Vail Resorts braces for tough winter
Aspen, CO Colorado
VAIL, Colo. ” Skiers are putting off vacation plans. Visitors who do come to Vail will be spending less. And Vail Resorts is sure it’ll make less money this season.
Plenty of gloomy prognostications were aired Tuesday to a standing-room-only crowd that came to hear town leaders address how the resort will face the struggling economy.
“I think it behooves everyone in our company, and in my view, everyone in the community, to understand that what we’re going to see this year is very different,” said Rob Katz, CEO of Vail Resorts, noting that Vail is coming off several years of prosperity. “The change that we’re going to see … is going to be tough.”
But Katz pointed to a bright side, too, saying that the company remains financially strong and the downturn is an opportunity to position Vail for success.
Katz was joined by Mayor Dick Cleveland, former Councilman Kent Logan and resort expert Ralf Garrison on an economic panel. About 150 people, many of them local business owners, filled the audience.
Hotel bookings are down, “not just 1 or 2 percent,” but “significantly,” for next season, Katz said, adding that the high-end East Coast skiers who come to Vail in droves have been especially hard hit by the financial meltdown.
“There will be less people coming, and even those coming will spend less, even on the higher end,” Katz said.
For instance, Katz said, some people will hire just one ski instructor for their visit instead of two.
Katz noted that the company’s stock is down 60 percent over the last year, but said that’s relatively good compared to other resort companies. Vail will continue to emphasis a great “guest experience,” Katz said, touting $200 million in improvements to the mountain over the last several years.
“No matter what happens, the guest experience will not be compromised,” he said.
The company is introducing several new promotions ” including the Epic Pass ” that aim to keep people coming to Vail despite the economic troubles, Katz said.
Cleveland said the discount Epic Pass will help a lot.
“I think the guy who came up with the Epic Pass should get a bonus this year,” he said.
The mayor advised the owners of Vail stores and restaurants to keep their attitudes “upbeat.”
“Give people what they came here for, which is an escape from the outside world,” Cleveland said.
The town will continue to provide service like snowplowing and free buses, Cleveland said.
“The level of service will not drop in the 2008-’09 ski season,” he said.
Logan, a retired investment banker, said he expects this winter to be the most difficult for Vail’s economy since the town’s founding.
“We must act now, and we must act boldly,” he said.
Logan suggested that the town allocate an additional $1 million toward marketing Vail in winter. In addition, Vail’s marketing district should shift its emphasis from marketing Vail’s summer to marketing Vail’s winter, he said.
Garrison said Vail’s economy needs to prepare for a “new normal” of expectations.
“The extent of the ‘new normal’ is yet to be seen,” he said.
A lot of attendees had questions or comments for the panel.
George Knox, owner of the Moose’s Caboose in Vail, said parking rates need to be reduced. Plus, there should also be fewer police officers patrolling the interstate, Knox said.
“This is a bad image,” he said.
Michael Hecht, a local developer, said he thinks Vail Resorts and the town of Vail should work together and put any rocky relations behind them.
“It doesn’t do any good for us to air our dirty laundry,” Hecht said.
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