While season pass holders may be wondering if they should purchase now for the winter of 2020-21, two of the largest ski area conglomerates across the U.S. are in the process of either laying off or furloughing employees and contemplating if they even can be open this summer. According to reports in industry trade publications, management at Vail Resorts and Alterra are having to make difficult decisions.
Vail Resorts has furloughed the majority of its year-round hourly employees and plans on pay cuts for salaried employees. Vail also has put capital improvements on hold. Vail closed its North American resorts in mid-March. The financial cost is estimated at between $180 million and $200 million in lost profitability in its third quarter ending in April. According to a post on the saminfo.com web site, reducing capital expenditures by $80 million to $85 million by deferring all new lifts, terrain expansions, and mountain improvements. The company is aiming to protect its maintenance capital spending, though. VR will also eliminate June through September dividends to shareholders. As of April 6, Vail stock is trading at less than $150 per share. It was as high as $255.
Alterra is in a similar predicament and also closed its resorts in mid-March. Another saminfo.com post states that, “operational expenses have been cut across the board, and more than half of the capital expenditure plans the company unveiled earlier this year have been postponed to preserve cash.” The company’s president, Rusty Gregory, said that he will not take a pay check until all year-round staff members return to work. Gregory said he is hopeful that Alterra resorts could still maintain their summer agendas but could not make a commitment one way or the other.