WHITEFISH -- Mike Cann was a relative rarity in the Whitefish Mountain Resort parking lot this week, for two reasons.
One, he didn’t have skis with him, having injured a knee the day before.
The other thing was, he was driving a vehicle bearing Alberta license plates.
Canadians like Cann are in short supply in Montana these days. Those plummeting gas prices many Americans are enjoying are turning out to be bad news on other fronts.
The cheap price of a barrel of oil has weakened the energy-dependent Canadian dollar, better known as the loonie -- so much so that it’s keeping lots of folks home who used to cross the border to shop, vacation or be entertained.
Right now, it’s costing Canadians about $1.40 of their money to buy what an American can for his or her $1 -- or $140 for every $100. That’s having an effect here.
“It’s very noticeable,” said Kris Nygren, an employee at The Shops Under One Roof, a business on Whitefish’s Central Avenue that offers “antiques, curiosities and chance finds.” “It’s very slow. I don’t think we realized how big a difference they were making.”
“Downtown is not nearly as busy as usual,” agreed Cyndi Sweet, who works at nearby Sappari, a woman’s clothing and home décor shop. “I’ve worked downtown for 25 years, and it’s different this winter.”
Joe Unterreiner, president and CEO of the Kalispell Chamber of Commerce, says the impact has been greatest on retailers in the region.
“The flip side is cheap gas, which has increased domestic visitation,” Unterreiner said. That’s helped the hospitality industry counter the drop in Canadian visitors, he added.
But those from Washington, Illinois or other states who travel to the Flathead Valley don’t, as a rule, do so to purchase a major kitchen appliance or big-ticket outdoors gear.
When their dollar was stronger, Canadians did so in droves.
Cann was in Whitefish with his wife Mona, teenage daughter Amelia, and four of Amelia’s friends, primarily because six years ago, when the Canadian dollar was considerably stronger, he and his wife purchased a vacation home in Ptarmigan Village.
“When you have a place here, it’d be silly to go anywhere else,” he said
But now, he and Mona are considering selling their Montana property.
“If we sell now, we could profit substantially because of where the dollar is at,” said Cann, who lives in Airdrie, Alberta, just north of Calgary.
Earlier this month, the Canadian dollar dropped to 69 cents U.S., its lowest point in 13 years. While it was back to 71 cents by week’s end, a forecast from David Doyle of Macquarie Capital Markets Canada Ltd. indicates that it could fall as low as 59 cents in 2016.
The loonie has never been that low. The record is 61.79 cents U.S., set back in 2002.
The lower it drops, the less Canadians can get for their money in the U.S.
Cann, who has vacationed in northwest Montana most of his life -- the vacation home in Ptarmigan Village isn’t his first -- said it’s his experience that Canadians can break pretty close to even on trips to the States when the loonie is worth at least 80 cents U.S.
“Anything above that is gravy,” Cann says.
A fellow Albertan found getting ready to do some cross-country skiing on Whitefish Mountain thinks that even at 70 cents, Montana is not a terrible deal.
Not all doom and gloom
“My impression is that Montana is still pretty cheap,” said Richard Holmes, a visitor from Edmonton who has a timeshare at Whitefish Mountain and has been vacationing in Montana for 20 years. “Gas is cheaper, groceries are cheaper, beer is cheaper, eating out is cheaper. Lift tickets, even with the exchange rate, are about the same as they are at our major resorts.”
These days in Edmonton, he said, he pays $2 for an apple, $4 for broccoli, and the price of meat has doubled this winter.
Fuel prices in Canada have dropped, but not by nearly as much as they have in the U.S. The price at most pumps in Alberta is around 75 cents, but in Canada gas is sold by the liter. It takes 3.7 liters to equal a gallon, making gas in Alberta roughly $1 more per gallon than in Montana.
“Alberta is all about oil, and we’re really hurting right now,” Holmes said. “Our grocery prices have inflated hugely, but it’s more about the fact that oil has kicked our economy in the stomach.”
The province has lost 31,000 energy-related jobs since the price of oil started dropping many months ago. Unemployment has gone from 4.7 percent to 7 percent in the past year.
Cann is part of those statistics. He said he was one of more than 800 employees laid off by TransCanada, the energy company that owns thousands of miles of oil and gas pipelines, where Cann worked as a measurement technician.
“I’m not a victim,” Cann said. “I’m actually pretty happy. It’s not all doom and gloom unless you don’t save money when you’re making money. If you think ahead you can live a long time when things get bad.”
Buying -- and selling -- vacation homes in Whitefish at the right times have become part of that strategy.
“If we sell, I think if we give it four or five years the loonie will be back to 90 cents, and we can buy again,” Cann said.
Changes in real estate
Real estate is another sector of the economy being influenced. When the Canadian economy was booming and local real estate prices were still recovering not that long ago, hundreds of Canadians like the Canns bought properties in the Flathead.
Last year, it was down to a handful of sales. Now, with the benefits of converting those assets to U.S. dollars and taking the profit north of the border, Cann is probably not the only Canadian thinking about selling.
Here’s another effect: According to Canada’s Financial Post, Americans are heading to Canada in record numbers in search of good deals on used vehicles while the loonie is low.
The Financial Post quotes DesRosiers Automotive Consultants as saying that, as the value of the loonie fell, almost 200,000 used vehicles were imported into the U.S. from Canada in 2015, up from 75,000 in 2014.
“Much below 90 cents (U.S.) you start to see a trickle going south and now that we’re down into the 70-cent range, it’s more of a flood,” Dennis DesRosiers, president of the consulting business, told the financial newspaper.
Effects on retail
Retailers of all sizes have felt the downturn in Canadian visitors. Montana saw a 4.2 percent increase in vehicle traffic entering from other states in 2015, according to the University of Montana’s Institute of Tourism and Recreation Research, but a 6.3 percent decrease in traffic coming in from the north across the Canadian border.
That’s especially hard on places like Great Falls, a popular destination for shoppers from Alberta and Saskatchewan when their dollar is strong.
In the Flathead, the decrease in Canadians can at least be made up for, in part, by an increase in tourists from places other than Canada. Glacier National Park broke its visitation record for a second straight year in 2015, and Glacier International Airport set a record as well.
But they aren’t buying refrigerators or skis while they’re here, like many Canadians often did.
“It certainly has affected our business levels,” said Will Cornett, manager of the Sportsman & Ski Haus store in Whitefish. When the loonie was stronger, “It seemed like a lot of Canadians would come down, and by the time they had put their money into new skis or whatever, they were still breaking even. It was like they got a free trip out of the deal.”
“We probably make money coming to the U.S” when the two country’s dollars are on a par, Holmes said.
Cann says he expects that to be the case again -- it’s just a question of how long it will take for Canada’s economy to recover from the glut of oil on the market.
Until then, in Whitefish Mountain’s parking lots, you may find as many or more license plates from the East Coast -- there were ones from states from Maine to Florida last week -- as you do from next door in British Columbia and Alberta.