Vail Resorts is buying Peak Resorts.

[cdskier]

I am pretty sure that Vail already owns resorts in other countries.

Yes, 3 in Australia (2 of which they just purchased earlier this year). I wouldn't at all be surprised to see additional acquisitions in other countries though.

 

[Funky_Catskills]

I went to Vail my first trip out west. I much rather go 1 state to the west of Vail for many reasons

Because Colorado doesn't have any other good areas right?

 

[thetrailboss]

Yes, 3 in Australia (2 of which they just purchased earlier this year). I wouldn't at all be surprised to see additional acquisitions in other countries though.

Yeah, I thought it was Australia.

 

[thetrailboss]

And for those wondering what is going on with Attitash's Summit Triple:

"We will resume work on the repairs immediately after Labor Day when the summer crowds disperse," Lowell said Monday. "It would be unsafe to have work going on now while we have attractions and families wandering near the work areas. The rebuilt pieces will be delivered the last week of August so we can begin to get organized with heavy equipment to place the pieces back into the motor room and raise the bull wheel.

"Everything is going as planned, and I am confident the summit triple will be ready for the start of the upcoming season. We have also done a near-complete rebuild of the Flying Yankee this spring. We are installing a new drive in the Abenaki lift and have done extensive work on the Flying Bear. Our lift maintenance staff have been working extremely hard this spring and summer and will continue to do whatever prudent to make our lifts reliable and safe for this season and seasons to come."

https://www.conwaydailysun.com/news...cle_b9f5c9c0-acb5-11e9-a347-3b3870d0c67e.html

 

[EPB]

Um, thanks for the lesson, I guess. I dispute nothing you just said. What I dispute, one again, is abc's idiotic claim that the reason for the acquisition was to funnel more eastern skiers to Vail's western resort, in particular, to Vail's hotels and restaurants in Vail village. If this acquisition only made sense to Vail because of some projections on how it would impact visits to its western holdings, then everyone should divest their stock in Vail immediately.

Okay I think he's more right than you are on this one. The way I'd think about it is in terms of regions. The Midwestern thesis has already played out in MN, greater Chicago and MI.
Vail thinks that it can get people from greater NYC and all points north and east to spend more money at Vail than they would have on Peak plus Vail products than they would have as separate companies. You can do this in a few ways:
1) Get new people to buy Epic passes because they can cover admissions for eastern and western trips (e.g. NYC family skis Mount Snow over Xmas and Colorado over spring break)
2) Get more people to buy Epic passes because they like the broader eastern options (e.g. Boston area skier now buys from Vail because they love that they can ski the MWV and Stowe on the same pass)
3) Raise prices on premium pass options (by limiting days to Snow, or blacking out vacation weeks), food and beverage, gift shops, etc.

I don't know which is the biggest bucket, but if you told me #1 was the biggest bucket, I wouldn't be surprised. If you don't get this, you're probably not the right demographic for bucket 1 and you probably don't rub elbows with that type of crowd. That doesn't mean that demographic doesn't exist and represents a key merger rationale for Vail.

#2 is limited by real estate constraints - need a place to stay at two different eastern resorts. It's possible work Airbnb, but probably won't move the needle too much.

#3 is either enhanced by the western option (people want to go to Mount Snow on Xmas and west over spring break and need a more expensive Epic pass to make it work), or it corrects weak pricing by Peak (i.e most people would have spent more for a Mount Snow pass than Peak was charging).

What I hear you saying is that #2 is the big reason why Vail bought Peak. I think it helps on the margin, but misses the bigger picture/opportunity set.

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[Edd]

And for those wondering what is going on with Attitash's Summit Triple:



https://www.conwaydailysun.com/news...cle_b9f5c9c0-acb5-11e9-a347-3b3870d0c67e.html

Never going away.

 

[Smellytele]

Never going away.

As someone said the triple at attitash is possessed and will not allow anyone to replace it or it has comprising pictures of someone.


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[Domeskier]

The way I'd think about it is in terms of regions. The Midwestern thesis has already played out in MN, greater Chicago and MI.
Vail thinks that it can get people from greater NYC and all points north and east to spend more money at Vail than they would have on Peak plus Vail products than they would have as separate companies.

The eastern market is a lot different than the Midwest, though. If Midwestern skiers get bored with their feeder hills, there's not much they can do but jump on a plane. Encouraging those skiers to jump on a plane to a Vail resort generates a nice return on investment for the relatively small acquisitions they made out there. On the east coast, skiers who get bored with their feeder hills in NY/NJ/CT/PA can drive a few hours north and ski legitimate terrain in VT/NH/ME and upstate NY without the hassle of flying west. If you want to capture a significant number of those skiers, you need provide access to major resorts in the east. Most of the eastern skiers I know who already spend a significant amount of time and money out west rarely ski the east anyway and certainly aren't buying season passes to eastern mountains. Maybe the option of doing some warm-up runs at Hunter in advance of a trip out West will encourage them to get an Epic pass and lock themselves into a Vail-cation. Who knows. I just do not see how a $250+ million acquisition in the eastern US, replete with destination resorts like Stowe, is part of some myopic strategy to increase skier visits to Colorado (any more than their acquisitions in the PNW or British Columbia were). I see this more as signal that Vail is shifting focus from being a major player in the western US to being a major player nationally and internationally. The fact that the press release indicates that they have already earmarked $15 million for improvements at their eastern resorts over the next two years belies abc's claim that Vail will not invest in its eastern mountains for fear of competing with its western resorts.

 

[Domeskier]

1) Get new people to buy Epic passes because they can cover admissions for eastern and western trips (e.g. NYC family skis Mount Snow over Xmas and Colorado over spring break)
2) Get more people to buy Epic passes because they like the broader eastern options (e.g. Boston area skier now buys from Vail because they love that they can ski the MWV and Stowe on the same pass)
3) Raise prices on premium pass options (by limiting days to Snow, or blacking out vacation weeks), food and beverage, gift shops, etc.

I would just further note that none of these reasons (which are all legitimate) implies that Vail's primary intent was to "buy eastern resorts to get more people to spend money in Vail Village." At the end of the day, as you correctly point out, Vail made these acquisitions to sell more epic passes, and it will make a lot more money on the sale of these passes and running its eastern holdings than it will ever make by getting more eastern skiers to stay at its Colorado hotels and eat in its Colorado restaurants.

 

[EPB]

The eastern market is a lot different than the Midwest, though. If Midwestern skiers get bored with their feeder hills, there's not much they can do but jump on a plane. Encouraging those skiers to jump on a plane to a Vail resort generates a nice return on investment for the relatively small acquisitions they made out there. On the east coast, skiers who get bored with their feeder hills in NY/NJ/CT/PA can drive a few hours north and ski legitimate terrain in VT/NH/ME and upstate NY without the hassle of flying west. If you want to capture a significant number of those skiers, you need provide access to major resorts in the east. Most of the eastern skiers I know who already spend a significant amount of time and money out west rarely ski the east anyway and certainly aren't buying season passes to eastern mountains. Maybe the option of doing some warm-up runs at Hunter in advance of a trip out West will encourage them to get an Epic pass and lock themselves into a Vail-cation. Who knows. I just do not see how a $250+ million acquisition in the eastern US, replete with destination resorts like Stowe, is part of some myopic strategy to increase skier visits to Colorado (any more than their acquisitions in the PNW or British Columbia were). I see this more as signal that Vail is shifting focus from being a major player in the western US to being a major player nationally and internationally. The fact that the press release indicates that they have already earmarked $15 million for improvements at their eastern resorts over the next two years belies abc's claim that Vail will not invest in its eastern mountains for fear of competing with its western resorts.

I hear you - I'd also count Stowe in the resort bucket along with Vail, PC, Whistler and the like. In some ways what you and I are saying is similar - resort/feeder is the delineation that matters. Not necessarily east/west (although that's mostly how it breaks down).

Stowe is a hybrid because Stowe regulars are definitely more likely to go to Vail resorts for their trips out west, but there will surely be a Hunter/Crotched/Jack Frost contingent that will take their one big trip to Stowe. To a lesser extent, this could be true at Okemo, Snow or the MWV, but those are more weekend destinations for those who liveveast and north of NYC.

I still think the driving force for your casual & wealthy skiers to the new Epic pass is an east and west resort option under one umbrella. There is just a massive amount of wealthy casual skiers up for grabs from NJ through suburban NH with the east-west value proposition. Remember, for those in parts of the NYC metro, it's easier (albeit more $$$) to get on a plane to PC than it is to drive to Stowe.

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[cdskier]

The fact that the press release indicates that they have already earmarked $15 million for improvements at their eastern resorts over the next two years belies abc's claim that Vail will not invest in its eastern mountains for fear of competing with its western resorts.

$15M over 2 years split between 17 resorts is sort of weak in all honesty. Obviously it won’t be distributed equally, but still that number doesn’t impress me without any details on what they have in mind.


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[EPB]

$15M over 2 years split between 17 resorts is sort of weak in all honesty. Obviously it won’t be distributed equally, but still that number doesn’t impress me without any details on what they have in mind.


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I forgot to mention this, but it's true. I could identify $15 million of spending that Vail should seriously consider in the MWV alone.

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[Domeskier]

I still think the driving force for your casual & wealthy skiers to the new Epic pass is an east and west resort option under one umbrella. There is just a massive amount of wealthy casual skiers up for grabs from NJ through suburban NH with the east-west value proposition. Remember, for those in parts of the NYC metro, it's easier (albeit more $$$) to get on a plane to PC than it is to drive to Stowe.

Yeah, I just wonder how many of these wealthy casual skiers would even care about eastern pass options. If your primary focus is on skiing out west, then what matters most to you is what western resort you want to ski at, rather than what eastern mountains are offered on the same pass. If you prefer Jackson or Aspen over Vail, you'll get an Ikon pass even if you'd prefer skiing Stowe over Killington or whatever the comparable Ikon offering is.

 

[VTKilarney]

If Vail's motivation was ONLY to drive skiers to Vail, they would not offer the EPIC pass. Each local hill they own would have its own pass that was good for that local hill and Vail only.

 

[Domeskier]

$15M over 2 years split between 17 resorts is sort of weak in all honesty. Obviously it won’t be distributed equally, but still that number doesn’t impress me without any details on what they have in mind.

True. I assume it will be funneled mainly to Stowe and the other top destination resorts. But however you slice it, no amount of investment in Stowe or any other eastern resort is going to cause someone not to decide that a ski trip out west is not worth it.

 

[Domeskier]

If Vail's motivation was ONLY to drive skiers to Vail, they would not offer the EPIC pass. Each local hill they own would have its own pass that was good for that local hill and Vail only.

Well said.

 

[thetrailboss]

$15M over 2 years split between 17 resorts is sort of weak in all honesty. Obviously it won’t be distributed equally, but still that number doesn’t impress me without any details on what they have in mind.


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One thing that I have noticed is in the last two years or so Vail has reigned in its spending on improvements. In 2015 when the finally got their hands on Park City they dumped a TON of money into that area. Since then though they have only made some modest improvements. And, as I mentioned with Crested Butte, even though there are a lot of older lifts that need replacing, Vail has opted for a less expensive fixed-grip lift instead of multiple high speed lifts.

 

[EPB]

Yeah, I just wonder how many of these wealthy casual skiers would even care about eastern pass options. If your primary focus is on skiing out west, then what matters most to you is what western resort you want to ski at, rather than what eastern mountains are offered on the same pass. If you prefer Jackson or Aspen over Vail, you'll get an Ikon pass even if you'd prefer skiing Stowe over Killington or whatever the comparable Ikon offering is.

Understood - short guess is that the casual fan is likely to lack that level of conviction. Vail has big name resorts, and I think most people are fine to just pick one (unless their brother has a place at Jackson, for example). A week "out west" and maybe a week or a couple of weekends "in Vermont" is about as specific as you need to get. Only the full ikon gets you unlimited access to a US east coast resort (Stratton) while Vail now has many more options thanks to Peak. The simplicity and variety of Epic and Epic Local passes provide compelling value.

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[EPB]

One thing that I have noticed is in the last two years or so Vail has reigned in its spending on improvements. In 2015 when the finally got their hands on Park City they dumped a TON of money into that area. Since then though they have only made some modest improvements. And, as I mentioned with Crested Butte, even though there are a lot of older lifts that need replacing, Vail has opted for a less expensive fixed-grip lift instead of multiple high speed lifts.

True, but remember they did the same at Whistler that they did at PC.

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[cdskier]

True. I assume it will be funneled mainly to Stowe and the other top destination resorts. But however you slice it, no amount of investment in Stowe or any other eastern resort is going to cause someone not to decide that a ski trip out west is not worth it.

Since the announcement was included in the press release on the peaks acquisition, I would expect none of that $15m to go to Stowe.


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