Why are so few ski resorts open in May?
There is no such thing as Miracle May for the bottom line, even at Mammoth.
Memorial Day Weekend is here — the unofficial start of summer. Flowers are blooming, birds are chirping, and for 99% of American skiers, the ski season is over. Sure there is still spring corn to be found at places like Palisades, Snowbird, Mammoth, Mt. Hood, Whistler, Killington back east, Breck, A-basin, and this year even the Arizona Snowbowl. While many of my friends are still counting their days and have pushed past 50+ or even 100+ days for the season, the vast majority of our wives, siblings, parents, children, and neighbors are not. Warm weather has arrived, and pushed skiing out of mind for the next 6 months.
Why is it that only these few resorts are able to push the season so late? Do they just get more snow? Do they have great snow making or snow preservation systems? Nope.
Are these simply the best ski areas that are blessed with the best snow by mother nature? Not quite.
If you happen to find yourself this weekend at any the other top tier one ski areas like Vail, Beaver Creek, Aspen, Steamboat, Park City, Alta, Kirkwood, Heavenly, or even Jackson Hole, you’ll notice something peculiar: all of those mountains ALSO still have plenty of snow to go around. Or maybe not plenty, but MUCH MORE than pretty much any of them had in early December this year. So why have they all mostly been closed since mid-April?
The Cold, Hard Truth: there’s No Money to be made from skiing in May
The answer is simple: it is almost impossible to generate any meaningful profit as a ski area in May. If you happen to be skiing this weekend, look around at your fellow skiers and riders in the lift lines. Strike up conversation, and see how many non season passholders you find. My guess? Zero. Lots of locals for sure, but also plenty of weekend warriors and van-lifers who have finished their seasonal work somewhere else and finally have time to put that Epic or Ikon pass to good use. And while Reddit whole-heartedly applauds the humble brag hero who managed to ski 125 days on their $1,000 pass for an impressive $8 cost per day skied, the reality is that the ski area sees things a bit differently. That customer spent $1,000 in the fall, and by this time of year they are simply a drain on the coffers.
Ski Area Economics 101
To understand the May struggle, let’s dive into the basics of a ski area’s economics. Like any business, the goal is to generate more revenues that your expenses and turn a profit. In skiing, there’s five basic stages to the season.
1. **Sell AS MANY Season Passes as Possible before Dec 1st**
Resorts aim to sell as many season passes as possible in the fall (and previous spring). Upfront, non-refundable revenue provides secure cash flow no matter how good or bad the weather turns out to be. Resorts use every marketing trick in the book to get you to buy the pass, from the monthly “price bump” deadlines and the strict cutoff after early December to exorbitantly high day tickets so that you regret not buying a pass so much you just have to for next season.
2. **Hire and Train an Army of Hourly Workers before the Holidays**
Come November, it’s all hands on deck. Resorts hire and train a bunch of minimum wage young adults (including lots of J1 foreign student visitors), hoping for a good mix of natural snowfall and snowmaking to get the mountain ready to roll by Christmas. This is crucial because roughly 25% of seasonal revenue often comes between Christmas and New Year’s when the slopes will be packed. It’s a quick zero to 60mph, and oft-referred to as “holiday hell,” but it certainly makes for a lucrative business. A dirty secret is that snow conditions don’t really matter all that much, just so long as there’s enough snow to be open.
3. **Sell $14 beers and $25 burgers to the Captive Audience**
Once peak season arrives, any good deals have long since Irish goodbye’d and disappeared. During peak times, resorts charge insane amounts for full price lift tickets (think $279 for a single lift ticket), lessons, rentals, and everything else that visitors need to make for an enjoyable day on the slopes. No matter how many rodeos it’s been, planning a ski trip is always effort. And once mom, dad, and the two kids get through 4 hours of Friday night traffic, settled into the Airbnb, up early and dressed in ski gear on a Saturday morning by 10am, there’s no turning back just because the rental shop wants an additional $80 for basic rental skis. Likewise when dad gets to the apres bar and realizes his two hazy IPAs will set him back $30, it’s too late to worry about saving money.
4. **Embrace the weekend and holiday peaks in January & February**
After the ~3 weeks of Christmas and New Years, things calm down… for about a week. Then it’s Martin Luther King Jr. and another 3-day weekend. By this time word is out that snow conditions are in prime shape, and then every weekend in January and February is also a zoo. Midweek days are pretty quiet, but only until the President’s Day holiday, when most schools decide to give kids and teachers another full week off school and once again, ski areas are slammed with 11 straight days of chaos and crowds. And that again brings the captive audience willing to swipe that credit card over and over again. By March the snowpack is almost always reliable, even in a below-average winter. But then soon after, spring arrives.
5. **Cut Staff Hours once Demand Drops**
For most people, the ski season effectively ends with the daylight savings time change. After mid-March, the influx of big-spending tourists dwindles down, leaving the die-hard locals and season passholders. And reality is that locals and those pushing for their 100+ day season are far more likely to stuff a 6-pack of Coors in their jacket than fork over $14 for a craft brew on draft. They also don’t take lessons.
Through these five stages, there’s one core thing that stays constant. It takes a ton of money and effort each and every day to get the ski area open for business.
Ski Area costs are fixed, while revenues are variable.
Unfortunately, the cost of running a resort doesn’t drop as fast as the temperatures rise. Lifts still need operators, grooming machines still need to be fueled, and ski patrol still has to keep the slopes safe, perhaps even more so as conditions deteriorate. While food and beverage and the ski school departments can cut back on staff hours, the core costs remain. In the peak of winter, when the slopes are bustling, a ski area’s significant fixed costs are easily offset by significant revenues from not just lift tickets but the collective ancillary spending on lessons, rentals, retail, food and beverage. But come May, despite similar operational costs, daily revenue can drop by as much as 80%. In the hypothetical but realistic daily P&L comparison below, the key factor is how many of a ski area’s visitors are passholders vs. day visitors. The higher the percentage of passholders, the less possible it is to turn a profit in the spring.
Is there a Solution?
So what can resorts do to survive spring without lighting piles of cash on fire? Unfortunately, not much. The daily economics and behavior patterns of passholders vs. day visitors are unlikely to change. However, it is also not necessary to look at daily economics and demand that a business be profitable every day. Ski areas willing to play the long game know that the loyalty of season passholders is earned day-in and day-out, and being the first to open and last to close will always matter to locals and die-hard skiers and riders. Those hardcore skiers and riders are also often the most likely to bring friends and family along next season. When your home mountain has been closed for a month and your buddy at A-basin scores you a free or discounted buddy ticket, that end-of-season adventure on the East Wall might just convince you to buy a pass there next season. After all, today’s May skier is tomorrow’s season passholder.
However, even with a long-term time horizon, with so many top tier mountains on the Epic or Ikon passes these days, the incremental value to the parent company of extending the season at each of their mountains actually goes down. In the 2010s, a place like Mammoth could sell thousands of cheap $75 tickets to Tahoe locals craving late season skiing, and whether or not they bought passes for the next winter, it meant the business could at least break-even on a daily basis throughout the late season. But in 2024, all such Tahoe visitors trekking down to Mammoth already have an Ikon pass, and are unlikely to switch to Epic just because Mammoth has decided it will close at after Memorial Day on May 27th.