How Leaning Into Its Status as an Anti-Resort Made A-Basin More Profitable

The snow crunches under Alan Henceroth’s feet as he clicks out of his bindings and starts to hike across a wind-swept slope at Arapahoe Basin Ski Area. It’s 2 p.m. on a Friday in early November, and Henceroth, the chief operating officer of A-Basin, wants to check on the progress of the new Lenawee Express, a high-speed, detachable, six-person chairlift that is set to replace a fixed-grip triple. The $7 million upgrade will dramatically increase uphill capacity and cement A-Basin’s lift fleet as one of the most modern in North America—no small distinction for the 76-year-old anti-resort, whose A-frame lodge walls are dotted with black-and-white photos. “I think we’re really setting ourselves up for the long run with this thing,” Henceroth says, gazing through the lift terminal at the towering East Wall.

Henceroth, who turns 62 this month, has short white hair, a tan, clean-shaven face, and deep blue eyes. He is a die-hard skier who started working as a ski patroller at A-Basin 34 years ago. His stoic demeanor comes from his father, a B-17 pilot in World War II who was shot down near Berlin and spent eight months in a German prisoner-of-war camp. Henceroth grew up in Tucson, Arizona, and didn’t learn to ski until he was in middle school—and then only by taking Greyhound buses to Flagstaff on weekends.

In 1983, he moved to Colorado and started patrolling at Keystone, a gig that led to his career at nearby A-Basin. For four years, he lived with his wife and two young children in an apartment above the ticket windows. Since 2005 he’s been the ski area’s COO and face—guests often ask to take pictures with him—and he still skis A-Basin on his days off.

Replacing Lenawee is the latest upgrade in an almost two-decade run of improvements that have more than doubled A-Basin’s skiable area and that have cost tens of millions of dollars. Due to abundant summer rain and supply chain issues, the lift opening is running a couple of weeks behind schedule, and Henceroth has been putting off announcing the delay to the public on his popular daily blog. “I should probably break the news,” he says.

It’s been a busy day for Henceroth. He got to work at 6:45 a.m., skinned up to Black Mountain Lodge for breakfast alongside 120 paying guests, checked on a trail he hopes to open the following day, visited the snowmaking pump house, made a quick stop at his office to answer emails and clean up, and then rushed to a luncheon in Silverthorne with the new Colorado president of Xcel Energy, a key partner in A-Basin’s quest for carbon neutrality by 2025. After lunch, Henceroth ducked inside to change back into his ski gear, then hopped on the only open lift, Black Mountain Express, to join me for an interview. At 4:30 p.m., he will ski down to his office in fading light, the last person on the hill.

“If this were 10 or 15 years ago, I probably would be freaked out,” he says of Lenawee’s delay. “I don’t get stressed that easily anymore. It’s more disappointed. I know people want it.”

Indeed, they do. A-Basin, a midsize, no-frills ski area on the Continental Divide, just had a record year, with February and March 2022 being the two most profitable months in its history. In many ways that was consistent with the ski business at large: Both the United States and Colorado set records for skier visits, and Vail Resorts reported its highest quarterly profit ever. But A-Basin’s success represented something else, too. Three years after it stunned the industry by leaving Vail’s vaunted Epic Pass—which delivered more than half of its customers—A-Basin recorded 40 percent fewer guests last season, yet profits were up 20 percent.

At a time when ski resorts everywhere are struggling to manage capacity, when lift line videos are more likely to go viral than triple corks or face shots, A-Basin’s strategy serves as a contrarian model. An hour’s drive from millions of skiers along Colorado’s Front Range, in arguably the most competitive ski market in the world, A-Basin caps how many season passes it sells and cuts off lift ticket sales to avoid overcrowding. And, oh, yeah, it only recently got cell service.

Four years have passed since the Epic breakup was announced in February 2019. After failing to come to terms on a new contract, A-Basin, a mainstay on Vail Resorts’ season pass for 22 years, decided to leave—and in doing so, potentially concede hundreds of thousands of skier visits each year. “Obviously, they’re the biggest and most successful resort company in the world,” Henceroth says. “A lot of people thought we were crazy for doing what we did. But we were going in opposite directions.”

To those who were paying attention, the defection wasn’t a huge surprise. A-Basin, aka The Legend, had been swarmed in recent seasons, largely due to the growth of the Epic Pass, which gave holders unlimited access to A-Basin. (No partner resort on the Epic Pass offers unlimited access now.) Its parking lots were full by 7 a.m. on weekends, turning the ability to ski there into a race. Irate guests were sent to park five miles west at Keystone, then shuttled back up U.S. 6—or, worse, turned away entirely after sitting in traffic for hours. “It just grew and grew and grew,” says vice president of operations Peggy Hiller, who’s worked at A-Basin for more than 25 years. “Our employees were barely hanging on with their fingernails every crazy day. There was no way to turn the spigot off.”

The ski area increased its staff to 550, trying to keep up with visitation. It added 468 acres of terrain with the ballyhooed Beavers/Steep Gullies expansion in 2018. But one could argue opening up more of the mountain only compounded the problem by attracting even more people. “I equate it to this: Say you’re a rock star coming out with a bunch of great records, and you’ve got a raging drug habit,” Henceroth says. “Yeah, things are good today, but eventually what you’re doing is going to destroy you.”

Arapahoe Basin had been founded in simpler times, in 1946, by 10th Mountain Division veteran Larry Jump and four others who’d been hired by the Denver Chamber of Commerce to explore potential ski area sites. Early on, no one cared that the lifts were slow and the lines were long—that was just the pace of the period.

By the early ’90s, Ralston Purina owned both A-Basin and Keystone, and it bought Breckenridge in 1993. Four years later, the company merged with Vail Resorts­—formerly known as Vail Associates—which owned Vail and Beaver Creek. The consolidation, however, attracted scrutiny from the U.S. Department of Justice, which decided Vail Resorts would have to spin off one of its five resorts lest it control too much of the market.

Vail chose to sell A-Basin, a fateful decision for both brands. After an eight-month search for buyers, a Canadian real estate company named Dundee Realty USA—now Dream Unlimited—purchased it. A-Basin’s scrappy employees celebrated and gave away lift tickets on opening day. For so long they’d felt neglected; the ski area had no marketing or human resources departments of its own. Finally, they were autonomous.

Sort of. As a way of boosting A-Basin’s profile, the Department of Justice mandated Vail Resorts include A-Basin on its season pass for five years. That started with a four-person buddy pass to Breckenridge, Keystone, and A-Basin for $750 (roughly $1,500 today). The next year, the company sold individual passes to the same three areas for $199. A-Basin’s inclusion on Vail’s season passes was a lifeline. “We would not have made it without that, I don’t think,” Hiller says.

Each time the contract came up for renewal, A-Basin re-signed. Skier visits increased. Henceroth, who’d gone from ski patrol director to head of mountain operations, oversaw multiple expansions in terrain and chairlifts. Montezuma Bowl’s 400 acres opened in 2008, increasing visits by 30 percent. The Epic Pass debuted that same year for $579, offering unlimited skiing at Vail, Beaver Creek, Keystone, Breckenridge, Heavenly (along Lake Tahoe), and, of course, A-Basin. (Up to then, most season passes were sold locally and priced such that it only made sense to buy if you were going to ski a lot—not the 10 days pass holders average now.) The 2018 Beavers expansion brought A-Basin’s size to 1,428 acres.

But when the contract with Vail came up again in 2019, the conversation had changed. No longer was the guaranteed revenue enough to justify the headaches that came with the partnership—which is why Henceroth and a small group of ski area leaders decided their only path forward was to end it.

Six months after proclaiming it was no longer Epic, A-Basin announced it was joining the upstart Ikon Pass, which includes such resorts as Aspen Snowmass, Steamboat, Copper, Winter Park, Alta, and Jackson Hole. (Ikon’s privately held parent company, Alterra Mountain Company, owns 15 of the 50 resorts on its pass, compared with Vail Resorts owning 41 of the 84 resorts on the Epic Pass.) Ikon holders get up to seven days at A-Basin, and the ski area is paid triple per guest what it used to receive for each Epic Pass visitor, which Henceroth would only say was “more than $10.” The higher margins, along with the steady stream of Ikon visitors (nearly half of A-Basin’s 375,000 visits last season came from Ikon), have shifted the equation.

A-Basin doesn’t require Ikon pass holders to make reservations, like Jackson Hole and Taos do to manage crowding, but A-Basin’s cap on season passes could be considered a more aggressive means of controlling capacity. This year, A-Basin further lowered that cap by 10 percent—a move intended to “make sure people were listening in a noisy market,” says marketing director Jesse True, who’s held leadership positions with Vail Resorts and Intrawest. “We’re serious about this. We’re taking a left when everyone else is going right.”

Not everyone, mind you. While A-Basin was reveling in its windfall, Loveland Ski Area COO Rob Goodell sat on the other side of the Continental Divide, watching the masses flock seven miles south. “We were jealous,” he says. Like A-Basin, Loveland can handle more people on its slopes than in its parking lots, part of the reason why it has never joined one of the big passes, despite being asked, says Goodell, who declined to name which pass. “We are 40 minutes from the metro area,” he says. “We cringe to think, if we participated, what would happen on those days when we have a 14-inch storm and maybe the other side of the divide didn’t get it. That’s not the experience we want to offer.”

Goodell, who’s worked at Loveland for 30 of the 50 years it has been owned by Colorado’s Upham family, concedes it’s “risky” to be truly independent—and there is only so much one’s commitment can withstand. This year, both Loveland and A-Basin increased their minimum hourly wage to $20 to match Vail Resorts’ starting wage. Loveland had been at $15 just two years ago.

Although the U.S. ski industry’s 60.7 million visitors last year constituted a record, the number was less than one percent higher than the previous record of 60.5 million, set more than a decade earlier. (Colorado, home to 32 of the country’s 473 ski areas, notched 14 million visits, by far the most of any state.) The paltry growth over time, placed in the context of the public relations nightmare that last year’s overcrowding brought to the sport, was a topic of conversation at the annual National Ski Areas Association (NSAA) convention in Nashville, Tennessee, last May. Vail Resorts executive chairperson of the board Rob Katz, in an acceptance speech while receiving NSAA’s Industry Impact Award, railed against an “anti-growth narrative” and “growth NIMBYism,” or people opposing new participants because they want to keep the mountain to themselves: “We can’t be an industry that thinks that if you grow barely one percent over 15 years, we’re growing too fast, right?”

This was a year after Vail Resorts discounted Epic Passes by 20 percent and sold 2.1 million in some form, an increase of 47 percent over the previous season and quadruple the total from five years earlier. In February, March, and April 2022, Vail brought in $372.6 million, a record for the quarter. This past December, Vail Resorts announced it had increased its Epic Pass sales to 2.3 million. An Ikon Pass now costs $320 more than an Epic Pass ($1,179 compared to $859).

How each resort tackles capacity is still shaking out. Sun Valley, in Idaho, and Snowbasin, in Utah, left the Epic Pass last March, three years after joining. Then, like A-Basin, they signed on with Ikon. This year for the first time, Alta, also in Utah, is charging guests to park. Jackson Hole, which president Mary Kate Buckley says has been trying to decrease visits since 2018, sold out of lift tickets on 41 of 137 days last winter. Henceroth recently finished a two-year term as chair of NSAA’s board. “Every one of my peers who I talk to, the biggest thing they’re working on is how to deal with capacity,” he says. The question for resorts remains: How does the industry press forward without excluding new or nontraditional participants?

The quest to hit A-Basin’s visitation sweet spot starts with a weekly meeting. Every Tuesday, a small group of managers convenes to determine that week’s lift ticket strategy (A-Basin uses dynamic pricing that ramps up as the weekend nears), estimating how many season pass holders and Ikon visitors will show up, then adjusting from there. Day tickets are ultimately the lever the team pulls to control each day’s crowds. The goal is to hit 4,140 visitors each day—A-Basin’s Comfortable Carrying Capacity, or CCC—but not exceed it.

Roughly a quarter of the ski area’s guests have season passes, while another quarter buy lift tickets ranging in price from $59 to $189. They are far from inexpensive on the high end of that scale, but as Henceroth says, “We want people to come because they like it here, not just because it’s the cheapest pass around.”

The self-sustaining culture—such as when an employee made stickers to push back on newer visitors calling A-Basin “A-Bay” for short (“A BAY is a body of water surrounded by land on 3 sides”)—is part of why Henceroth feels so protective of the brand. He snakes the office toilet when it’s clogged, has been known to ride the free bus to work, and greets frontline employees by name. It’s hard to call the past four years formative, given the ski area’s lineage, but A-Basin has changed the narrative, if not the industry.

“The Vail partnership was our adolescence,” says Louis Skowyra, A-Basin’s director of lifts and slopes maintenance and one of Henceroth’s confidants. “It did us a lot of good, put us on the map, got us the volume to make all of these improvements. But at some point, you’ve got to spread your wings and fly.”

A-Basin’s corporate parent has made that possible. Toronto-based Dream, a publicly traded company with $17 billion in assets (almost triple Vail Resorts’ $6.28 billion), owns real estate all over the world, from boutique hotels to housing developments to industrial parks. But Dream only owns one ski area, and for years it’s put most of A-Basin’s profit back into infrastructure.

“I swear,” Skowyra says, “everything around here is new and different—the lifts, the buildings, the restaurants, snowmaking, parking lots. But I often bump into people who say they haven’t skied here since the ’70s, and it still feels familiar to them.”

The secret is not quite as simple as remaining true to oneself, but it’s not far off. “We’re trying to be intentionally different,” Henceroth says, “because we are.”