Issue link: https://read.dmtmag.com/i/360137
4 • August 11, 2014 • Powersports Business NEWS www.PowersportsBusiness.com www.powersportsbusiness.com Editorial and Sales: 763.383.4400 Subscriber Service: 847.763.9565 EDITOR IN CHIEF: Dave McMahon 763/383-4411 (dmcmahon@powersportsbusiness.com) MANAGING EDITOR: Liz Keener 763/383-4413 (lkeener@powersportsbusiness.com) DIGITAL SOLUTIONS MANAGER: Christopher Gerber DIGITAL PRODUCTION EDITOR: Heather Brown SENIOR ART DIRECTOR: Dodi Vessels ASSOCIATE ART DIRECTOR: Andrea Schneider PRODUCTION MANAGER: Angela Schmieg PRODUCTION DIRECTOR: Cherri Perschmann NATIONAL SALES DIRECTOR Allison Gruhn 763/383-4467 (agruhn@powersportsbusiness.com) NATIONAL ACCOUNT MANAGER Mark Rosacker 763/383-4433 (mrosacker@snowgoer.com) NATIONAL ACCOUNT MANAGER David J. Voll 763/383-4421 (dvoll@ridermagazine.com) ADVERTISING SALES REPRESENTATIVE: Barbara Reynolds 603/588-2086 (breynolds@powersportsbusiness.com) CEO: Marion Minor SR. VICE PRESIDENT/FINANCE & OPERATIONS: Gerald Winkel SR. VICE PRESIDENT/MARKET DEVELOPMENT: Joanne Juda-Prainito VICE PRESIDENT/POWERSPORTS, MARINE, BEVERAGE: Amy Collins AUDIENCE DEVELOPMENT MANAGER: Tim Morgan MARKETING SPECIALIST: Geoff Christ SENIOR SALES ADMINISTRATOR: Bernadette Wohlman CONTRIBUTORS: COLUMNISTS: Steve Dodds, Brian Gallmeier, Hal Ethington, Neil Pascale, Sam Dantzler DEALER ADVISORY BOARD: Hooksett Kawasaki-Polaris, Jim Whalley; Hacker's Yamaha & Honda, Rick Hacker; Honda/Polaris of Lubbock, Morris Baker; All Action Water Sports, Ray Leps POWERSPORTS BUSINESS (ISSN #1522-7944) is published 15 times per year – monthly except twice in May and December, the Market Data Book in September – by EPG Media, LLC, 3300 Fernbrook Lane N #200, Plymouth, MN 55447. Periodicals postage paid at St. Paul, MN and additional mailing offices. SUBSCRIPTION INFORMATION: Free to qualified members of the motorcycle, all-terrain vehicle, snowmobile and personal watercraft industries. Annual subscription rate is $56 per year for U.S residents, $76 for Canadian residents and $96 for residents in other countries. All paid subscriptions must be paid in advance and in U.S. funds only. POSTMASTER: Send address changes to Powersports Business, P.O. Box 2123, Skokie, IL 60076-7823. CUSTOMER SERVICE: Visit www.PowersportsBusiness.com, email PowersportsBusiness@halldata.com, call (847) 763-9565, fax (847) 763-9569 or write to Powersports Business, PO Box 2123, Skokie, IL 60076-7823. CANADIAN RETURN ADDRESS: EPG Media, LLC, 4960-2 Walker Road, Windsor, Ontario N9A 6J3. Publication Sales Agreement #40012332. EDITORIAL: All manuscripts, materials, photographs and artwork submitted are at mailer's risk and must include self-addressed envelope with sufficient postage for return. Send editorial materials to EPG Media, LLC, 3300 Fernbrook Lane N, Suite 200, Minneapolis, MN 55447, 763/383-4400. No responsibility will be assumed for unsolicited materials. Powersports Business is a registered trademark of EPG Media, LLC. Copyright 2014 by EPG Media, LLC. All rights reserved. Reproduction in whole or part is prohibited unless expressly authorized by publisher. REPRINTS: For more information on e-prints or reprints from Powersports Business, contact Bernadette Wohlman, 763/383-4400 x2464. Printed in U.S.A. PSB / RBC CAPITAL MARKETS Q2 DEALER SURVEY RATE THE FOLLOWING WHERE APPLICABLE, WHAT TYPE OF GROWTH ARE YOU EXPECTING BY LINE OF BUSINESS (NEW PRODUCTS ONLY, MEASURED IN UNITS) OVER THE NEXT 12 MONTHS? HOW WOULD YOU CHARACTERIZE YOUR CURRENT INVENTORY LEVELS BY LINE OF BUSINESS? 4% 5% 7% 4% 11% 4% 34% 32% 31% 23% 38% 33% 31% 25% 34% 41% 36% 34% 28% 29% 23% 30% 13% 22% 3% 9% 5% 2% 2% 7% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Overall Business Conditions New Unit Sales Used Unit Sales P&A Sales Service Department F&I Very strong Somewhat strong Average Somewhat weak Very weak 27% 25% 55% 40% 28% 35% 26% 29% 55% 62% 40% 58% 67% 59% 54% 58% 18% 13% 5% 2% 5% 6% 20% 13% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Side-by-sides ATVs Heavyweight Motorcycles Sport Bikes Off-road bikes Scooters PWC Snowmobiles Too heavy About right Too low 5% 2% 1% 3% 2% 5% 3% 3% 1% 4% 3% 8% 7% 20% 7% 8% 3% 7% 6% 23% 11% 29% 17% 21% 17% 13% 8% 15% 13% 29% 43% 26% 28% 30% 34% 20% 51% 5% 13% 9% 16% 15% 17% 15% 5% 5% 7% 17% 15% 17% 10% 3% 11% 1% 5% 12% 10% 7% 8% 13% 1% 3% 4% 9% 7% 14% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Side-by-Sides ATVs Heavyweight Motorcycles Sport bikes Off-road bikes Scooters PWC Snowmobiles +30% or better +20% +10% +5% Flat -5% -10% -20% -30% or worse 3% 3% 7% 2% 5% 3% 1% 3% 8% 4% 27% 13% 13% 6% 9% 7% 15% 30% 34% 29% 25% 26% 22% 14% 20% 28% 22% 42% 36% 37% 35% 44% 26% 20% 3% 9% 8% 9% 14% 7% 8% 9% 2% 1% 5% 8% 9% 8% 10% 9% 1% 5% 6% 5% 6% 10% 2% 3% 3% 5% 5% 11% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Side-by-Sides ATVs Heavyweight Motorcycles Sport bikes Off-road bikes Scooters PWC Snowmobiles +30% or better +20% +10% +5% Flat -5% -10% -20% -30% or worse HOW WOULD YOU CHARACTERIZE CUSTOMER TRAFFIC IN THE LAST THREE MONTHS COMPARED TO THE SAME PERIOD LAST YEAR? HOW WOULD YOU CHARACTERIZE YOUR DEALERSHIP'S PROFIT MARGINS NOW VS. A YEAR AGO? IN GENERAL, TO WHAT EXTENT HAS YOUR BUSINESS OUTLOOK CHANGED COMPARED TO SIX MONTHS AGO? Significantly better 4% Somewhat better 29% About the same 36% Somewhat worse 25% Significantly worse 6% Significantly better 4% Somewhat better 33% About the same 32% Somewhat worse 26% Significantly worse 5% Significantly better 2% Somewhat better 28% About the same 42% Somewhat worse 24% Significantly worse 4% Source: Powersports Business / RBC Capital Markets NTM sales in a number of key categories (SxS, ATVs, motorcycles) moderated. We expect growth to slow, and the survey supports our view that industry growth (and the economy) isn't likely to help much. Innovation becomes even more crucial." Here's a look at Q2 performance by segment: MOTORCYCLES "Survey respondents indicate that 2Q14 heavy- weight motorcycle sales were soft. We believe there was broad expectation that some 'pent- up' demand from poor 1Q14 weather would pop up in 2Q14, but that doesn't appear to have happened. Moreover, NTM sales expectations are flat and a number of dealers expressed concern over motorcycle growth. Inventory concerns stepped up meaningfully this quarter, but promotional activity appears in check. We wonder if promotional activity will need to step up in 2H14." ATVS "Industry ATV 2Q14 sales growth and NTM expectations both look modest, but inven- tories are balanced and promotional activity modest." SNOWMOBILES "2Q14 snowmobile sales were likely aided by the long winter. Inventories are as lean as they have been in over a decade, and as a result, little promotional activity is present." WINNING DEALERS The following dealers who completed the PSB/ RBC Capital Markets Q2 2014 Dealer Survey were randomly selected to win a $100 Best Buy gift card, courtesy of RBC Capital Markets. Joe Belmont, Big #1 Motorsports, Birmingham, AL Bob Kee, Destination Cycle, Kerrville, TX Don Novotny, Motoplex of Norfolk, Omaha, NE Steve Reynolds, Big Moose Harley-Davidson, Portland, ME Dave Vincent, Team Vincent Motorsports, Ayr, Ont. All dealers who complete the survey receive a PDF analysis of the results from RBC Capital Markets and are eligible for the $100 Best Buy gift card. See Survey, Page 6 SURVEY CONTINUED FROM COVER WHERE APPLICABLE, PLEASE PROVIDE YOUR YEAR-OVER-YEAR SALES GROWTH (NEW PRODUCTS ONLY, MEASURED IN UNITS) FOR Q2 (APRIL-JUNE) OF 2014