By Katherine Hamilton
Shares of Vail Resorts fell as a nearly weeklong strike disrupted operations at its Park City, Utah, site at the height of the ski season.
The hospitality company's stock declined 5% to $177.5, marking a roughly 16% decline over the past 12 months.
The union, called Park City Professional Ski Patrol Association, announced the strike on Dec. 27 after negotiations over wages and benefits hit a wall.
Roughly 200 employees are involved in the strike, according to the union and Vail Resorts. There are usually about 100 employees working each day, said Margaux Klingensmith, a business manager for the union. The company said it had brought ski patrollers from other resorts to fill in, but declined to share how many employees were working on Thursday.
The resort is facing operational challenges because of the strike, said Bill Rock, president of Vail Resorts mountain division. On Thursday, 24 out of 41 lifts were open and 75 of the 348 trails, Rock said.
The union is asking the company to raise starting wages to $23 from $21 per hour, and to increase the pay scale so longer serving employees earn more, Klingensmith said. Negotiations continued on Thursday.
Vail and the union last reached a contract agreement in 2022. Over the past four seasons, the average wage for seasonal ski patrollers has risen about 50%, Rock said.
Labor costs are an increasing burden on hospitality companies' bottom lines, said David Katz, an analyst at Jefferies. Inflation, particularly for real estate around resorts and other touristy areas, is driving up the cost of living and demand for higher wages.
Vail's labor expenses grew 5.8% in the three-months ended October 2024, compared with the same period the previous year, the company said.
"The ability for people who work at resorts to find a place to live and make ends meet has been challenging," Katz said. "It is eating into profit margins across a lot of our coverage."
Write to Katherine Hamilton at katherine.hamilton@wsj.com
(MORE TO FOLLOW) Dow Jones Newswires
January 02, 2025 14:52 ET (19:52 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
Comments