Why are American ski resorts so expensive?
While doing some research for my answer in are ski areas shutting down? I was a bit shocked by the American prices for lift tickets. Vail is at $220 and while this may be an exceptionally expensive resort, the average price in season 16/17 was at almost a hundred dollars and for sure has not decreased since.
Compared to Europe, this is outrageous. Ski Arlberg, probably the biggest resort in Austria is at 56€ this season with other top resorts in Austria being close to this. Even if we take expensive Switzerland, most resorts are in the 55 to 65 CHF with top resorts like Zermatt International being at 90-100 CHF (they have dynamic pricing). This is basically a factor of 2 and more to American resorts.
Can anybody tell me reasons for this?
(At the time of writing, $1 = 0.98 CHF = 0.93 €, therefore about the same magnitude)
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I've wondered that too. I think the answer is limited supply combined with substantial barriers to opening new resorts. In the US, most mountainous areas in the West are owned by the federal government and administered by the US Forest Service. The permitting process for new resorts on USFS land is ludicrously expensive, slow and complicated (and expansion of existing resorts, though this isn't quite as difficult). You can get into the double digits of millions of dollars before even breaking ground. Then factor in the numerous protests, lawsuits, etc. ANY change in use of federal land goes through and opening a new resort is nearly impossible. Side note: some tracts of private land large enough to develop into a ski resort do exist. However they're rarely offered for sale and needless to say are extremely expensive
Most ski resorts in the West were opened when permitting was much easier. Now you have many more skiers (because of US population growth) and about the same number of large resorts as there were in the 70s (and many less small ones, but that's a different topic). So ski resorts are basically this fossil resource that we can't make any more of as demand increases
Also consolidation in the ski industry (lookin at you, Veil Resorts) probably contributes
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Because enough people pay this price for the resort to stay in business.
Sister site What Creates the Price in the First Place
supply and demand depend on a whole range of (hypothetical) prices. However, the equilibrium price (which is a certain price and different from the range of potential prices) is that price where both supply and demand meet. Source
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