THE END OF THE SWISS CHALET HOLIDAY?

22nd June 2014

Last modified on September 26th, 2021

The Swiss appear to have shot themselves in the foot.

There has been a gradual fall in the numbers of British skiing in the Swiss Alps because of the poor exchange rate and other factors.

Now the trickle is set to become a torrent as enforced staff costs will push up the costs of doing business for many British tour operators

Next winter Inghams is closing all its chalets in Switzerland except for one chalet-hotel in Verbier.

Its sister companies, Ski Total and Esprit Ski, are pulling out of the country completely and shutting all properties.

The three companies, ironically owned by the Swiss giant Hotelplan, will have no chalet accommodation in Zermatt, Saas-Fee or indeed anywhere else in Switzerland.

The upmarket UK operator, Scott Dunn, is closing its two properties in Zermatt.

The largest independent operator, Skiworld, is pulling out of Verbier totally as it closes Chalet 4 Seasons, Chalet Diana and Chalet Arcade.

They catered for 40 guests per week and were full across every week of the season.

Over in Zermatt Skiworld is also closing two chalets and almost certainly its remaining ones.

Skiworld is looking at trying to keep one in Nendaz but nothing is signed and it looks like it may shut.

The difficult situation in Verbier and Nendaz has been dealt another blow with the breakup of the 4 Vallees ski area as we reported earlier this week on PlanetSKI.

The thousands and thousands of British skiers will either have to stay in Swiss hotels and self-catered apartments or, more likely, simply go to Austria and France instead.

Why?

Well we’ll explain a bit later but just think of the consequences for a moment.

The exit of the British will not just affect the UK operators – their guests buy lift passes, rent equipment and spend money in the bars and restaurants.

There are local taxes to pay, landing fees at airports and souvenirs to take home.

A network of businesses, mostly Swiss-run, offer transfer services, catering supplies and ski lessons.

According to figures from the oldest mainstream UK Tour operator, Inghams, there are 1,500 chalet beds in the Valais canton alone that are filled by British guests each week.

That amounts to almost 25,000 bed nights across the winter.

Inghams calculates that the UK chalet market is worth 52m Swiss francs.

But apart from all the numbers it means the British skier, who has had a long-term relationship with the country, will find it harder and certainly more expensive to ski in the birthplace of modern skiing.

So, what an earth is going on?

Last June, without consultation or discussion, the Federal Government changed a regulation in the employment rules for staff that worked in the catering industry.

In the past the chalet staff were employed under a UK contract and were paid a UK wage.

They paid UK taxes and UK National Insurance Contributions.

Now they need to be paid the Swiss minimum wage for people in the catering industry.

It amounts to 3,407 Swiss Fancs a month, that’s £2,238 which works out at £33,800 a year; around the same as a junior doctor in the UK.

The average salary in the UK is £26,500.

“The Swiss minimum wage is set so workers in the country can afford housing, medical care and food, but we provide them to all our staff as part of their contract,” said the Managing Director of Inghams, Andy Perrin, to PlanetSKI.

“We also transport them to and from the Alps plus provide a uniform, lift pass and equipment hire. There simply is not a comparison,” he added.

The Swiss tourist office in London is deeply saddened at how things have unravelled.

“We have the deepest regret at the situation and have done as much as we can by lobbying the government and arranging meetings with ministers,” said the Director of Swiss Tourism for the UK and Ireland, Marcelline Kuonen, to PlanetSKI.

“We have helped where we can but it is the law. There are really no winners here and we will possibly lose huge amounts of British guests. It is a sad day,” she added.

Talks are going on to see if the situation can be resolved but the prospects are bleak.

There are some exemptions to the law – workplace canteens, cafes in old people’s homes and catering facilities on railway stations – but these exemptions are unlikely to be extended to the British.

A stay of execution was negotiated last year, as the new regulation was introduced without warning on June 30^th and the operators were given a breathing space.

The British operators have been told the law will be strictly enforced this winter.

Shutters down. Image © PlanetSKI

Once the tour operators move out they are unlikely to return.

Many countries with ski resorts court the major UK operators with numerous incentives as they bring regular business; Switzerland seems to have taken an opposite position.

The largest UK tour operator, Crystal Ski, didn’t see this coming but it axed its chalet programme in Switzerland a few years ago as it saw a general decline in interest in Switzerland.

In 2012/13 the Swiss took 5.5% of the British market, up from 4.9% in 2011/12, according the annual Crystal Ski Industry Report, 2012/13.

However in 1999/2000 it was 7.9% and prior to that even more.

The first winter holiday took place in St Moritz and the British invented ski racing in its modern form in Murren in 1922.

The first chalet holiday to Switzerland went to Grindelwald back in 1958.

There is a long and historical tradition of the British skiing in Switzerland.

“What is also sad is the chalet guests often return later in life and stay in our hotels. The staff who work seasons in their 20’s often come back in their 30s and 40s to revisit where they had the best time of their life,” said Marcelline Kuonen.

Verbier; a chalet resort. Image © PlanetSKI

So, how did it all come about?

The move was started by the hoteliers in Zermatt.

They saw the UK tour operators having a commercial advantage as they paid their staff less money and were determined to put an end to it.

Their hotel rooms were half empty in January while the British chalets were full with 95% occupancy levels.

Perhaps understandably, they wanted a level playing field in which to compete with similar staff costs.

Articles appeared in the local Swiss press accusing the British operators of using “slave labour” and of people being “press ganged” into work.

“We have 8.5 applicants for each job and 40% of our Swiss staff return to work with us year after year; they would hardly do that if we were treating them as slaves,” countered Andy Perrin from Inghams. “These are real people with real jobs who have been shafted.”

“The Zermatt hoteliers were both arrogant and naïve and this is the result. It is lose, lose, lose for all and I am deeply saddened,” he added.

“They simply have no understanding of the UK skiers or the UK market as 42% of our clients want chalets, not hotels. The Austrians and the French will win, not the Zermatt hoteliers.”

Here at PlanetSKI we understand many locals in Verbier, where there is a huge chalet presence, take a different view from Zermatt and are concerned at the exodus of the mass-market British tourist.

One Swiss supplier in Saas-Fee burst into tears as she was told by Ski Total that it was closing its chalet-hotel.

“But we have been working together for years and you have been bringing in many guests who all leave happy. What am I to do?” she said as she saw business evaporating in front of her eyes.

The British-run ski and snowboard school, European Snowsport, has branches in Zermatt and Verbier.

“It is a short-sighted move as the British chalet holiday is a unique product and it is sad to see the main operators pulling out. Many of the British guests, who have been coming to Switzerland for generations will simply go elsewhere,” said the Managing Director of European Snowsports, Julian Griffiths.

“We deal with many high-end and luxury properties and they will absorb the extra costs into their prices as the clients are wealthy, but it is not so for the mainstream chalet operators.”

To say the British will simply stop skiing in Switzerland is though far from the truth.

The upmarket holiday company VIP SKI is keeping its two properties in Zermatt and two more in Verbier.

“We are confident we can keep the business economical,” said the Sales and Marketing Director of VIP SKI, Gareth Crump, to PlanetSKI.

VIP SKI has always traded as a Swiss comapny so its business model is largely unaffected.

The well-off will undoubtedly continue to go to Switzerland but it is now out of the price range of many British skiers and snowboarders.

The tour operators will still sell holidays to the Swiss resorts but it will be in hotels rather than the all-inclusive, catered chalet.

Some people on a budget who like to ski in Switzerland will move across to self-catered appartments, but this product has been declining in popularity in recent years as in many cases it works out more expensive than a chalet.

“It’s sad, really sad, as a single and unique product in the market has vanished at a stroke,” said the Sales and Marketing Director of Skiworld, Diane Palumbo.

“I’m gutted as many of our Swiss properties had such a loyal following. The affordable Swiss chalet holiday has simply disappeared from the brochures.”

So, have the Swiss shot themselves in the foot?

No.

Many people that we have spoken to in the UK, and in Switzerland, think they have shot themselves in the head.

End of the run? Image © PlanetSKI

For the spirit of the mountains