Press Conference Speech
17 July 2008, OutDoor, Friedrichshafen, Germany
Rolf G Schmid
President, European Outdoor Group
CEO, Mammut Sports Group

Welcome
Good morning everyone and welcome to the 15th OutDoor Fair to be held in the town of Friedrichshafen.

At the end of last year, most of you were aware that we were nearing the end of a lengthy process to decide where the OutDoor Fair would be held for the next five years. This was a difficult time for the European Outdoor Group as there was a huge amount of information to be considered, discussed and decided upon and when we took our decision at the end of January 2008, the whole of the industry was waiting eagerly for the result. We were delighted to announce that the majority wish of our group was to remain here in Friedrichshafen with our long term partners Messe Friedrichshafen. The decision to keep our Fair here until at least 2013 is a great endorsement of the work done by the Messe Team and City of Friedrichshafen and over the next few years we look forward to continuing the growth and success of the OutDoor to the benefit of everyone concerned. Three key factors supporting the decision to stay in Friedrichshafen were:

• The natural surroundings of the Lake Constance area
• The continuously improving infrastructure of the Messe Friedrichshafen
• The commitment of the city of Friedrichshafen to improve the traffic and transportation, including airport connections, trains and buses.

Theme
Each year we agree a theme for the OutDoor Fair and our intention in doing so is to stimulate debate, exploration and learning within the sector. Few of us here will be unaware of the increasing awareness of climate change and the emphasis on sustainability within the business community, and in recognition of this, our theme for this years OutDoor is ‘The Challenge of Sustainability’.

We have very deliberately used the word CHALLENGE as this is not about what the industry is doing already; it’s about how the industry reacts to the new challenges facing us and how we can explore best practice.

Our industry cares deeply about the environment and we have always taken great pride in our close contact with nature. But still, we can and must do more to address our use of resources and to model our businesses on best available information and technology. So to facilitate this there is a wide ranging programme of events to engage everyone at the fair in this vital debate.

Related to this subject, the EOG Association for Conservation will tonight announce the names of the 8 environmental projects that will receive a total of EUR€171,000 of funding from the Association. We are delighted that one of the groups chosen by our members is a local Bodensee project and that in this small way; we are able to engage directly with the beautiful natural heritage of this region.

The future and a changing industry
Whilst I have deliberately not gone into a great deal of detail with regards to the issue of sustainability as this will be covered by the events planned over the next few days, I would like to speak to about some of the tendencies that we see on the horizon.

Over the last decade we have all become accustomed to being able to fly cheaply and simply to almost any destination we desire and this of course has had an impact on the patterns of domestic tourism as related to the outdoors. Now we are starting to see a change in habits as more people are looking for simpler alternatives to the seasonal queues at the airports. The idea of not travelling abroad and instead, exploring the natural environment of your home country is gaining momentum. This trend can only be strengthened by the likely increase in travel costs as escalating oil prices bite deeply. Traditional outdoor activities like camping are starting to see resurgence and this movement can only be to the benefit of the industry.

Of course the situation with regards to oil and energy prices is going to have an overarching influence in many other areas and not least on the costs of production. Our high-tech fibres and fabrics are heavily dependent on the petrochemical industry which when coupled with increases in the cost of transporting goods leads us to believe that significant adjustment to prices might be necessary over the next few years. This however is all against a backdrop whereby in real terms the cost of technical outdoor products is much lower today that it was say 10 years ago. Competition, new sources of production and volumes, have all helped the industry to produce a falling price scenario over recent years and which in the medium term, is no longer sustainable. An increasing focus on sustainable fabrics, sustainable sources of production and an increased investment in ensuring the sector has a low carbon footprint will all mean a higher price to the consumer.

An industry such as ours will find its own equilibrium over these issues and these changes cannot be described as either positive or negative. So for example, the potential savings on not holidaying abroad might well be spent on buying more expensive equipment to ensure that the holiday is enjoyable. Or we may find an overall reduction in volumes within the industry, but an increase in the longevity of the products and products sold at a correspondingly higher price. At present it looks as if the world’s economies could fall into a recession and we will have high rates of inflation. The problems created by the US subprime and credit crisis are inevitably having an impact in Europe, but the outdoor industry has in the past proven to be quite resistant to such pressures and we will be watching closely as the situation develops. We believe our customers are not ready to renounce their favourite outdoor leisure activities and will tighten their belts in other areas first. This means that for the time being, there is no reason for us – the outdoor trade – to fear the future.

Little to fear for the future, but no one can predict these things with any degree of certainty. What is certain though is that the industry is set to change over the next few years, and with change comes a whole range of opportunities. The appeal of outdoor activities is stronger than ever and the industry has been growing year by year. So we look forward to our challenges and are certain that our industry is responsive, adaptable and ready to face the next few years with enthusiasm and creative flare.

We wish everyone a successful and enjoyable OutDoor.