past 10 years? How do you think they will change in the next 10 years? BT: With the disappearance of most of Aspen’s economy lodges, a lot of guests who used to stay in those traditional ski lodges have disappeared. At the same time, there has been a remarkable shift toward younger demographics with the opening of Aspen Mountain to snowboarding and the hosting of the Winter X Games at Buttermilk. It’s too bad we couldn’t have seen this demographic shift of demand 10 years ago, before the supply of rooms ideally suited for them started to disappear.AT: How do fractional ownership condos get into the rental pool? BT: In many cases, the economic incentives for fractional owners to make their unused units available to short-term renters are strong enough for them to figure out a way to make it happen. In most cases, those units are offered for sale through property management companies like Frias Properties.AT: Have the negative effects of Sept. 11, 2001 leveled off locally?BT: In my opinion, the primary negative effect of 9/11 was a fear of air travel. I feel for the most part, those fears are long gone. Relatively speaking, air travel has never been safer, more convenient, or more affordable than it is today. It appears that the TSA is doing a far superior job at airport security than what existed prior to 9/11, and modern technology, electronic check-in units, and even Internet boarding passes has made the entire travel process of boarding an airplane more convenient.Air travel certainly isn’t as pleasant as it used to be as airplanes are more crowded than ever, a lot of planes are smaller and more cramped, and premium in-flight services are a thing of the past except on overseas flights. But it in most cases, you have to admit that it has never been cheaper or more convenient to fly from point A to point B than it is today.AT: What is your opinion on the overall state of the resort? BT: When I came to Aspen/Snowmass 12 years ago, this resort offered a great on-mountain product. There were plentiful options of accommodations available for our guests to stay, but air access was this resorts No. 1 limiting factor and perhaps this community’s greatest weakness. Today, the on-mountain product has never been better, but the availability and affordability of accommodations is far more limited, and we are coming off a year when airline service into our resort was a complete debacle. I believe that in very short order, air access into this resort is going to be transformed from what was once our greatest weakness to possibly our strongest selling point. But the availability of affordable accommodations, whether they be for our visitors to sleep or for our resort’s service employees to live, is going to continue to become a greater challenge.