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Alterra expects to sell 250,000 Ikon Passes, Vail Resorts says Epic Pass sales are up

Analysts are watching sales by the two Colorado-based resort giants for clues about the health of the North American ski industry.

Skier Conor Crowley makes his way down a trail at Aspen Mountain in 2016. The resort is one that can be accessed by Alterra's new Ikon Pass. (Nathan Hahn, Special to The Colorado Sun)
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VAIL — When executives from Vail Resorts and the nascent Alterra Mountain Company get together to discuss skiing, there are never fireworks. Or even a hint that the fiercely competitive rivals are locked in a raging season-pass battle.

This is not surprising.

Ski industry execs from competing companies do not gather in public meetings and disclose secrets or discuss strategies. They avoid saying anything that might rock the boat.

But there were some morsels dropped Tuesday at a ski panel during the annual Governor’s Tourism Conference in Vail that are worth noting.

First, Alterra’s head of sales Bob Stinchcomb said his company is poised to sell more than 250,000 Ikon Passes in the debut of the first multi-resort rival to Vail Resorts’ industry-shifting Epic Pass. That’s a strong projection for a first-year product.

But it’s important to note that the Ikon Pass replaced individual resort passes at Alterra’s recently acquired resorts, including Squaw-Alpine, Mammoth, Stratton, Tremblant, Winter Park and Steamboat. In many cases, the $899-$999 Ikon Pass marked a price drop compared with individual resort passes.

“We had high expectations and I’d say those have been exceeded,” Stinchcomb said, noting a “tremendous response” for the Ikon Pass from Colorado and California skiers. “We are not only seeing migration from competitors products into the Ikon Pass, we are seeing non-passholders migrate into the Ikon Pass and we still have eight weeks ahead of us with a tremendous amount of sales as resorts being to open.”

Skier David Paul at Utah’s Alta Ski Area. Alta is on Alterra’s new Ikon Pass. (Jesse Paul, The Colorado Sun)

Vail Resorts last month reported a 25 percent increase in Epic Pass sales and a 15 percent increase in sales dollars from June through September, a span when the company typically sells 50 percent to 60 percent of its season passes.

Vail Resorts marketing chief Kieran Cain said “a large portion” of that increase is from active military, veterans and their families taking advantage of the company’s $99 military pass, a promotion Vail Resorts launched this spring to celebrate the 10th anniversary of the Epic Pass.

“We have seen a tremendous amount of participation in that,” Cain said, adding that more than half of the military personnel taking advantage of that pass deal have never purchased an Epic Pass before. “I think it’s through segments like this that we can actually introduce new people to the sport.”

Vail Resorts typically raises the prices of its Epic Passes by about $100 every season. So it’s rare to see the number of passes sold increase at a faster pace than sales volume. The company’s fourth quarter fiscal report to investors last month was the first time that June-through-September growth in unit sales exceeded growth in sales dollars since September 2009, in the depths of the Great Recession.

So it’s a safe guess that the $99 military passes are bolstering sales without delivering the revenue that $949 passes do.

Pass sales give clues about the industry

Yes, all this seems like inside baseball.

But here’s why it matters: This season’s Epic and Ikon pass sales will deliver critical insights into the future growth and vibrancy of the ski resort industry, which is a critical economic engine in Colorado.

Vail Resorts and Alterra are abandoning the once-prevalent model of developing real estate to fund ski area investment and are now relying largely on pass sales to support a geographically diverse and ever-expanding network of ski areas.

In the last six years, Vail Resorts has invested $115 million into Vail, Beaver Creek, Breckenridge and Keystone, thanks largely to revenue from Epic Pass sales.

Skier Bobby Meller makes his way down a trail at Keystone Resort. (Jesse Paul, The Colorado Sun)

The success of the fledgling Alterra hinges on the company’s ability to create more buyers for the Ikon Pass, not just steal Epic Pass customers. If Alterra can sell more than 250,000 Ikon Passes without pinching Vail Resorts’ pass sales — which last season hit 750,000 and have never shown annual declines — the pass model will continue to drive big investment in the ski experience and increased consolidation.

If Epic Pass sales drop as Ikon Pass sales grow, the industry’s future is not so bright, because the two companies are essentially fighting over a stagnant pool of skiers.

At Tuesday’s panel, Powdr Corp. spokeswoman Jenn Rudolph served as the rose between two thorns.

Utah-based Powdr owns Copper Mountain and Eldora Mountain Resort and has partnered with Alterra on the Ikon Pass. Rudolph noted that visits to ski resorts tend to mirror snowfall more than any other metric. During the recession and through two wars, visits remained strong at Colorado ski areas thanks to bountiful snow years. But a bad snow year, like 2011-12, triggers big dips in resort traffic.

“In the ski industry here in Colorado, snow trumps everything,” she said. “It trumps war. It trumps economy. It trumps gas prices. When it snows, people will find a way to ski in Colorado.”


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