Doppelmayr: Good 2019 - 20 Business Year – Fallout From Pandemic Affects Future

The current situation provides a mixed picture for the international ropeway manufacturer. In the last fiscal year, the Doppelmayr Group posted sales revenues of 872 million euros. Thomas Pichler, executive director of Doppelmayr Holding SE, notes that, after a promising start in January 2020, the impacts of COVID-19 became increasingly noticeable. An industry-wide drop in sales by one-third has also forced Doppelmayr to introduce measures. “Following several months of short-time working, we now have to bring our headcount in line with the change in our order situation,” says Pichler.

80-percent dependent on tourism

In fiscal year 2019/20 (April 1, 2019 to March 31, 2020), the market massively dominated by winter tourism accounted for around 50 percent of sales revenues. This highlights the importance of the ski regions in the Alpine countries Austria, Germany, Switzerland, Italy and France for the Group. The dependence on winter, summer, day-trip and leisure park tourism is in the region of 80 percent.

The winter sports resorts invested in new lifts and large feeder installations in 2019/2020 to boost their offers and the level of comfort for their guests. In Kaprun (AUT), for example, the latest cabin model ATRIA has been in service on the Kitzsteinhorn since December 2019. The ropeway cabin is taking on ever-greater significance as an important experiential space. With ATRIA, an outstanding design was developed while simultaneously offering passengers new possibilities for information and entertainment.

Major stimulus through new projects

Despite the fact that the current business year will be severely impacted by the effects of the coronavirus pandemic and a huge drop in sales revenues is anticipated overall, the Doppelmayr Group has succeeded in securing several major contracts in recent months. “The Covid crisis led to a sharp slump in orders and also in quotations. For that reason, new contracts give us renewed hope and confidence in spite of the gloomy forecasts for the industry as a whole. The investment subsidy has enabled us to win orders above all in Austria. That creates planning security, even if market volume is set to shrink by one-third worldwide. Invitations to bid for installations in Central and South America are also on the agenda,” says Pichler. A shortfall of around 30 percent over the previous year is nonetheless to be expected.

Industry-wide downturn

The situation has been alleviated by the introduction of short-time working for several hundreds of employees in March. 120 contract workers, who were hired for peak production periods, were no longer employed over the summer. The Doppelmayr Group, like the entire ropeway sector, is now feeling the huge impacts of the pandemic. “In spite of some attractive individual projects, our order position has decreased significantly in recent months, and an uncertain winter with little or postponed investments in ropeways lies ahead,” says Thomas Pichler. “We therefore have to assume that our sales revenues are also set to fall by 30 percent. Unfortunately, these huge and unforeseeable decreases have impacts on personnel levels. We are forced to part company with 190 out of 3,400 employees worldwide, 95 of these at the Wolfurt site. We expect our headcount to stabilize at this new level for the next few years.”

Record number of apprentices

The employees affected have already been informed. Meetings with these employees to find socially acceptable, mutually agreed solutions are currently ongoing. Thomas Pichler is fully aware of the difficulties this situation poses for all those concerned. As a ropeway manufacturer with highs and lows in terms of capacity utilization, Doppelmayr has learned how to cope with crises. “During the 2008/09 financial crisis, we also had to cut back on personnel. Since then, however, we have significantly increased our headcount again by 800 worldwide, which includes over 400 in Austria. We are therefore confident that we shall also be able to master this situation, win new orders with great dedication and effort, and be able to create new jobs. Our confidence is reflected in the high number of apprentices this fall. 36 apprentices – out of a total of 124 – began their training in Wolfurt this year and will be acquiring outstanding skillsets that will enable us to continue to jointly build innovative ropeways in the mountains and in cities.”

Future: Winter tourism and urban mobility

With the ropeway, the Doppelmayr Group has a unique product that creates impressive experiences in many areas, whether it’s in the mountains or in leisure parks. Urban ropeways will continue to grow in importance, especially as they offer clear benefits for the shift to sustainable means of transport. Thomas Pichler still sees winter tourism as Doppelmayr’s core business. “People’s need to travel and to enjoy the mountain experience in the summer and especially in the winter remains undiminished. Our customers are fighting for winter tourism and we, as ropeway manufacturer, are fighting alongside them.”

Fact box fiscal year 2019/20 (4/1–3/31)