Can-Am Announces New 2016 Side-by-Sides

Posted on June 5, 2015 by Marc Cesare

Can-Am has added to their side-by-side lineup and upgraded some of their existing side-by-sides for model year 2016. Most of the changes were made to the Maverick line as Can-Am is clearly targeting the more purely recreational segment of the side-by-side market for growth. Even in the mixed recreational and utility oriented Commander lineup the major change has a recreational tilt with a new hunting edition model. From a strategic point of view, this is somewhat of a contrast to other powersports manufacturers that have been trying to expand more into pure utility vehicle segments or the recreational/utility crossover vehicle segments. This is not to say others, like Polaris and Arctic Cat, aren’t continuing to pursue the purely recreational vehicle segment, they are, but at the same time making a concerted effort to break into to other segments.

The Can-Am changes continue to reflect the importance of horsepower in the pure recreational segment as they have tweaked their turbocharged 1000R Rotax engine to put out 131 hp. They are also pressing what they see as an advantage, their turbocharged engine, by adding several turbocharged models. Key additions and changes to the Can-Am side-by-side lineup include:

Revised the 131-hp Rotax 1000R Turbo engine with larger injectors, increased boost pressure and re-calibrated the CVT.
A new 60-inch wide model, the Maverick xc DPS 1000R, for use on narrower trails and with 12 inches of suspension travel.
A Dynamic Steering Package (DPS) model variation is available in the Maverick DPS 1000R and Maverick MAX DPS 1000R and includes cast-aluminum wheels, Visco-Lok QE, Tri-Mode DPS and two color options.
The 2016 Maverick 1000R Turbo in White Light Grey – Manta Green

The 2016 Maverick MAX 1000R Turbo in White Light Grey – Manta Green
The Maverick 1000R TURBO and the MAX 1000R Turbo, which seats four, are powered by the revised 131 hp Rotax 1000R Turbo engine and also include:
- Front and rear FOX 2.5 PODIUM RC2 shocks with single-speed compression and preload adjustments
- 14-inch painted black cast-aluminum wheels
- 28-inch Maxxis Bighorn 2.0 tires
- The 2016 Maverick X rs 1000R Turbo in Carbon Black – Can-Am Red
  
  The 2016 Maverick MAX X rs 1000R Turbo in Carbon Black – Can-Am Red
Maverick X rs 1000R Turbo and MAX X rs 1000R Turbo models feature:
- 131-hp Rotax 1000R Turbo engine
- Longer 88 in. wheelbase
- Torsional Trailing A-arms independent rear suspension with sway bar and 16 in. of travel
- 4-point harness system
- Yoshimura exhaust
- Rear bumper
- A suspension calibration tuned in partnership with FOX
- Carbon Black & painted Can-Am Red color pattern
- MSRPs: X rs 1000R Turbo – $23,999; MAX X rs 1000R Turbo – $26,599
- New for 2016 is the Commander Mossy Oak Hunting Edition
Commander line adds a Mossy Oak Hunting Edition which features:
- Mossy Oak Break-Up Country Camo
- Gun scabbards
- Front bumper
- Aluminum skid plate
- Roof
- Half-windshield
- Bed rails
- Mudguards
- 14 inch cast aluminum wheels and Maxxis Bighorn 2.0 tires
- 4,500 lb. Warn winch
- MSRP: $18,849
New electronic belt drive protection for the Commander MAX models is now standard. It offers belt-spotting protection for when a driver is in high gear, but should be in low gear. The vehicle will not move and a “LOW GEAR” message will appear on the gauge, alerting the driver.
New & updated color schemes
- Light Grey (Commander 800R base)
- Viper Red (Commander DPS 800R / 1000)
- Mossy Oak Break-Up Country Camo; (Commander XT 800R / 1000 and Commander MAX XT 1000, Commander Mossy Oak Hunting Edition 1000)
- Matte Black & Octane Blue; (Commander XT 800R / 1000 and Commander MAX XT 1000)
- Cognac (Commander Limited 1000)
- Light Grey (Maverick 1000R base)
- Light Grey & Can-Am Red color option (Maverick DPS 1000R and Maverick MAX DPS 1000R)
- Light Grey & Octane Blue (Maverick X xc 1000R)
- Hyper Silver, Black & Octane Blue and White, black & Can-Am Red color option (Maverick X mr 1000R)
- White, Light Grey & Manta Green (Maverick 1000R Turbo and MAX 1000R Turbo)
- Hyper Silver & Octane Blue (Maverick X ds 1000R Turbo and MAX X ds 1000R Turbo)
- Carbon Black painted & Can-Am Red (Maverick X rs 1000R Turbo and MAX X rs 1000R Turbo)

Learn more: BRP.com

Kawasaki Reveals New 2016 Side-by-Side Models

Posted on June 3, 2015 by Marc Cesare

Kawasaki announced an extensive lineup of new 2016 side-by-side, revealing new models for both work and recreational uses. Kawasaki filled out their full size work utility vehicle offerings by adding single seat Mule FX and DX variations to their Mule FXT and DXT models. If you recall, the FXT and DXT models can fit three people or be reconfigured to fit six by transforming the cargo area into an additional bench seat with a smaller cargo bed. For those buyers who only need three person capacity, the FX and DX variations offer a less expensive option for essentially the same vehicle. Offerings in the traditional Mule 4000 and 4010 work utility vehicle lineup remain essentially the same, although a couple of special edition models were added.

In the recreational Teryx and Teryx4 product lines the 2016 models offer a mix of changes in performance, styling and ergonomics. Performance changes include optimized shocks and larger tires for certain models. The front of the vehicle has been restyled and certain models add LED headlights. The vehicle cockpits have been redesigned with tilt steering, new steering wheel, easily adjustable driver’s seat and new dash layout. Kawasaki is the first of the major manufacturers to launch a full complement of 2016 models.

Here is a summary of some of key features of the 2016 models

The Mule Pro FX lineup is a variant of the existing FXT lineup.

Mule Pro-FX Models

Single-row seating allows for larger steel cargo bed with 1,000 lb. capacity
New 3-cylinder 812cc fuel injected engine
2,000 lb. towing capacity
Independent front and rear suspension, disc brakes, CVT
Electric Power Steering for most models
Tilt-steering except non-EPS model
LCD Display
Multiple 12 volt outlets
Pro-FX line includes four models: Base non-EPS, EPS, EPS LE and EPS Camo
EPS model adds EPS and tilt steering
EPS LE further adds LED auxiliary headlights, aluminum wheels and a composite sun top
EPS Camo adds EPS, tilt steering, LED auxiliary headlights and Realtree Xtra Green Camo color scheme
MSRPS: Mule Pro-FX, $11,999; Mule Pro-FX EPS Camo, $14,199; Mule Pro-FX EPS, $12,999; Mule Pro-FX EPS LE, $14,199

The Mule Pro DX, a variant of the existing diesel powered DXT lineup is also new for 2016.

Mule Pro-DX Models

New three-cylinder 993cc diesel engine
55-amp alternator
Cargo bed with 1,000 lb. capacity and fits standard pallets
2,000 lb. towing capacity
Independent front and rear suspension, disc brakes, CVT
Electric Power Steering for most models
Tilt Steering
LCD Display
Multiple 12V outlets
Pro-DX line includes three models: Base non-EPS, EPS, and EPS LE
EPS model adds electronic power steering and Timberline Green color option
EPS LE further adds LED auxiliary headlights, a composite sun top and Dark Royal Red color option
MSRPs: Mule Pro-DX $13,199; Mule Pro-DX EPS, $13,999; Pro-DX EPS LE, $14,899

The Mule 4000 and 4010, (shown here) models have minor changes for 2016.

Mule 4010 & Mule 4000 Models

These models are similar to the 2015 models with the exception of the special edition 4010 4×4 SE and 4010 Trans4x4 SE which feature LED headlights and a composite sun top.
Depending on the model available colors include Timberline Green, Dark Royal Red, Realtree Xtra Green Camo and Super Black
Trans models allow for re-configuration of the seating and cargo area to carry 2 people and 800 lbs. of cargo or 4 people and 400 lbs. of cargo.
MSRP: Mule 4000, $8,999; Mule 4010 4X4 SE, $10,549, Mule 4010 4X4, $10,199; Mule 4010 TRANS4X4 SE, $11,999; Mule 4010 TRANS4X4, $11,199 ($11,699 Camo model)

The new 2016 Teryx with redesigned front.

This earlier version of the Teryx shows the design differences in the front of the vehicle.

Teryx Models

A number of new features have been introduced for the 2016 models
New redesigned front face
New dashboard layout
Tilt steering is standard along with thicker and sportier steering wheel
Electronic Power Steering on all models
New tool-free adjustment for driver’s seat
New optimized setting for the Fox Podium 2.0 shocks
Bigger 14″ wheels on the Teryx LE
Four LED headlights on LE and Camo models
Standard hard top on LE and Camo models
Available in three models: EPS in Bright White; LE with 14″ aluminum wheels, LED headlights, hard top and choice of Candy Lime Green or Metallic Flat Raw Graystone paint; Camo with LED headlights, hard top and Realtree XtraGreen Camo
783 V-twin engine remains the same
MSRPs: Teryx EPS, $12,999; Teryx Camo, $14,299; Teryx EPS LE, $14,999

The new 2016 Kawasaki Teryx4 Camo.

Teryx4 Models

Key features of the 2016 Teryx4 lineup include:

New redesigned front face
New dashboard layout
Tilt steering is standard along with thicker and sportier steering wheel
Electronic Power Steering on all models
New tool-free adjustment for driver’s seat
New optimized setting for the Fox Podium 2.0 shocks
Bigger 14″ wheels on the Teryx4 LE
Four LED headlights on LE and Camo models
Versatile cargo bed and large storage area behind front seats
Standard hard top on LE and Camo models
Available in three models: EPS in Bright White; LE with 14″ aluminum wheels, LED headlights, hard top and choice of Candy Lime Green, Metallic Flat Raw Graystone or Candy Persimmon Red paint; Camo with LED headlights, hard top and Realtree XtraGreen Camo
783 V-twin engine remains the same
MSRPs: Teryx4 EPS, $15,799; Teryx4 Camo, $16,299; Teryx4 EPS LE, $16,999

Learn more: Kawasaki.com

Arctic Cat Quarterly Earnings & Analysis

Posted on May 21, 2015 by Marc Cesare

The 2015 Wildcat Sport XT, a recent addition to the Arctic Cat side-by-side lineup.

The 2015 Wildcat Sport XT, a more recent addition to the Arctic Cat side-by-side lineup which is a bright spot among Arctic Cat’s business segments.

Arctic Cat recently released their financial results for the fiscal fourth quarter ended March 31, 2015. Management reported a net loss of $21.5 million on net sales of $98.9 million for the fiscal 2015 fourth quarter. In the prior-year quarter, Arctic Cat reported a net loss of $1.6 million on net sales of $145.4 million. Full-year net sales were down approximately 4% to $698.8 million from $730.5 million in fiscal 2014. Net earnings decreased to $4.9 million. Full-year net sales include an unfavorable foreign currency impact that reduced net sales by approximately $18.1 million.

Highlights of the earnings call related to the utility vehicle market include:

ATV sales (includes ATVs and UTVs) for the year decreased 15% to $284.1 million from $333.2 million in the prior fiscal year.
Strong sales of Wildcat side-by-side models were offset by lower sales of core ATVs to North American dealers and in international regions, including Russia, as the company reduced bloated dealer inventory of core ATVs.
At the retail level ATV and side-by-side sales increased low 20s% for the fourth quarter.
Management reported gaining market share in the side-by-side segment
Management announced $27 million of investment in US manufacturing facilities and is investigating establishing a facility in a lower-cost region of the world
In the fourth quarter Arctic Cat began shipping UTVs to Toro under their OEM agreement
Arctic Cat ATV sales are expected to increase 9-12% at the wholesale level for the coming fiscal year, primarily from Wildcat sales. Retail sales are expected to be in the 15-20% range.
Dealer feedback on the newest Wildcat Trail models has been positive as well as the new 2016 Prowler HDX announced in Febuary

Learn more: Seekingalpha.com (earnings call transcript)

Analysis: The new CEO Christopher Metz is moving aggressively to improve the company. One of his first moves was to take a significant write down related to excess ATV inventory. He appears to be moving more quickly to clean up inventory in the ATV as well as other business segments than his predecessor. He also created a new position, Chief Marketing Officer and added a new NA sales executive. In addition they are investing $27 million in improving manufacturing facilities.

While there will be some new products in 2016, with launches in August, the year will be dedicated more to cleaning up inventory and laying the foundation for a more efficient and productive company. Fiscal year 2017 will feature a more robust slate of product introductions. Despite some difficulties overall for the company, Arctic Cat’s side-by-side business continues to be a growth area. Expect the company to continue to aggressively buildout their product offerings in this area, targeting both the recreational sub-segments with new Wildcat vehicles and trying to expand into more areas of the work/utility segment under the Prowler product line.

Polaris Chooses Design & Construction Firms For Huntsville Plant

Posted on May 13, 2015 by Marc Cesare

Rendering of the new Polaris facility in Huntsville, AL

Polaris Industries has chosen two Nashville, TN firms for the design and construction of their new manufacturing plant in Huntsville, AL. T.W. Frierson Contractor, Inc. and the architectural firm Design Constructors, Inc. were chosen for the $48 million, 775,000-square-foot plant that is scheduled to be operational within a year. The production facility is the first for Polaris in the southern half of the United States, and will initially be producing the Ranger side-by-side utility vehicles including vehicle assembly, chassis and body painting, welding, fabrication and injection molding. Learn more: Madisoncountyrecord.com

Polaris Reports Record First Quarter 2015 Results

Posted on April 23, 2015 by Marc Cesare

Polaris yet again reported record quarterly results with first quarter 2015 sales reaching $1,033.3 million, up 16% compared to the previous year. Operating income increased 19% to $150.3 million during the 2015 first quarter. Currencies in the 2015 first quarter had a $32 million negative impact on total company sales versus Q1 of last year. Here are some of the highlights related to the STOV market. Comparisons are between first quarter 2015 to first quarter 2014, unless otherwise stated. The highlights have been updated following the earnings conference call with analysts.

Off-Road Vehicle (ORV) sales, which includes UTVs and ATVs increased 11% to $645.4 million.
ORV inventory increased primarily in the ATV segment.
Polaris North American ORV unit retail sales were up mid-single digits percent, with consumer purchases of Rangers and RZRs each increasing from the first quarter last year.
RZR sales are stronger than Ranger sales but the latter grew “nicely”.
North American ATV retail sales decreased low-single digits percent due to heavy competitive promotional spending during the 2015 first quarter with ACE up significantly.
Management reports a “fair amount” of wholesale discounting by competitors but this is not expected to continue. Promotional activity is more pronounced for ATVs but is occurring for side-by-sides as well.
Management sees the Hammerhead brand acquisition as a good way to attack the value end of the UTV market.
North American industry ORV retail sales in the first quarter 2015 increased an estimated mid-single digits percent according to management.
Sales of Polaris ORVs outside of North America decreased 10% primarily due to weak economic conditions in the Europe, Middle East and Africa (EMEA) region, as well as the currency impact of a strengthening U.S. dollar.
ORV industry in EMEA region grew mid-single digits in terms of volume but was driven by smaller value products and discounting.
Average sales per ORV unit increased 7% in the quarter.
The Eicher-Polaris JV will begin shipping the new utility vehicle in Q3.
Global Adjacent Markets, which includes GEM, Aixam, Goupil as well as government and military sales, increased 7% to $65.4 million.
Government/military group experienced double digit percent sales growth during the 2015 first quarter.
Work and Transportation (W&T) group sales (part of Global Adjacent Markets) increased mid-single digits percent with North American W&T sales increasing double digits percent while W&T outside North America declined partly resulting from lower Aixam sales in EMEA due to the impact of negative currencies.
North American W&T was up over 30% on strong partnership shipments, national account growth and 40% GEM retail increase.
Brutus retail increased low double digits in volume but revenue was hurt by promotions and the loss of some dealers. The PTO and high end models are performing well but base models are underperforming.
Goupil and Aixam increased shipments and future orders are up 20% but currency headwinds remain a drag.
Aixam made market share gains in a flat industry performance.
Defense revenue grew double digits on strength of M RZR in international markets and DAGOR shipments to special forces.

Guidance for the Year

Global adjacent market sales are now expected to grow 5% to 10% and total international sales are now expected to decline low single digits percent.
ORV’s are expected to increase mid-single digits percent after growing 11% in the first quarter benefiting from a 7% increase in the average sales per ORV unit.
Currency changes are expected reduce full year 2015 revenue by $140-160 million.

Learn more: Seekingalpha.com (Earnings call transcript)

Mahindra USA Partners with Intimidator to Offer UTV

Posted on April 21, 2015 by Marc Cesare

The Mahindra mPact XTV 1000 L utility vehicle is one of six models developed by the company in partnership with Intimidator, Inc.

From Mahindra USA:

Mahindra USA announced Monday it is teaming up with Intimidator Inc. to manufacturer an all-new line of utility vehicles, the Mahindra mPACT™ XTV. The mPACT™ XTV rollout will begin with six models available through Mahindra’s dealer network beginning in early 2015. Mahindra dealers were given a sneak preview of the new utility vehicles at Mahindra’s Regional Dealer Meetings in October.

“Our partnership with Intimidator brings together two companies with shared vision, an innovative approach to product design and a passionate commitment to quality. Mahindra is dedicated to investing in the future through new product development to provide our dealers and customers with products that continue our tradition of delivering the unmatched value they have come to expect from Mahindra,” said Mani Iyer, President, Mahindra USA.

The Mahindra mPACT™ XTV are all designed to provide superior performance and deliver impressive work and transport capabilities. This XTV lineup offers category-leading cargo box and towing capacity. Each model offers spacious, comfortable seating for driver and passengers and is loaded with standard features such as true 4WD, 12-inch ground clearance, power cargo box lift, front and rear receiver hitches – all backed by an industry-leading three-year powertrain and one- year bumper-to-bumper warranty.

The gas and diesel versions will be available in three styles in early 2015:

• Standard: three-passenger with cargo

• Crew: six-passenger with cargo

• Longbed: three-passenger with extra cargo that folds to a flatbed

“We are looking forward to a long-term and productive relationship with Mahindra to bring the mPACT™ XTV’s, that are built with pride from the ground up in Batesville, AR, to its strong and growing North American dealer distribution network. We will boost UTV production significantly in the coming years as we expand the rollout to all markets to meet demand,” said Robert Foster, Owner, Intimidator, Inc.

Intimidator has immediate plans to add 7,600 sq. ft. to its 122,000 sq. ft. headquarters in Batesville, AR, and is working closely with the Independence County Economic Development Board on plans for a major facility expansion in the area’s new industrial park within three years. In addition, the expected demand for the Mahindra mPACT™ XTV’s will add 150 new jobs at the Intimidator manufacturing facility, which currently employs more than 50 people, as production is ramped up to meet this demand.

“The Mahindra mPACT™ XTV stole the show at our North American Regional Dealer meetings in October as our dealers responded with overwhelming support for this new product line. Pre-orders at the Regional Dealer Meetings exceeded our expectations and we are looking forward to getting these top-of-the-line utility vehicles in the hands of our customers in 2015,” said Cleo Franklin, Mahindra USA’s Vice President of Marketing and Strategic Planning. “The utility vehicle segment is a natural extension to our growing line of tractors and will add fuel to Mahindra’s rapid growth in North America.”

The new Mahindra XTV’s will begin to roll out in early 2015 to select markets and expand through the United States and Canada through the remainder of the year. For more details and weekly updates on the Mahindra mPACT™ XTV series, visit mahindraxtv.com.

Intimidator, Inc. is owned by Robert and Becky Foster, former co-owners of Bad Boy Mowers. Intimidator offers world-class American-made, side-by-side 4×4 Utility Vehicles with unparalleled strength, power and performance at an affordable price. The company’s expanding line of products includes the Intimidator Classic, Intimidator Crew Cab, and Intimidator Truck series utility vehicles built to suit a variety of needs—from hauling feed to hunting and more. Three engines choices are currently offered: 1,000cc Diesel, 750cc Gasoline, and a 48volt Electric.

Headquartered in Batesville, Arkansas, the family owned company has more than 50 employees. Intimidator products are sold through a growing network of more than 65 dealers in the United States. Intimidator and its sister companies, Bad Dawg Accessories and Ground Hog Maxx, provide the best aftermarket selection of accessory items the side-by-side market has to offer. Bad Dawg products are distributed through Bass Pro Shops, Cabela’s, and Tractor Supply stores nationwide. For UTV accessory information, visit Bad Dawg Accessories.com or call (877) 522-3364. For more information on Intimidator, visit IntimidatorUTV.com or call (877) 522-3364.

Learn more: Mahindrausa.com

Comment: The Mahindra and Intimidator partnership is another sign of the robustness and competitiveness of the UTV market. While some companies have exited the market, new companies continue to enter the market. Farm equipment and other manufacturers such as Mahindra are partnering with UTV manufacturers to enter the market. These partnerships allow them to participate in a growing and complementary market without devoting as many resources as they would if they developed the vehicles themselves. In addition, they gain access to the expertise of manufacturers that focus on UTVs as compared to farm equipment in Mahindra’s case.

Yamaha Recalls 2015 Viking VI UTVs

Posted on April 21, 2015 by Marc Cesare

The 2015 Viking VI EPS Hunter from Yamaha is one of the models being recalled.

Yamaha has recalled approximately 3,500 Viking VI utility vehicles because the rear wheels can loosen and cause the rear end of the vehicle to wobble or the rear wheels to come off and cause the vehicle to crash. The recall involves the 2015 Viking VI, Viking VI Hunter, Viking VI EPS and Viking VI EPS Hunter.

The following information is from the Consumer Product Safety Commission.

Name of product: Yamaha Viking VI

Hazard: The rear wheels can loosen and cause the rear end of the vehicle to wobble or the rear wheels to come off and cause the vehicle to crash, resulting an injury or death hazard.

Recall Details

Units: About 3,500

Description: This recall involves 2015 model YXC700DF (Viking VI), YXC700DHFH (Viking VI Hunter), YXC700PF (Viking VI EPS) and YXC700PHFH (Viking VI EPS Hunter) side x side vehicles. Model numbers can be found on the owner’s manual. The letter F in the 10th position of the Vehicle Identification Number (VIN) indicates that the vehicle is 2015 model. The VIN is stamped on the frame behind the left rear wheel. The “Viking VI” model name is printed on the left side of the front hood. The vehicles come in Realtree (multicolor), hunter green, red and steel blue.

Incidents/Injuries: No reported injuries

Remedy: Consumers should immediately stop using the vehicles and contact their local Yamaha dealer to schedule a free repair. Yamaha is contacting all registered owners directly.

Sold exclusively at: Yamaha side x side dealerships nationwide from June 2014 through March 2015 for $12,800 to $14,600.

Manufacturer(s): Yamaha Motor Corporation, of Cypress, Calif.

Manufactured in: USA

Consumer Contact: Yamaha at (800) 962-7926 anytime or go to www.yamaha-motor.com, click on “Outdoors” tab, and then click on “Recalls” in the Corporate Links menus.

Learn more: CPSC.gov

Comment: This is a fairly large sized UTV recall and appears to be a significant issue with the vehicle. The recall is a setback for Yamaha given that the Viking VI has not been on the market that long and is an important part of the company’s renewed push in the UTV market after several years of minimal product development.

Yamaha’s Wolverine R-Spec UTV Shipping To Dealers

Posted on April 16, 2015 by Marc Cesare

The new Yamaha Wolverine R-Spec UTV hitting dealer showrooms this month.

Yamaha’s new UTV, the Wolverine R-Spec, is coming off the production line in Georgia and will be available at dealers this month. The Wolverine R-Spec is targeting hunters and off-road recreation users. Key features of the vehicle include:

708cc EFI engine
2WD, 4WD, locked 4WD Drive Train
Yamaha Ultramatic V-Belt transmission with all-wheel engine braking
26″ tires and steel wheels
Hydraulic disc brakes
Independent double wishbone suspension front and rear with 9.7″ and 10.6″ of travel respectively
Ultra-long-stroke KYB nitrogen gas charged piggyback shocks
11.4″ of ground clearance
300 lb. cargo bed capacity
1,500 lb. towing capacity
Sun hard top
Electronic power steering (EPS) versions

The models are currently available in Hunter Green and Steel Blue with a RealTree Xtra Camo version available in May/June. MSRP for non-EPS models starts at $12,199 and for EPS models starts at $13,199. Learn more: Powersportsbusiness.com

Comment: After several years of minimal UTV product development Yamaha has come back in a big way the last few years. First with their Viking lineup of UTVs targeting work and crossover recreation use in the 2014 model year and further expanded for model year 2015, and now with the new Wolverine series targeting purely recreational use. I would expect Yamaha to expand the Wolverine lineup with a 4-person version and more sportier models. Although the latter might be handled by another product line launch specifically targeting high performance/sport recreational use.

Cub Cadet Expands UTV Lineup With Challenger Series

Posted on April 16, 2015 by Marc Cesare

A new UTV from Cub Cadet’s new Challenger series.

Cub Cadet is expanding their utility vehicle lineup with a pair of new models, the Challenger 500 and Challenger 700, which launch their new Challenger series of UTVs. The 500 is powered by a 471cc EFI engine and the 700 by a 686cc EFI engine. Other key features for both models include:

350 lb. cargo box capacity
1,200 lb. towing capacity
Four-wheel drive with a front locking differential
Four-wheel independent, adjustable suspension
Four-wheel disc brakes
Large-capacity, mid-mount air intake
Hard-top roof
Quick-release windshield
Alloy wheels
Front-mount winch
26-inch off-road tires
Digital display
2 person capacity

The specs for the Challenger 700 show a top speed of 45 mph and 11″ of ground clearance. Similar specs are not available on the Cub Cadet website for the 500. The MSRPs for the Challenger 500 and 7000 are $8,499.99 and $9,499.99 respectively. Both models will be at Cub Cadet dealers in May and are available in yellow or camo. A four person version will be available later in the summer. Learn more: agriculture.com

Comment: This launch is another sign of the intense competition in the UTV market. Not only are more well known powersports brands launching new vehicles and new product lines but smaller volume brands as well. If they want to stay relevant in the market they must, given the fast pace of product development and innovation for UTVs. With the nice set of desirable features and price points, these vehicles are clearly targeting the value segment of the market. Kymco and CFMoto have found some success in this price range, which is several thousand dollars less than many offerings from more well known UTV brands. Being an American brand with some history may give Cub Cadet an edge against the foreign competitors in this space.

BRP Q4 FY15 Earnings Call & Analyst Day

Posted on April 10, 2015 by Marc Cesare

The Can Am Maverick Xds Turbo was introduced in 2015.

BRP, manufacturer of Can-Am branded off-road vehicles recently announced their financial results for the fourth quarter of fiscal year 2015, and also made a presentation to industry analysts. The following is a summary of some of the key points from the earnings call and analyst presentation, mostly related to the utility vehicle market. (all $ figures in Canadian dollars)

For the year total company revenues were up 10% to $3.5 billion and net income increased to $70.1million from $59.7 million.
For the year, Year Round Products revenue, which includes ATVs, UTVs and the Can Am Spyder, increased to $1.3 billion from $1.2 billion.
Gross Profit Margins decreased by 1% to 24% because of currency issues.
In the Q4 2015, which ended January 31, Year Round Products increased 53% year over year to $416.0 million from $272.5 million. The large increase is attributed to continued growth, dealer shipments for new product introductions for ATVs, UTVs and the Spyder and a new dealer ordering system that shifted some shipments from Q3 to Q4.
The Maverick Xds and Xds Turbo were introduced but slightly behind the optimum schedule.
Management reports that North American industry side-by-side sales are up mid-teens percent for the season starting in June while the ATV industry remains flat.
Can-Am side-by-side sales were up mid-single digits. While Can AmMaverick and Commander maintained market share in their respective sport and recreation focused market segments, BRP’s lack of product in the more utility oriented segments puts their sales growth behind the overall industry pace.
New product introductions increased inventory for UTVs and ATVs slightly.
Promotional activity for the UTV market is reported to be normal.
UTV OEMs continue to collaborate through the ROHVA association in discussions with the CPSC regarding new UTV regulations.
BRP continues to expand their NA dealer network. They added 38 dealers in FY14 and 76 in FY15. Of the latter 76, 72 are carrying off-road vehicles and 31 are located in the South or Southwest. Dealer network coverage for ORV and Spyder has increased by 10%. The management is targeting 200 to 300 new dealers in total by the end of FY17.
Management is focusing not only on increasing the number of dealers but improving the quality with better showrooms, as well as increasing the number of BRP product lines that existing dealers are carrying.
Ramp up time for new dealers is averaging about 12 months, which is slower than expected but management appears satisfied with the quality of the dealers and is taking a long-term approach.
The company is continuing to invest in and shift manufacturing operations with an emphasis on their facilities in Mexico, which have lower production costs, are closer to ORV and water products market and a offer a good location for international shipping.
Their Queretaro facility in Mexico will build engines for ORVs and other products. BRP is investing $55 million in their Juarez II facility in Mexico which will handle new ORV growth and brings chassis painting in-house. The facility is expected to have enough capacity for their growth plans through at least FY2020.
Capital expenditures will increase significantly from $175 million in FY2015 to $200-220 million in FY2016.
Guidance for Year Round Products for FY2016 is an increase in revenues of 7%-11%.

ORV Related Growth Areas

Management is targeting the utility segment of the UTV market as a growth area and the biggest opportunity in the Year Round Products division.
Overseas, China represents a sizable off-road opportunity and BRP plans to increase the number of dealerships from 19 to 30 by the end of FY16.
Another growth area related to ORVs that is being targeted is in Parts, Accessories and Clothing which has grown at a CAGR of 12% over the last five years.

Comment: While not explicitly stated by the management, expect BRP to introduce new UTVs this year targeting the utility/work market segment. The challenge for the powersports UTV manufacturers is reaching the utility/work customers with their existing dealer networks. Some portions of this market segment is often reached by non-powersports distribution channels and involve different selling processes at which powersports dealers may not excel or be interested in pursuing. Nevertheless, the continued entry into other UTV segments by various powersports manufacturers as well as the expansion of dealer networks should help drive growth in the NA UTV market. Overseas, there are some currency and macro economic headwinds but BRP and other OEMs appear to be committed to the long term development of the ORV market.

Small Vehicle Resource Blog

Information on the small, task-oriented vehicle market

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