Category Archives: NEV

Polaris Posts Strong First Quarter 2014 Results

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Beauty shot of the new Sportsman ACE from Polaris.

The new Sportsman ACE from Polaris is one of the reasons for the company’s strong financial results for Q1 2014.

The following are some of the highpoints of the Polaris earnings call discussing their first quarter 2014 financial results with a focus on aspects relevant to the STOV market.

  • Polaris first quarter sales increased 19% to $888 million.
  • Net Income increased 7% to $80.9 million.
  • Management is raising their expectations for full year revenue and earnings to increases of 14%-16% and 17%-18% compared to 2013.
  • Off-Road Vehicle sales which includes UTVs and ATVs increased 11% and market share improved with good demand for the RZR XP 1000 and the new Sportsman ACE.
  • In North America management estimated that side-by-side sales retail grew upper single digits in an industry that grew similarly.
  • The new Sportsman ACE has gotten off to a good start.
  • PG&A momentum remains very strong with first quarter sales up 20%, parts accessories and apparel all grew strong double-digits led by strength in both ORV and Motorcycle related products.
  • First quarter Polaris commercial revenues increased by over 60% with sales to Bobcat Polaris national accounts and BRUTUS up notably year-over-year. Commercial segment has grown more slowly than expected by management but they will continue to put resources into this segment.
  • Small Vehicle first quarter revenue increased by 248% as all three brands, GEM, Goupil and Aixam grew year-over-year. The increase includes the addition of revenue from recently acquired Axiam, which also increased market share in Q1, and an increase of over 20% from the GEM product line.
  • International business had another strong quarter with sales increasing 44% led by nearly 50% and 60% growth in the EMEA and Asia Pacific regions respectively. Small Vehicles, PG&A and side-by-side sales all grew over 30%.
  • ORV is now expected to grow 9% to 11% in 2014.
  • Small Vehicles guidance is unchanged up 25% to 30% which includes the full year of the Aixam acquisition.
  • ACE orders in both North America and internationally have been better than expected with only minimal signs of cannibalization of either ATVs or side-by-sides.
  • There is broad based strength across many ORV products.
  • Management is seeing increased competitiveness and promotions in the side-by-side market.
  • Management is disappointed in Brutus sales into the commercial segment so far but expect to see improvement over the next 12 months as dedicated sales staff, partnership with Ariens and other efforts help them adjust to the longer B2B and B2G selling cycles in this segment.

Learn more:  Seekingalpha.com (earnings call transcript)

Comment:  The early signs that the ACE is not cannibalizing ATV and UTV sales is an indicator that Polaris is creating another vehicle category. More time will be needed to see how sales play out over the next 12 months to see if this theses remains true. It’s not only a question of cannibalization but how buyers are actually using the vehicles – what market segments, what applications, etc.

LSV Taxi Service Seeks Private-Public Partnership

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In Gulfport, FL a group of investors behind a LSV taxi service called GetGo is asking for some funding from the city. The concept behind GetGo is to provide transportation in the downtown area where parking problems can occur during certain peak times. The LSVs would be leased to drivers who would not charge fares but would earn income from tips. Revenue would also be generated from seven advertising placements on each vehicle. GetGo, which will be getting funding from the Gulfport Chamber of Commerce and Gulfport Merchants Association, would be formed as a non-profit and be responsible for maintenance and liability and property insurance. The city and the other funders would each have a seat on the company’s board. While there are some reservations about public funds for a service that might compete with private taxis, the city will investigate the possibility of funding the venture further. Investors are asking the city to provide $10,000 to $11,000 annually.  Learn more:  TheGrabber.com

Comment:  This is an interesting approach which could create a model for LSV taxi services that could be applied in other cities. In the past, these type of no-fare, advertising and/or tip based services have run into some obstacles. Often, it is the existing taxi services or local officials who are concerned about mixing LSVs with other vehicles on local streets. A typical compromise is to limit the LSVs to a certain part of the downtown where their low speed, zero emissions and low noise characteristics are put to the best use.

Club Car Launches Newly Overhauled Line Of Carryall Utility Vehicles

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Club Car has launched a new line of Carryall UTVs.

Club Car has launched a new line of Carryall UTVs.

New Carryall UTV from Club Car

New Carryall UTV from Club Car

Club Car announced their new line of Carryall utility vehicles which feature significant changes to the vehicles. One key feature of the line is a new engine developed by Subaru.

The 14-hp-rated, 404-cc, single-cylinder overhead cam engine features electronic fuel injection (EFI), capacitive discharge ignition (CGI), hemispherical heads and a case-hardened steel timing chain that enhances reliability. A splash lubrication system that eliminates the need for oil filters simplifies maintenance and reduces environmental waste.

The engine will be warrantied for 3 years and 3,000 hours, up from the previous 2 years and 2,000 hours. The product line will continue to have an aluminum frame, rack and pinion steering and independent front suspension. Other key features include:

  • 30% more horsepower and 50% more fuel efficiency
  • Electric models have an inboard solid state charger that is programmable for different algorithms depending on battery type i.e. flooded lead-acid or AGM and 10% more efficient than the previous one
  • Movable bed dividers and cargo tie-downs and ability to accommodate ladder racks, bucket holders and other accessories
  • Rhino lining for the cargo bed floor is standard
  • New body and interior styling for better ergonomics and usability
  • Integrated halogen headlights with an LED option
  • Optional cab designed to integrate with vehicle design
  • A street-legal LSV model configuration and six passenger Transporter model

Learn more:  PRWeb.com

Comment:  The product line is being marketed as a replacement for pickup trucks in the commercial and industrial markets. This is a fast growing segment in work segment of the UTV markets. The savings is not so much in the front-end costs but all the insurance, maintenance and fuel costs during the life of the vehicle. UTVs like the Carryall can also offer productivity improvements as they can prove more versatile and better access work areas than larger pick-up trucks. The electric vehicles are particularly popular with colleges/universities, parks and municipalities that have green or sustainability policies. This is one of the reasons that the UTV market has continued to grow at a good pace despite a slow economic recovery.

LSVs Show Strength in Government & Commercial Markets

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A six passenger transport vehicle from Cruise Car with a solar array on the roof for battery recharging.

Cruise Car out of Sarasota, FL reports growing sales on the strength of orders for  government and commercial markets. The company manufacturers golf cars and low speed vehicles for transport and utility. A key differentiator for the company is their Sunray Solar Roof Canopy which uses solar power to recharge vehicle batteries. They also feature an aluminum chassis and AC electric motors. According to management the company has been successful selling vehicles to military installations and last month was awarded a contract to supply fleets of shuttles and light utility runabouts to VA Hospitals and VA Cemeteries nationwide. Hotels and resorts are also an important market segment for the company. Many of the vehicles they sell to these markets are LSVs which can be used on public roads. Learn more:  HeraldTribune.com

Comment:  The companies success confirms with what we have been hearing from dealers around the country. Namely that STOVs and in particular LSVs are selling well in the commercial and government markets. The military and other government sectors are attracted in part to the fact that the vehicles are electric powered, whether to reduce fuel costs and/or meet sustainability goals. This is also true of the college/market where they can be used for personnel transport or light utility work around campus. The safety features of LSV compliant vehicles are appealing to buyers as well.

New Concept Drawings for Coachella Valley Multi-Use Parkway

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Concept drawing for multi-use parkway between Palms Springs and Coachella in California

The Coachella Valley Association of Governments presented new concept drawings for a 52 mile multi-use parkway for pedestrians, cyclists and LSVs/NEVs. Running along the Whitewater River wash between Palm Springs to Coachella, the drawings depict a parkway with “interactive kiosks where people would be able to see the trail’s real-time impacts on air quality and greenhouse gases and night-time laser light shows that would be motion-activated as users walked or cycled by.” Shade structures and color accents are key parts of the design. The concept also includes different configurations for the parkway as it conforms to the changing landscape along the 52 mile route. There has been mixed reaction to the parkway and some gated communities and country clubs would rather not have the project run through their properties. The exact route is still being worked out with potential alternatives for bypassing these properties being considered. In general, the cycling community is behind the project, if not enthusiastically. CVAG has pitched the project with an $80 million price tag — $70 million for construction and $10 million for operation and maintenance. Federal and state transportation and air quality funds will help fund the project.  Learn more: Mydesert.com

 

Road Use Regulations Roundup – September 2013

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Some trends in this latest regulation roundup:

  • Municipalities are passing ordinances that not only allow LSVs but a range of utility vehicles including UTVs, ATVs and mini-trucks on public roads. The ordinances for mini trucks, which operate at higher speeds, may be the beginning of a backdoor approach to more medium speed vehicle ordinances at the local level.
  • There appears to be less concerns being raised about safety issues of the vehicles in mixed traffic.
  • Ordinances governing LSV parking were common this roundup.
  • There appeared to be less road use regulatory activity at both the state and municipal level so far in 2013.

State Level Regulations

Florida – A new golf car law went into effect that allows for the conversion of faster golf cars – or similar low-speed vehicles – to even lower-speed cars, saving golf car owners registration and insurance fees. A one-time $40 fee is charged.

Minnesota – A bill that would allow operation of mini trucks on local roads as passenger automobiles has been introduced in the House and Senate.

Municipal Level Regulations

Garden City, KS – The Garden City Commission drafted an ordinance which would allow micro utility vehicles (UTVs) to be operated within the city limits. The vehicles will be subject to state safety requirements such as roll cages, head and tail lights, turn signals and seat belts and will only be allowed to be operated by legally licensed drivers.

Britt, IA – The City Council is considering an ordinance to allow low speed vehicles on Main Avenue where they currently are not allowed. Some council members are concerned about safety and creating an opening for golf car use on the street.

Nederland, CO – An ordinance allowing electric golf carts was discussed.

San Antonio, TX – City Council has approved an ordinance that allows owners of NEVs to operate their vehicles on city streets with speed limits of 35 miles per hour or less. Several accidents in 2006 resulted in the vehicles being banned.

Powell River, British Columbia – The Council considered a low speed vehicle ordinance. A number of cities in the province have passed similar ordinances.

Baton Rouge, LA – The city is discussing the regulation of LSV taxis. The Taxi Control Board wants them to be regulated similar to other taxis.

Medford, MN – The Medford City Council is considering an ordinance to allow residents to use golf cars, all-terrain vehicles and mini trucks on city roads. The vehicles will need to be permitted, meet certain equipment requirements and operate on the streets only during specified hours.

North Wildwood, NJ – The City Council approved up to  20 designated parking spaces for LSVs. These spaces will be clearly marked and only low-speed vehicles may park in these spots.

Jascksonville Beach, FL – Council takes comments from the public on low speed vehicle parking in the city.

Santa Monica, CA – The city is trying to clarify free parking rules for electric vehicles that are tied to state issued zero emission stickers. The state rules governing the stickers narrowed the definition of eligible vehicles in such a way as to exclude LSVs, which previously had been included.

IndyCar Champion Ryan Hunter-Reay Is Now A Garia Ambassador

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IndyCar champion Ryan Hunter-Reay with his high-end race car and high-end golf car from Garia

While at first glance the juxtaposition of a high speed IndyCar champion with a Garia street-legal low speed vehicle might seem funny, the pairing of a race car driver and a high-end golf car is more common then you think. A golf car dealer I know has in fact built a number of customized golf cars for some of the top NASCAR drivers and owners. These are highly customized vehicles that are often made to match the driver’s traveling coach and are taken along as they travel from race to race. They are quite handy for traveling around the racetrack grounds. They also involve quite a bit of engineering since they are a little faster than your typical golf car. Add in the bling and custom paint jobs and you are talking about a $20,000 to $30,000 vehicle or more.

The press release from Garia follows:

INDYCAR CHAMPION RYAN HUNTER-REAY IS NOW A GARIA AMBASSADOR

Garia, the manufacturer of the ultimate luxury golf and leisure car is pleased to announce a new exciting partnership with IndyCar Champion Ryan Hunter-Reay.

Ryan Hunter-Reay is the reigning IndyCar Champion and the most successful American currently competing in the IZOD IndyCar Series with more than three times as many wins as all the other current American drivers combined. Ryan is the recipient of the 2013 ESPY for best driver.  Ryan is also the only driver to have earned wins in IndyCar, CART, ChampCar, ALMS and GrandAm.

With Garia’s unique combination of craftsmanship, passion and performance the Ambassadorship is a perfect match. Ryan Hunter-Reay is dedicated to his sport and has a unique winning mentality. He is an expert in car performance and knows the importance of excellent craftsmanship and functionality, however he is also a family man.

Garia has built a four-seater street legal LSV for Ryan Hunter-Reay, with customized Garia Mansory accessories such as super-car inspired steering wheel, dashboard and side mirrors handcrafted in carbon fiber.

“This street legal Garia is the ideal leisure car for me and my family’s active lifestyle. The quality, driving performance and braking system gives me and my family a feeling of safety, especially when we have our baby boy on board. We love the design of the Garia and its amazing carbon fiber accessories!” said Ryan Hunter-Reay.

Ryan will be bringing his Garia with him on the racing tour enabling it to function as his primary transportation when not in the race car. The street legal ability of the Garia allows it to not only be driven inside the race circuit, but also taken outside and driven on public roads. Ryan has added a custom Hydra-Lift to his motorcoach which will transport the Garia to the various race events from Florida to California and points in-between.

“Garia’s marketing strategy has focus on golf and leisure. Last year we introduced the world-famous golfer Paula Creamer as our brand ambassador. Today we are very proud to introduce IndyCar Champion Ryan Hunter-Reay to our brand ambassador family. We feel the four-seater street legal LSV truly complements Ryan’s active lifestyle. We have many shared values such as dedication to craftsmanship, performance and the passion for the joy of driving a high quality car. We are confident the Garia will suit his needs” said Anders Lynge, designer of the Garia.

The Garia is created in collaboration with golf professionals and is designed, engineered and built in Europe. The Garia design team has been uncompromising in its efforts to create the best golf car in the world. Luxury features on the Garia include a built-in refrigerator, extra comfortable sport seat and 12” alloy wheels. With the Garia Mansory Accessory Program, it is possible to customize the luxury golf and leisure car into the vehicle you always only dreamt of. The Garia is available in various models, including street legal, two- and four-seater versions as well as a roadster.

Explore more

Press images of Ryan Hunter-Reay and his Garia, please contact press@garia.com

More information about this new partnership http://garia.com/explore/Ambassador-Ryan-Hunter-Reay/

More information about Garia http://www.garia.com

More information about our recent model http://www.garia.com/vehicles/garia-mansory-currus-edition

Follow Ryan Hunter-Reay on Twitter: @ryanhunterreay

Follow Garia on Twitter: @gariagolfcar

Bad Boy Mowers Expands: Targets UTV Market

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Intimidator multi-terrain vehicle from Bad Boy Mowers

Bad Boy Mowers of Arkansas has announced plans to hire more than 200 people in the next three to five years as the company expands it’s offerings in the UTV market. The manufacturer of lawn mowers also started producing utility vehicles several years back but has moved more aggressively into the UTV market with the launch of the affiliated company and brand, Intimidator in 2011. The company spent $7.5 million to expand their plant for the new product line.

The Intimidator series features a 1,600-pound payload and a 2,100-pound towing capacity. The company will be producing 10 new multi-terrain vehicles, as they like to call them, expanding the total number of models they offer to 16. The Intimidator product line includes diesel, gas and electric versions. Previously, under the Bad Boy Mower brand the company has also offered a range of UTVs including some that are LSV compliant UTVs. Learn more:  PBCommercial.com

Comment:  And the competition in the UTV market continues, this time in the work UTV segment. Creating a new brand is probably the best way to go as UTVs do not initially come to mind with the name Bad Boy Mowers. There could also be some confusions and possibly even legal issues with the Bad Boy Buggies brand owned by E-Z-GO. However, the company should still be able to leverage the Bad Boy Mower dealer network, which at first glance seems concentrated in the Midwest and East, to grow the Intimidator line. Distribution is key in this market as so many manufacturers entered from adjacent markets like powersports, farming, power equipment, golf, etc. They often can reach parts of the market or certain segments with their traditional distribution networks but then have trouble expanding further.

Polaris Reports Another Strong Quarter for Q2 2013

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Polaris Ranger XP 900 helped drive overall sales in the second quarter of 2013

Polaris Industries just announced their Q2 2013 financial results and reported another quarter of strong earnings and market share gains. The following are the highlights of the earnings call with analysts with a focus on the STOV segments.

  • Sales for the second quarter increased 12%, to a record $844.8 million driven by share gains and double-digit retail growth in North America
  • Polaris captured market share in ATVs and side-by-sides which also drove significant gains in PG&A business
  • Second quarter net income rose 15% to $80 million yielding record earnings per share of $1.13, a15% improvement over the prior year period.
  • PG&A sales increased 33% for the quarter
  • ORV segment which includes ATVs and UTVs  performed well fueled by the RANGER 900 XP and supported by RZR products.
  • Revenue for ORV was up 7%, which is less than retail as inventory was reduced in preparation for new model launches.
  • Gained North American market share in both ATVs and side-by-sides.
  • North American side-by-side retail sales strengthened in the second quarter, up double-digits percent driven by growth in both RANGER and RZR categories. In fact, both brands had their largest unit retail quarters in their history.
  • Management estimates the North American side-by-side industry also improved, growing just under 10% in the second quarter and is now up upper-single digits year-to-date.
  • Initial Brutus shipments began into over 400 Polaris commercial dealers.
  • In the military segment Polaris remains the clear #1 in ultralight tactical vehicle space with the new MRZR is selling well globally
  • Due primarily to the Aixam purchase and contributions from GEM and Goupil, small vehicle revenues increased $22 million and 190% for the second quarter. Year-to-date, sales are up 109%.
  • GEM business is improving with second quarter retail sales were up in excess of 50%. Management reports better operations for GEM and improved traction in the B2B market place, particularly in the People Mover sub-segment.
  • Goupil also had a strong second quarter with orders up over 30% and notable cost and productivity improvements in operations, driving gross margin improvements.
  • ORV PG&A sales increased 25% and small vehicles 165%.  “The attachment rate that we’ve seen on the Ranger 900 XP with the new integrated cab system is phenomenal.”
  • In Europe – Polaris’ Q2 ORV retail grew and year-to-date, is about flat in an ORV industry that remains down double digits. Polaris maintains their leading position.

Looking ahead:

  • Future Sales of Off-Road Vehicles are expected to increase in the 8% to 10% range with retail sales of side-by-side vehicles and ATVs outpacing the overall market in North America and internationally
  • ORV market share is expected to continue to increase in 2013
  • For small vehicles, which includes the GEM and Goupil businesses, along with the recently acquired Aixam Mega, sales are expected to increase well over 100% for the full year 2013.
  • Both GEM and Goupil are expected to increase sales for the full year over last year total company sales increase in the range of 13% to 15% for the full year 2013.
  • Management is not feeling pricing pressure in the UTV market as they are confident that the Polaris brand/product can garner a price premium
  • Process improvement in small vehicle operations are improving quality and delivery as well as reducing costs. Management feels they are positioned very well in this space for strong growth.
  • The Bobcat dealer network has lagged Polaris in the commercial utility segment and the sell through of the Brutus vehicles will be slower than consumer vehicles because of the slower commercial vehicle buying cycle.
  • Management was even more upbeat than usually about the 2014 models that will be announced at the dealer meeting in a few days.

Learn more:  Seekingalpha.com (Earnings call transcript)

Comment:  Polaris management continues to execute on their strategic plans very well. They are setting the industry standard for inventory management, operational efficiency and product development and innovation. In an increasingly competitive market it will be interesting to see what features and innovations their new models will have.

New Florida Law Allows Conversion of LSVs to Golf Car Speeds

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A new Florida law went into effect on July 1, 2013 that allows owners of low-speed vehicles to mechanically convert their vehicles to normal golf car speeds of 20 mph, which lowers their insurance costs. Reportedly thousands of Florida residents are waiting to make the change. The conversion can save an owner between $500 to $800 in insurance costs since a typical golf car can be insured for only $100 compared to $600 to $900 for an LSV. They can also save on the annual LSV registration costs of about $50. The conversion costs about $40.  Learn more:  WUSFNews

Comment:  This law further blurs the line between golf cars and LSVs. While most of the time this hurts the LSV market by making golf cars a more viable substitute, this time the law should help the LSV market by significantly reducing LSV operating costs in a major market for the vehicles. With its many retirement communities geared to golf car or LSV use, Florida has more than 5,000 registered LSVs or golf cars modified to meet LSV requirements.