Stormy weather for ski makers

Wed Feb 25, 2009 9:36am EST
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By Astrid Wendlandt

VAL D'ISERE, France (Reuters) - Snow conditions are ideal from the Alps to the Rockies, the off-piste is heavenly and the groomed slopes rock-free. Yet most of Europe's leading ski companies will lose money again this season.

Rossignol, Dynastar, Fischer and Atomic and Salomon have all cut jobs and moved production to cheaper sites in Asia or Eastern Europe over the past few quarters to stem losses.

Despite their efforts, their businesses remain vulnerable and melting glaciers and declining consumer confidence are only part of the problem.

Growth in rentals is eating into ski makers' sales and giving more power to ski-hire shops that can squeeze small wholesale prices out of their suppliers.

"The rental market is killing ski makers and the trend is showing no sign of abating," said Eric Vaesa, head of the Ski Republic rental shop in the Alpine French resort of Val d'Isere.

"If it is minus 15 degrees (Celsius), a customer will ask for skis that cut the ice, if there is powder snow the next day he will want to change his skis for a wider pair."

There are an estimated 50 million skiers in the world -- not all regulars -- and the number of pairs of skis sold annually has more than halved in the past 15 years to 3.5 million.

Leisure habits have changed. Skiers today make shorter trips than a decade ago, usually for a long weekend or a week, and rent to avoid having to transport their gear. They can also save money by renting if they do not travel to the mountains frequently.   Continued...

<p>People ride a ski lift at Taos Ski Valley, New Mexico, in this December 2007 file photo. REUTERS/Christa Cameron/Files</p>