Ski Industry Consolidation and Antitrust Concerns?

[soulskier]

I was wondering what people think about the two big companies (Vail Resorts and Aspen/KSL) controlling such a large share of the total skier market?

In California, the new Aspen/KSL entity will provide close to 50% of the state's total skier visits with its 6 ski resorts (Squaw Valley, Alpine Meadows, June Mountain, Mammoth Mountain, Bear Mountain and Snow Summit).

Here's a good read from Jason Blevins of the Denver Post.

Consolidation, emerging duopoly in ski resort industry might raise antitrust concerns.

Thoughts from the Peanut Gallery?

PS I realize there was some discussion of this on the "Intrawest sells to Aspen and KSL" thread, but felt this topic warrants its on discussion.

 

[crgildart]

Don't hold your breath on the current DOJ stepping up to protect average consumers from abuse by big money interests.

 

[MikeS]

I think the emergence of Aspen/KSL as a direct competitor to VR is going to do the opposite. When VR was the only big actor on the scene, they could have reached a point where their resort portfolio got big enough that they could start acting in monopolistic fashion. Because from what I understand (any corporate lawyers feel free to correct me here), that's the trigger for any antitrust proceedings. Not whether or not a company is the only option, but if they use their dominance to dictate the market as a whole. Now, with Aspen coming up as a direct competitor, it will act as a roadblock on VR pushing its weight around.

Duopolies exist throughout various industries, and do not cause any antitrust issues. Coke and Pepsi is the classic example. Two companies that dominate the market, but counterbalance one another to prevent either from dictating the market.

 

[NonNativeRado]

Duopolies can benefit from some of the same advantages of monopolies. So much of the ski industry is location based, in all reality, most skiers are either locals or tourists who only visit one or two locations annually like they would with amusement parks.

I really don't see a scenario in which day rates at windows come down. I also don't see a situation where this "increased" competition will drive down season passes.

I think best case scenario is that Powdr Corp, Boyne, and a lot of smaller ski hills to push another option out there in some type of partnership.... to get into the multi-resort season pass game.

 

[TonyC]

I think best case scenario is that Powdr Corp, Boyne, and a lot of smaller ski hills to push another option out there in some type of partnership.... to get into the multi-resort season pass game.

They were already doing that with the MaxPass, which also included the Intrawest resorts.

Through 2017 the Mountain Collective resorts were clearly more attractive to the avid skier population in general than Vail's resorts. However in Tahoe and I-70 Colorado Vail's resorts were/are a big enough piece of the local market that many skiers feel they have to buy at least an Epic Local pass.

In 2017 Whistler/Blackcomb and Stowe switched from Mountain Collective to Vail.

By 2019 the former Intrawest resorts (Steamboat, Winter Park, Stratton, Blue Mt., Tremblant, and Snowshoe, the latter 3 areas dominant in their local markets) will switch from MaxPass to whatever Aspen/KSL decide to do.

People are assuming that the Aspen/KSL resorts will go to an EpicPass model, but nothing has actually been announced. You could make a case for them just adding the Intrawest resorts to Mountain Collective. This would overall keep MCP ahead of Vail in quantity and quality of resort offerings.

If Aspen/KSL go to the Vail model, you now have four groups.
1) Vail
2) Aspen/KSL
3) Remainder of Mountain Collective, lost Aspen, Squaw and Mammoth, but still has AltaBird, Jackson, Taos, Telluride, Sun Valley, Banff, etc., not exactly chopped liver. This is why I don't think it's automatic that Aspen/KSL leave MCP.
4) Powdr/Boyne/some others on MaxPass

At any rate with 4 groups above we are still some distance from a monopoly. There's more room for discussion regionally. In California you can argue that combining Squaw with Mammoth weakens Vail's position.