After last week’s examination of the seemingly unstoppable juggernaut, Vail Resorts, (Senior Skiers Sound Off – Vail…Beauty or, the Beast? ) I had planned to put out something a tad more light-hearted. After all, the season is winding down and we need to maintain the stoke for the 2017-18 season, yes?
But, you can’t let news like this just slip by. In recent news, the Aspen Ski Company has announced an agreement to buy Intrawest for $1.5 Billion. Intrawest owns Winter Park and Steamboat Springs in Colorado, Mount Tremblant in Canada, Stratton in Vermont and 3 other resorts.
Does this signal a head-to-head slug fest? Crown versus Katz, in the street at high noon, for primacy in the North American snow sports market? Will this touch off a kind of Corporate Chinese Downhill where competition serves the marketplace by driving down prices? Doubtful.
As we have seen with VR acquisitions, traffic goes up and prices go up. While season pass prices have gone down compared to 20 years ago, the total cost of a ski vacation has risen.
As Aspen enters the corporate snow sport fray, we won’t know how they intend to manage these new properties until they actually begin operations. If they are to echo the Aspen Experience, we have to assume they will want to draw their business from the higher income brackets. Today’s announcements that not much will change seems carefully calculated to insure stability in share prices until the merger can be completed.
To think a management team, driven in the public eye by the Aspen name, will go off into the future without even taking advantages of economies of scale is naive in my view.
Everywhere that has happened it tends to pull prices for all goods and services upward, out of reach for the average senior skier. This is yet another signal of a kind of “gentrification” of the lift served snow sports market. Have Senior Skiers Been Abandoned? The Wrinkled Irrelevants…
From Wikipedia, In the US, the Centers for Disease Control and Prevention report Health Effects of Gentrification defines the real estate concept of gentrification as “the transformation of neighborhoods from low value to high value. This change has the potential to cause displacement of long-time residents and businesses … when long-time or original neighborhood residents move from a gentrified area because of higher rents, mortgages, and property taxes. Gentrification is a housing, economic, and health issue that affects a community’s history and culture and reduces social capital. It often shifts a neighborhood’s characteristics, e.g., racial-ethnic composition and household income, by adding new stores and resources in previously run-down neighborhoods.”
What we are likely to see in the coming years is an economic stratification, which also implies racial and ethnic stratification, in lift-served snow sports. Those who can afford the Disney-esque immersion, that is now being called “experiential” skiing, will likely appreciate the up-market move.
But, this up-market move does two things. It relegates those who cannot afford the “experience” to venues who will struggle to keep the lifts running, and it vacates the mid-priced segment.
In other industries that has tended to pull prices upward across the board. In an industry that has struggled to find new customers for 20 years, it does not bode well. It is an industry for which the cost barrier for new client acquisition is already significant.
Should the gentrification of snow sports pull prices upward away from its blue-collar roots, it may well accelerate the closure of down-market venues; more crowding, and further economic stratification, as the industry bleeds customers from the lower income brackets. Perhaps the Alt-Ski community will see some growth ( Seniors Skiing on the Cheap – An Alt-Ski Community )
In that light, numerous programs to introduce poor urban kids to snow sports almost becomes a form of mockery. “Hi kiddies and welcome! We hope you love skiing and riding now because you will never be able to afford it when you grow up”. My more libertarian sensibilities cringe at the notion of public lands being used to enrich the lives of a relative handful while driving their availability to others downward.
“From All according to their lobbyists, To those few who can afford them” – flies in the face of American democratic traditions.
As snow sports become less and less affordable, the Aspen-Vail cage match may well create a hue and cry that endangers these government granted monopolies that operate on public property,
The “multiple use” policy of the US Forest Service ought to have limits that serve the interests of all. In the same way that a vacation to a national park has become corporatized, less affordable and less enjoyable through government granted monopolies, so too may seniors’ skiing.
In the last 20 years the number of active snow sport participants has held steady at around 12 million per season. According to the National Ski Area Assoc. there were 622 ski resorts in the 1988-89. Today, according to a chart at the Statistics Portal there were 463 during the 2015-16 season.
That’s the same 12 million people skiing and riding on 159 fewer resorts and a LOT less acreage.
We seniors skiing on these crowded slopes can testify that you have to have the vigilance of a combat veteran to get through the day. Eyes in the back of your head and your head on a swivel, just isn’t fun. Senior skiing ought to be about a sense of freedom…not survival.
With over-crowding and collision injuries on the rise today, if this trend continues, the remaining slopes promise to only bring a degradation of the snow sport experience. And, that drives down demand (fewer skiers) and drives up prices even further. Up to a point that perhaps not even the Godzillas and King Kongs of corporate skiing cannot afford to remain in business.
Many people have reported a marked increase in congestion at VR acquired resorts. Aspen’s entry into gentrification may well accelerate the twinkly-light, gourmet-dining but over-crowded “experience”. Where you are seen in ski togs becomes more important than the quality of the on-snow experience.
Shops and hotels and restaurants in these acquired areas love the increase in traffic but that increase also adds unforeseen burdens on public infrastructure. Everything from constructing parking to traffic management systems to sewage and trash collection costs more in government expenditures.
Tax increases always happen whenever governments see the opportunity. Increased taxation tends to drive out locals on the lower economic strata. Homeowners who have lived in these town all their lives can no longer afford to remain and Gentrification becomes complete.
Back in the late 70s and early 80s, the focus of “smart money” in snow sports stopped being about skiing and started being all about real estate development in the area around resorts. Now that that fad has hit the wall and slid to the floor, I see this “corporatization” as an extension of that trend. It is just that the only remaining, available real estate in a ski town these days are the resorts themselves.
Once this fad has run it’s course and the stocks in these corporate giants stagnate, what will “smart money” do? Leave? Then what?
While the costs of a season pass might go down in the short term, the long term social costs in terms of diversity may well be unacceptable and unsustainable.
We do have a feel for where the upper limit is with this Gentrification movement. The once ballyhooed ultra-posh private Yellowstone Club near Big Sky has changed hands more times than a Christmas fruit cake. As Vail and Aspen probe upward looking for that line they dare not cross, the less-than-posh can only wait and ski.
Many people herald these acquisitions as if they represent the cavalry charging over the hill to the rescue. Well, the cavalry eventually retires back to its fort and we all know what a herd of horses leaves in the yard….and who has to clean it up
Time will tell.