Last week on my way home from the Rocky Mountain Lift Association conference, I stopped by Skytrac headquarters to sit down with Carl Skylling, General Manager of the company that’s shaken up the lift-building industry in North America over the past eight years. If you hadn’t heard, Leitner-Poma bought Skytrac two weeks ago in a move that surprised many. Carl is an industry veteran who worked his way up through Garaventa CTEC, Doppelmayr CTEC and Skytrac in construction, operations and management positions. In addition to kindly agreeing to be interviewed, Carl introduced me to some of the hard-working men and women who design and build Skytrac lifts in Salt Lake City.
Peter: How did you get started with SkyTrac?
Carl: I started out with Garaventa CTEC and then got pulled into the merger with Garaventa and Doppelmayr, becoming Doppelmayr CTEC. Jan Leonard had stepped down in 2008 and by 2010 I was Vice President of Operations but getting restless to do something different.
I approached these guys with a concept I had to continue this whole idea of doing service work and modification work because I saw that there was a big niche in the market that was missing there. So I approached Dave Metivier and Alan Hepner, and about the same time Jan Leonard was also getting interested in finding a way to take care of his former customer base by supporting them with service and parts. So there was this huge potential market to make all those parts.
One thing kind of led to another between [Jan] and I approaching our partners, Dave and Alan, who were running Hilltrac and Skytrac at the time. We ended up taking this Skytrac concept to the point where, with the four of us, we realized why stop with parts? Why not do a design of our own. SkyTrac started in 2008 doing some engineering/modification work with Dave and Alan but we really, in 2010, took it to the next level.
Peter: What would you say are Skytrac’s biggest accomplishments so far?
Carl: I’d say the biggest is the impact we’ve had on fixed-grip ski lifts in North America in a very short amount of time. In six years, we came out with our product and really impacted resorts in a very positive way and the options they had available to them. The small- and medium-sized resorts now had reasonable option to be able to do something about their old lifts. Up until 2010, they weren’t doing much because they just couldn’t afford it.
Peter: I’ve noticed a lot of your customers are repeat customers already.
Carl: A lot of them are. We’ve done a bunch of work for Pine Knob in Michigan for example. Boy I think we’ve done 4 or 5 projects for them over the years. Crystal Mountain, Michigan we’ve also done a lot of work for, Powder Mountain in UT is doing another project, and we did two projects for our first customer, using our new design, the Monarch terminal at Monarch Mountain in CO.
Peter: I’m sure it crossed your mind but was there ever a strategy for SkyTrac to get into the detachable lift market?
Carl: Yes, there was. We started thinking at some point we are going to need to offer a detach product. We’re building back a customer base that eventually is going to ask us “hey, can we get a detach from you guys?” So we almost immediately started exploring some opportunities to develop a detach. The first effort we made was looking at other company’s worldwide who already had developed a grip. The problem was aligning those designs with our needs, they didn’t have a grip specifically for a quad, so at this point we really decided to develop a grip concept in-house, which we did. It was then that discussions with Leitner-Poma started.
Peter: How did the Leitner-Poma acquisition come about?
Carl: To [Leitner-Poma’s] credit, they watched what we had been doing and the fact that we built up our market share on fixed-grips as quickly as we did. They really took notice to that. It’s been a goal of theirs to develop a fixed-grip lift to better serve this market. Their [Alpha] design is a great, beautiful design but it’s a big design. It never really fit the 80 percent of fixed-grips going in. On their end I think they were getting tied up with so many of the big projects they were doing – the urban transportation, the Ferris wheels, the big gondolas and detach systems.
It’s very hard to carve out a group in your company and say “you are going to focus on this for now” when there’s other work to be done. So they had the same problem with the fixed-grips that we had with the detaches. We couldn’t carve out enough of our resources to move that direction. So [Leitner-Poma] sort of noticed what we did and said why don’t we talk to them? It certainly matched our goals strategically and from the beginning we really didn’t see any negatives. After that it moved forward rather quickly.
Leitner-Poma was also looking to develop a stronger presence in the Utah market. We can now offer the strong presence, support, and service right out of Salt Lake City.
Peter: I put together a graphic for when I post this interview showing fixed-grip lifts from Doppelmayr, Skytrac and Leitner-Poma over the last ten years and it really shows how much more it affected Doppelmayr when you guys came along.
Carl: Yeah, absolutely. We didn’t really see Leitner-Poma as our competition. Occasionally we may have bid bigger fixed-grips as competitors but generally speaking, no.
Peter: What are some advantages of being part of a larger group of companies?
Carl: Being a small company, especially in this industry, it’s very cyclical. There is a time we’re selling lifts, a time where we’re manufacturing them and a time we’re installing them. The cash flow cycle follows that, unfortunately, pretty closely. So there’s a time of the year where you don’t really have any cash coming in. Being a smaller company, it’s very hard to absorb that and keep your operation moving through that period. Even though you’ve been successful the year before and you’re going into another successful year, you still have that time of year where’ you’ve got to solve that cash flow problem. Joining a bigger company that has more depth certainly helps that. It also allows us to be more efficient because during that time of year we can be manufacturing; forecast producing pieces and parts and sitting on them allowing us to use our capacity in a smarter way throughout the year.
Peter: You lived through Doppelmayr’s merger with Garaventa. How is this different?
Carl: I see this as 100 percent different. The goals in North America just did not align as well as ours do with Leitner-Poma. We just have a lot of synergies.
Peter: So you anticipate staying here in Salt Lake with your employees and product?
Carl: 100 percent. They, Leitner-Poma, really want us to take responsibility for the fixed-grip market and continue doing what we are doing with the strategy and mission that we have. And that’s really what made their offer to buy us appealing. There was really no negative. So that’s the intent. We now have a lot of synergies with [Leitner-Poma]. We respect and appreciate what they do, they respect and appreciate what we do and how we do it. They have incredible technology and skills throughout the world and we now can tap into that. They can tap into some of the potential that we have.
Peter: I was going to ask- do you have any initial thoughts about what components of theirs you might incorporate or vice versa?
Carl: The plan is to use all of our own components. We’re sticking with the SkyTrac components/designs. I see no real value in changing that. From both sides, there will be no change.
Now, it does open up certain possibilities. If a resort already has a bunch of Poma sheaves, we could supply them Poma sheaves so that they have consistency of parts. Absolutely we are open to being able to serve a customer’s needs like that. But as far as selling our standard product, it’s going to be 100 percent Skytrac. If synergies will save the customer money, we will use them.
Peter: What’s your outlook on the future of Skytrac and the fixed-grip lift market generally?
Carl: I think fixed-grips are really a bright spot, perhaps the only bright spot in the lift market. As a whole, if you look at the number of lifts that were installed, the ‘70s was the boom. Through the ’80s, ’90s and into the 2000s, it’s a negatively trending market. This market for new lifts has shrunk quite substantially with half as many lifts going in as twenty years ago. So considering that, the retrofitting of the old lifts that are out there is where the future growth potential is. We are perfectly positioned to accommodate that. And now, being able to expose our product to the Leitner-Poma customer base has the potential to expand our market quite a bit. I can really see Skytrac growing in that sense.
What would you say to the folks who reacted negatively on Lift Blog, SAM, etc. saying the purchase is anti-competitive?
I don’t see how helping Skytrac grow its market share hurts competition? As I mentioned earlier, we are focusing on the same mission and strategy that has already had a big impact on the lift market. This will allow us to be more efficient and do more.
Peter: What are some projects you guys are currently working on?
Carl: We’ve got a sky ride down in California at the Sacramento Fairgrounds. We’ve actually got two sky rides we’re supplying to St. Maarten in the Caribbean. So this year a big chunk of our business is focused on sky rides. But we’ve also got lifts going in at Laurel Mountain, PA, and Powder Mountain, UT, and others pending.
Peter: Better than last year.
Carl: I think everyone’s going to be busy this year.
Thank you to Carl and everyone at Skytrac and Leitner-Poma who trusted me to do this important interview!