News Roundup: Working Capital

Following Cancellations, How Will Lift Construction Recover?

When Vail Resorts spelled out its suspension of operations in mid-March, the shutdown was hoped to last only a week.  Fifty days later, all 37 resorts remain shuttered and the company has borrowed more than a billion dollars to weather a possible extended recession.

Almost immediately, Vail Resorts postponed discretionary capital improvement projects including seven new chairlifts.  Vail is just one of numerous operators of lifts facing epic challenges due to COVID-19.  The impacts trickle down to suppliers, particularly global suppliers of large machinery like the Leitner Group and Doppelmayr.  While the two major lift manufacturers are of similar size and structure, their customers are incredibly diverse, from mom and pop outfits to governments, NGOs and Fortune 100 companies.

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As regular readers of this blog know, the lift business is not the same as the ski business.  Leitner-Poma, Skytrac and Doppelmayr USA have all completed projects for non-ski venues recently such as theme parks, zoos, stadiums and cruise ports.  Not only are these projects making up an increasing share of contracts, they tend to be large in scope and often include lucrative operation and maintenance deals.  Some of these non-traditional customers are in even worse shape than the ski business, more dependent on high guest densities and air travel.  Put another way, there is little chance the Walt Disney Company, Carnival Corporation or the Miami Dolphins would have signed to build their recent lift projects in today’s environment.  So-called “point of interest” projects may disappear entirely for a few years.

One bright spot could be urban transport.  The Portland Aerial Tram and Roosevelt Island Tramway have both remained operational throughout the pandemic, albeit at reduced capacity (the Portland Tram carries health care workers to three different hospitals and is about as essential as it gets.)  Large aerial tramways have been ceding market share to monocable, 2S and 3S gondolas, a trend which will probably accelerate with new personal space concerns.  With gondolas, each person or family can take their own cabin unlike on trains or buses.  There are lots of great concepts for urban gondolas in North America and infrastructure spending programs could finally get one or two off the ground.  Mexico already has a large urban gondola system in operation with two more under construction.

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Big Sky and Loon Mountain Postpone Lift Projects to 2021

Boyne Resorts and Doppelmayr have reached an agreement to delay construction of two major lifts due to the Coronavirus emergency.  Both Swift Current 6 at Big Sky Resort and Kancamagus 8 at Loon Mountain will now be constructed in 2021.  “Proceeding with a complex and deadline sensitive construction project during the COVID-19 emergency would not be a prudent decision,” stated Troy Nedved, General Manager at Big Sky Resort.  “Concerns about construction worker health and the unknowns related to the construction supply chain make the project too risky to undertake in 2020,” he continued.

Site preparation and limited construction may proceed this summer if public health conditions permit.  Manufacturing of Swift Current’s components is nearly complete and the lift will be stored either in Wolfurt, Salt Lake or the Bozeman-Big Sky area until next year.  When completed in 2021, Swifty will become the fastest six place chairlift in North America.

At Loon Mountain, skiers and riders will have to wait another year to ride the east’s first eight passenger chairlift, Kancamagus 8.  “Although significant investment has already been made, we cannot proceed with a project of this scale knowing the COVID-19 situation could further complicate its installation – potentially cutting off the Governor Adams Lodge and base area from the rest of the resort next winter,” said Loon General Manager Jay Scambio in a letter to season passholders.  “This postponement allows us to better support our team, our guests, and the greater Loon community at a time when it is needed most.”  Permitting and planning will continue in preparation for 2021 installation.

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I spoke with Boyne Resorts President Stephen Kircher this morning about the decision and his outlook during this challenging time.  The company will closely monitor impacts on summer business as well as season pass sales and proceed accordingly.  “We are going to be assessing our capital projects each week,” said Kircher.  “We’ve got milestones on every single project and last possible start dates to meet deadlines for next winter.  We’re optimistic we are going to be executing a number of projects but we need to see clarity.”

As long duration, all-or-nothing projects, the two D-Line lifts had to wait.  Boyne knew it needed to be underway this week at Loon and within two weeks at Big Sky in order to meet aggressive construction schedules.  Bubble lifts by definition include carrier storage buildings that are as complex to build as the lifts themselves.  “What happens if work stoppages occur again in the middle of summer or the fall?” lamented Kircher.  “Once we tear the existing lifts down, we’re at risk.  We would be dead in the water [without Swift Current or Kancamagus.]  The second worst thing other than this shutdown would be not having a key lift coming out of the base next winter.”

Preliminary work on the Swift Current chair parking facility may occur this summer.

Boyne’s decision is the second such deferral among North American multi-resort operators this week.  On Wednesday, Vail Resorts delayed seven different lift projects with two different manufacturers in order to cut costs.  Kircher acknowledged his decision was difficult for both customer and supplier but in some ways proved clear.  “We are working with a great partner in Doppelmayr.  Obviously they are dealing with a lot of difficult conversations across the planet,” he said.  “We talked through what the best scenario was for both companies.  They don’t want to be in a situation where they can’t finish a lift either.  I want to install a lift that we own and is sitting in warehouses more than anybody but it’s just not prudent.”

News Roundup: Ripple Effect

  • Saddleback demolishes the Rangeley double to make room for its upcoming high speed quad.
  • Debt-laden Ski Granby Ranch lays off all its employees and won’t issue refunds to guests with canceled vacations.
  • The $2.2 trillion phase three stimulus package passed by Congress doesn’t include assistance specifically for ski areas but there is hope phase four might.
  • Vail Resorts borrows more than $500 million from existing lines of credit in order to increase its cash position and maintain financial flexibility during the outbreak.
  • While many Leitner-Poma staffers work from home, a skeleton crew continues production.
  • Even in hard-hit Italy, one major lift customer plans to commence construction as soon as the immediate health danger has passed.
  • Many Doppelmayr employees are also working from home and production continues in Wolfurt.
  • Aspen Snowmass intends to complete all capital projects as planned this summer including the $10.8 million Big Burn chairlift.
  • Vail Resorts CEO Rob Katz personally donates $2.5 million to mountain community charities and an employee assistance fund.
  • Yet another lift project cancelled by Vail Resorts: replacement of Peachtree at Crested Butte this summer.
  • NSAA estimates costs from early closings and lost pass sales will exceed $2 billion in the United States and forecasts capital spending will plunge 50 percent this year.
  • Magic Mountain’s Geoff Hatheway offers a small ski area perspective on COVID-19.
  • Coronavirus may impact the review timeline for Snow King Mountain’s proposed expansion and other projects on Forest Service lands.
  • Katharina Schmitz officially takes the reigns of Doppelmayr USA from Mark Bee, who retired on March 31st.
  • Boyne Resorts estimates $22 million in lost revenue as a result of this winter’s abrupt end.
  • The Vietnamese developer behind both the world’s longest and tallest 3S gondolas plans another island-hopping 3S in the country’s north.

Sugarloaf Outlines West Mountain Expansion & Future Lift Upgrades

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Boyne Resorts will embark on a major investment campaign at Sugarloaf in the coming years called Sugarloaf 2030, similar to plans revealed recently for Big Sky, Loon Mountain and Sunday River.  The central Maine resort will begin work this summer on a 450 acre expansion of West Mountain with a variety of new trails.  The area will eventually feature a big new lift.  As part of the expansion, the current West Mountain double will be shortened to about half its current length.  The expansion includes a modest new base area with expanded parking, tubing and a small lodge.

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“This development will expand Sugarloaf’s beginner and intermediate terrain, and will greatly alleviate traffic congestion at the SuperQuad by shifting significant numbers of riders to this new area,” says the Sugarloaf 2030 website. “Several options are being considered for size and type of lift for this location, with lift construction expected to begin in the summer of 2021.”  The lift will be designed with foot passengers in mind as Bullwinkle’s will see expanded use for weddings and conferences.  West Mountain will also be home to a future lift-served mountain bike park.  “This will be the most significant project at Sugarloaf since the SuperQuad was built in the mid 1990s,” noted Sugarloaf General Manager Karl Strand. “We’re thankful for leadership of Boyne Resorts, which, over the past 13 years, has helped us get Sugarloaf to a position of growth that allows for development projects like this.”

Lifts across the mountain will be replaced over the next decade.  Timberline, a Borvig quad serving the summit will be replaced with another new lift supporting varied year round experiences.  A third near term priority is the Double Runner double-double, which is approaching 50 years of age.  A new quad would better serve ski school programs and increase out-of-base capacity.  Carrabassett Valley Academy also plans to partner with Sugarloaf on a new alpine training surface lift servicing race trails above Double Runner.

Further out, Boyne plans to replace two more aging quads.  A new King Pine would run in a modified alignment with better wind resistance and improved reliability.  A future SuperQuad replacement is more about increasing capacity with state-of-the-art equipment.

Between this new plan, Sunday River’s vision announced two weeks ago and the rebirth of Saddleback, the 2020s are already proving to be an exciting time in Maine.  The Pine Tree State is well positioned to be a great place to ski in a changing climate and companies are responding with big investment plans.

Sunday River Unveils Ten Year Plan for New Lifts & More

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With ambitious improvement plans recently crafted for Big Sky and Loon Mountain, Boyne Resorts has turned to updating its capital spending vision for Sunday River, Maine.  Spanning eight peaks in the beautiful Mahoosuc Mountains, Sunday River offers more than 50 miles of trails and a beast of a snowmaking system.  Though the terrain and scenery are top notch, many lifts were installed during the American Skiing Company boom years and are showing their age.  The plan prescribes replacing at least six lifts and building a lift-served real estate development on a ninth mountain called Merrill Hill over the next ten years.

Lift wise in the short term, the two biggest priorities are Barker Mountain and Jordan Bowl.  The former is no surprise as the Barker Mountain Express was originally built by Lift Engineering and converted to a quasi-Poma high speed quad decades ago.  While no specific model was specified, I expect the replacement will be a six or eight place signature lift.  The Jordan Bowl Express is newer, built by Doppelmayr in 1994, but also ripe for up-gauging given the vast amount of terrain it services.  Another near term project is the Merrill Hill lift, providing access to a new ski-in, ski-out neighborhood near North Peak.  During this phase, the White Cap quad is slated to gain a loading conveyor to increase speed and efficiency.

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After those projects, Sunday River is targeting the White Cap and North Peak lifts for replacement.  The former is a 1987 Yan fixed grip quad with a ride time in excess of 10 minutes.  North Peak is a 1997 Doppelmayr detachable quad.

Near the end of the 2030 plan, the Aurora Peak and South Ridge lifts would be addressed.  Aurora is another Yan fixed grip that moves very slowly.  It’s newer than White Cap, having been installed in 1991 as one of Yan’s last-ever installations.  South Ridge is one year newer and was built by Poma.  Not all of these installations will necessarily be brand new machines.  Boyne plans to shuffle lifts within and between resorts in the coming years, including the outgoing Swift Current from Big Sky and Kancamagus at Loon Mountain.  The company also wants to purchase the bubble six place lift from the Hermitage Club, which would go to one of Boyne’s three northeast mountains.

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The workhorse Barker Mountain Express services six of Sunday River’s most popular trails and is planned to be replaced early in the 2030 vision.

The Sunday River 2030 vision includes more than just lifts.  RFID ticketing technology will be implemented resort-wide.  An observation deck on North Peak and mountain coaster are planned.  At the top of the already spectacular Jordan Bowl pod, a signature summit restaurant is envisioned.

Looking at the history of Sunday River, it’s quite remarkable how many lifts and terrain expansions Les Otten was able to complete before American Skiing Company ran out of cash.  Otten purchased 18 different chairlifts and grew the resort from 40,000 skier visits to more than a half million annually.  Boyne’s plan will build on that success, replacing up to six lifts and adding another peak. “We are incredibly grateful for our guests, our team, and the Boyne Resorts family for helping to guide and determine our future,” noted Sunday River President and General Manager Dana Bullen.  “The next decade will be one of the most transformational in our 60-year history, assuring that Sunday River will remain one of the top resorts in the Northeast.”

Announcing Kancamagus 8, the East’s First Eight Pack

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Boyne Resorts will invest millions to build its third D-Line chairlift, an eight place at Loon Mountain set to open for the 2020-21 season.  The first such lift in the Eastern United States will replace the Kancamagus Express, a 1995 detachable quad servicing the lower mountain.  Like Boyne’s two Doppelmayr D-Line systems at Big Sky, the Kanc will feature tinted bubbles, heated seats, locking safety bars, a loading conveyor and direct drive.  “The Kancamagus 8 chairlift will be a leap into the future of skiing for our guests,” said Jay Scambio, president and general manager of Loon Mountain Resort.  “We are committed to bringing the latest advancements to our guests—this lift is the next example of that, following our first-in-the-world dual-frequency RFID installation.”

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Boyne will operate the only two eight place chairlifts in the Americas.

Loon Mountain currently operates an all-Doppelmayr fleet of ten lifts.  “We have a deep, long-standing relationship with both Loon and Boyne Resorts,” noted Mark Bee, President of Doppelmayr USA.  “We are proud to be a part of a major step forward in the eastern ski scene that puts Loon on a path towards achieving its goal of having one of the most advanced lift systems in the world.”  The east’s most technologically advanced lift will spin at 1,100 feet per minute, making it even faster than Ramcharger.  A ride on one of 62 ultra-wide chairs will take just 4.5 minutes.  Capacity out of the Governor Adams base area will increase 25 percent to 3,500 guests per hour.

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The Kancamagus quad is 24 years old and in need of a capacity upgrade.

No other American or Canadian ski operator has purchased eight place or D-Line lifts to date.  I asked Stephen Kircher, Boyne’s chief executive, what it feels like to be the American early adopter for such technology and this was his response:

It is humbling to be able to continue our company and family’s legacy of over 70 years bringing skiers the next generation of chairlift technology.  Now doing it beyond the midwest, with Doppelmayr’s new D-Line technology and doing it with the first two 8 place chairs is even more gratifying.  Ironically it took the rest of North America time to adopt triple, quad and six place chairlifts after those were introduced at Boyne in the 60’s through early 90’s, it seems eerily similar for 8 place chairlifts and the new D-Line.  Boyne Resorts is proud to be showcasing the future of uphill transportation in the rockies and the east.  We believe this will become the new standard of quality and efficiency in the decades ahead. This is likely only the beginning of many more of these types of lifts across North America.  Ultimately, enhancing the experience and attracting many more people to the mountains.”

– Stephen Kircher, CEO/President, Boyne Resorts

Kanc 8 will be the first major investment of Flight Path: 2030, a ten year infrastructure push at Loon also announced today.  Future projects will seek to elevate the ski experience, grow the business responsibly in every season and connect with the local community.  Lift upgrades over the next ten years may include Seven Brothers, Lincoln Express, North Peak Express and the gondola .  “Loon’s 10-year plan will have a positive impact on development throughout the Lincoln and Woodstock communities—as we travel together on our path to be New England’s premier mountain destination,” said Scambio.

The Forest Service has already approved the Kanc 8 project and construction will commence in early spring.

Big Sky to Build North America’s Fastest Six Seat Chairlift

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Swift Current 6 will join the existing Ramcharger 8 as an out-of-base workhorse in winter 2020-21.

Big Sky Resort will cement its position as America’s leader in lift technology with the debut of Swift Current 6, the resort’s fifth major lift addition in four years.  The announcement comes just 12 months after the launch of Ramcharger 8, the only eight place and first D-Line lift in North America.  By December 2020, two groundbreaking bubble chairlifts will rise from Big Sky’s Mountain Village: one to Andesite Mountain and the other flanking Lone Peak.  Not only will Big Sky operate the only two ski lifts in North America with Doppelmayr D-Line technology, the Boyne Resorts flagship will also feature the most lifts with heated seats (three) and the most bubble lifts (four, not counting the private Yellowstone Club which has 8.)

Swift Current 6 will span twice the distance of Ramcharger – about 8,500 feet across 24 towers – making it the fourth longest bubble lift on the continent.  126 premium upholstered chairs will yield a capacity of 3,000 passengers per hour, an increase of more than 25 percent versus the current detachable quad.  “Consistent lift improvements are an essential part of Big Sky’s 2025 vision,” noted Big Sky President and COO Taylor Middleton. “We know efficiently dispersing skiers across our almost 6,000 acres of skiing is essential to our guests.  Swift Current will dramatically modernize and improve the flow of skiers in the Mountain Village base area.”

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Swift Current provides a critical link between Andesite Mountain and Lone Peak and is utilized in both winter and summer.

Swifty’s 6 m/s line speed will mark a first for North American six place chairlifts and a flight to the heart of the alpine will last just seven minutes.  Many aspects will mimic Ramcharger 8, a pioneer still unmatched in the Americas.  Bubbles will come in Big Sky blue with heated seats underneath.  “This technology offers guests reliability, efficiency, and a staggeringly fast, warm, and comfortable ride up to the iconic Lone Peak—America’s Matterhorn,” said Stephen Kircher, CEO and President of Boyne Resorts.  “There will be no faster, safer or more comfortable chairlift in North America.”

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News Roundup: Glass Floors

News Roundup: Italian American

    • The Edmonton Ski Club and its Mueller T-Bar will reopen this winter following a one year hiatus.
    • The developer of Big Snow America is so confident in the American Dream project that it offered the Mall of America and West Edmonton Mall as collateral to secure a $2.8 billion construction loan.
    • Investors and Berkshire Bank battle over whose claim to the Hermitage six pack should take precedent.
    • The White River National Forest extends public commenting for the Breck Peak 7 Infill chairlift project to September 1st.
    • The Forest Service approved Aspen Mountain’s Pandora expansion awhile ago but the county still needs to approve necessary zoning.
    • SilverStar adds 24 hour security, surveillance cameras and enhanced line checks in the wake of the Sea to Sky Gondola downing.
    • TransLink’s CEO says the proposed Burnaby Mountain tricable gondola would be less susceptible to such an attack.
    • Grouse Mountain gives all Sea to Sky Gondola passholders free lift access through November 30th.
    • S2S cleanup will take awhile and trails remain closed for public safety.
    • Swiss manufacturer Bartholet shows it’s possible to build a new fixed quad in just three weeks.
    • Jaegerndorfer now exports Omega V cabins in miniature form to the United States.
    • Aspen Snowmass will add chairs to lifts at Highlands and Snowmass to address Ikon Pass crowding concerns.
    • Skytrac will manufacture towers for and install the new Leitner T-Bar at Ski Cooper.
    • This profile demonstrates why the Kaiser S2 excavator is so popular for ski lift construction.
    • MND Group, owner of LST Ropeways, says it has resolved “financial difficulties” by reorganizing its debt.
    • Doppelmayr names Jürgen Pichler its new global marketing chief.
    • It looks like Sunday River’s Locke Mountain triple will gain a tower or two thanks to the new T-Bar that crosses under it.
    • Arctaris Impact Fund hosts a community meeting and announces its intention to close on the purchase of Saddleback come early November.
    • Big Sky and Loon Mountain will launch the world’s first dual frequency RFID lift access system in partnership with Axess.
    • With a new detachable quad under construction, Bogus Basin caps a five year turnaround.
    • Alpine Media display screens will go live on more chairs this winter.
    • Big Burn at Snowmass may be replaced with a bubble lift.

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