Fall is the season for corporate strategic planning for many companies.  Planning directives and guidelines have been sent out to the operating divisions by the corporate level executive in charge of strategic planning or corporate development, and division executives are in the process of responding with their respective long-range plans (5-year horizons or longer) and corresponding requests for funding to implement these plans.  What these plans contain and how they are implemented have, of course, important implications for dealer networks.

     Periodically, Small Vehicle Resource, LLC (SVR) develops a strategic business environment analysis for the small, task-oriented vehicle (STOV) industry, involving as key features, a compilation of market trends and a market outlook.  The trend period is 2012-2016 and outlook covers 2017-2021.  Four segments of the industry are given focused treatment in separate chapters of the report: 

     1) Fleet golf cars; 2) Personal transportation vehicles (PTVs); 3) Light duty utility vehicles and transporters (LUTs); and 4) Off-road utility and recreational vehicles.  In addition, chapters on key technology and product developments, international markets, and State regulations for on-road usage comprise the total package. 

Key Industry Transitions

     We at SVR see the STOV industry as an industry in transition:  First, in the extension of traditional markets (albeit through far more diverse company participation), with a host of product improvements and upgrades; second, via the introduction and adaptation of radically new technologies that complement solutions to urban congestion and pollution; and third, growing interest by U.S.-based companies in global markets.

     Thus, the current report is entitled, The Market for Small, Task-Oriented Vehicles in the United States:  An Industry in Transition--Trends 2012-2016 and Forecasts to 2021, and is now available for purchase.  See my contact information below.

  Here are some of the highlights of report:

Market Trends and Outlook

• U.S. economic trends are looking up, although achieving consistent levels of greater sustainable growth in the range of 3.2%-4.1% over the next five years will likely be realized only in the context of a reduction in corporate tax rates and continued policy of regulatory relief;

• Overall trends in STOV markets since 2012 have been favorable, ranging from the mid-to-high single digits for the most part.  Given the favorable prospects for the U.S. economy, which will drive investment and consumer spending, these trends are likely to continue and even gain momentum should the economy begin to move forward at a more accelerated pace. 

• Fleet golf cars, which have experienced a stagnant market for some time, continue in that vein, although the sport of golf and its courses show clear signs of effective consolidation and strength, totally belying the dire narrative that the sport is on its last legs;

• The forecast for the non-fleet, golf car-type vehicle market—PTVs and LUTs—is substantially more aggressive, compared with the fleet market, with possible high single digit to low double-digit growth in the offing;

• From a clear strategic perspective, non-fleet unit market which is about 15% smaller than the fleet market in 2016, is forecast to be 25% larger by 2021;

• The offroad market continues to mature with lower growth than in past periods, but still in the 6%-7% range through 2021.

Potential New Markets and Products

• From a global perspective, the small, task-oriented vehicle market is quite diverse, with certain Asian markets particularly attractive; e.g., China, India, Indonesia, Malaysia, and Vietnam;

• Even Europe, because of its more advanced urban mobility foresight and planning, could be an exciting market for new STOV products;

• Look to growing electrification in Asia as a springboard for U.S.-based manufacturing expertise in drivetrains and assembly of small electric vehicles, with new product and market entrepreneurial efforts getting serious attention in the latter part of the forecast period;

• Three-wheel vehicles, ubiquitous in Asia and Africa, could play a role in the U.S. market for small electric vehicles because of their inherent design latitude with respect to speed and on-road accessibility. 

New Technologies as Defining New Product    

• Potential new markets and products are joined at the hip with the introduction of new technologies and evolving transportation systems;

• Self-driving, artificial intelligence technology adapted to small, task-oriented vehicles should enter the broader commercial market—beyond prototype testing which is occurring now—within two-to-three years;

• Lithium power is another key to new products (enhanced capabilities = new products), with E-Z-GO Textron leading the way with its lithium-powered fleet vehicles and PTVs;

• Emergence of autonomous small vehicles and the advantages of lithium batteries is closely tied to the growing concern for urban congestion and attendant pollution issues—and the on-going strategizing by urban planners to optimize the flow of urban vehicular traffic of all kinds.  Small vehicles could potentially play a major role in finding solutions which alleviate these issues;

• SVR’s analysis and report contains an extensive review of technological advances that could easily impact the STOV marketplace and offer opportunities for company growth with dealer participation.

     This is a brief rundown of some of the highlights of SVR’s report on the small, task-oriented vehicle industry, our eighth such study, dating from the initial publication in 2000.  

For a table of contents view the study brochure (PDF). You can order the newest study or get further detailed information by contacting:

Stephen Metzger, Managing Director, Small Vehicle Resource, LLC

smetzger@smallvehicleresource.com  (914) 293-7577