In the past few weeks a number of publicly traded STOV manufacturers have reported earnings. While the economic downturn has significantly impacted the market, both Polaris and Arctic Cat report gaining market share in ATVs and UTVs during this time. Both companies have also embarked on programs to develop more frequent dealer ordering cycles to reduce dealer inventories and better react to market demands by creating a more desirable model mix at the retail point of sale.
Arctic Cat reported that through the first half of the year the ATV sales declined 20% but in the side by side market some segments have actually shown growth. Artic Cat reports gaining market share in both the ATV and UTV markets.
Polaris reported in their earnings call with analysts that the ATV market was down more than 15% while the side by side market was making some gains. Management expects the economic recovery to be choppy. Polaris reports taking market share in the ATV and UTV markets while Honda and Yamaha are struggling. The LSV market has been smaller than expected in the short term, but management expects it to be a growing niche market that they are taking the time to learn before developing growth strategies.
Polaris is also starting to roll out vehicles for their partnership with Bobcat. The initial dealer reception to the vehicles has been positive. An offshoot of that development program was the addition of diesel powered vehicles in the Polaris line-up targeting work customers in North America and global markets as well as the military market where diesel is the fuel of choice. Yanmar is providing Polaris with diesel engines. The electric Ranger LSV serves the military market as well. During the call management also noted that some production had been moved to Mexico since much of their growth in the US is occurring in the southern part of the country.