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Park City Mountain Resort will furlough nearly 400 employees after the coronavirus outbreak has forced an early end to the ski season and left the company hemorrhaging millions of dollars.
The announcement came in a letter to staff Wednesday from Rob Katz, CEO of Vail Resorts, which owns the Park City slopes and several others across the country. And it affects a community in Summit County that is already battling the worst rates of the virus per capita in Utah.
“I recognize this is very disappointing news to be receiving, and I had hoped we would not have to take this action,” Katz said. “But with each passing week, the financial consequences have become more apparent.”
The furlough is expected to last one to two months. Spokeswoman Margo Van Ness confirmed that it will affect 391 hourly employees at Park City, as well as hundreds more at Vail’s other North American resorts. Those staffers will not receive pay but will retain full health care coverage from the company.
Additionally, all salary employees that remain will see pay reductions from 5% at the bottom to 25% for the most senior executives. Katz said that he is “giving up” his own salary for the next six months.
Katz wrote that the cuts will help “ensure that we can navigate the financial challenges ahead.” With the early closure of the season two weeks ago in response to the virus, the company has lost about $200 million across all of Vail Resorts.
He fears that without being able to open for the summer season, too — which accounts for 20% of profits and runs from May to October — that number will drastically escalate.
“We will work hard to reopen as soon as practical, but much of this is now outside of our control,” Katz said in his letter.
To further offset costs, the CEO wrote that there will be no cash compensation for the company’s board of directors. Company matching for 401(k)s will end. And Vail will defer all plans for construction, including new chair lifts and terrain expansions.
Park City Mountain Resort is a popular tourist attraction in Summit County, which has been hit hard by the coronavirus. As of Wednesday, the county had 204 positive cases, including 9 visitors. With roughly 42,000 residents, that’s one for every 205 people. The health director there said the rate compares to the worst in the country in New York and the worst in the world in Italy.
“And we are the most heavily hit in the state of Utah,” Rich Bullough said early last week.
The county has since issued a stay-at-home order for residents and asked all visitors to leave in order to control the spread. Like most other places in the country, most businesses have shut down.
Ski towns have been particularly affected by the virus. And the 7,300 acres and 17 peaks at Park City Mountain Resort are no exception.
Katz said he will end the furlough “as soon as possible once we have clarity on our business.” And he hopes the resort will be able to open up again at least by next winter.