Issue link: https://read.dmtmag.com/i/536070
FOCUS PSB UTV — Sport 20 • July 13, 2015 • Powersports Business www.PowersportsBusiness.com CDK Global Recreation data shows sport UTV buyers are willing to spend more on payment for longer terms BY HAL ETHINGTON CONTRIBUTING WRITER Editor's note: The following UTV study comes from the data team at CDK Global Recreation, headed by 40-year industry veteran Hal Ething- ton. The data is the first of its kind presented to the industry, courtesy of CDK Global Recreation. This study is focused on retail financing pat- terns found in the UTV market. Sales for just under 88,000 units from January 2011 through April 2015 were found in three categories: 51,300 Multi-Purpose 31,900 Sport 4,700 Work The elements studied were: Total Price Amount Financed Average Monthly Payment Term of the Contract FINDINGS: The amount financed for multi-purpose (MP) machines was generally just under 100 percent of unit + accessories. The same was true for sport models, but the amount financed for work machines was consistently above 100 percent of unit + accessories. It measured 101 percent in 2011 and a high of 104 percent in 2012. See Charts A1, B1 and C1. For MP units, the amount financed stayed steady, but the average payment amount decreased between 2012 and 2015, as the aver- age term rose from 56 months to 60 months. This appears to be a clear effort to sell the same amount of merchandise, but offer a lower monthly payment by simply increasing the term. See Charts A1 and A2. For sport units, the amount financed rose by 28 percent during the course of this study from $13,680 in 2012 to $17,530 in 2015. This increase was paid for by both an increase in the payment amount (from $298 to $345, up 16 percent), and an increase in the term (from 56 months to 63 months, an increase of 12 per- cent). See Charts B1 and B2. Buyers of work units consistently financed more than the sum of the unit and accessories. Items accounting for this dif- ference could be service contracts, install charges and insurance which have not been included in this study. The average purchase price has steadily climbed from $9,490 in 2012 to $10,790 in 2015, up 13 percent. This increase in amount purchased has been paid with an increase in the payment amount (from $199 to $227, up 14 percent) and an increase in the term (56 months in 2012, up to 58 months in 2015). See Charts C1 and C2 on Page 26.. Looking at the three market segments for UTV, it becomes apparent that there has been a tai- lored approach to financing for each of the dis- tinct customer types. They are: Multi-purpose The largest of the three categories (in this study) at 51,300 units, the purchase amount per unit for this segment has remained rela- tively steady since 2013 (up just 2 percent), but Sport UTV buyers: Paying more, paying longer See CDK Global, Page 26 !"#$%&'( $11,870 $12,380 $12,670 $12,720 $12,740 $11,710 $12,200 $12,430 $12,570 $12,660 $252 $254 $256 $258 $260 $262 $264 $266 $11,000 $11,200 $11,400 $11,600 $11,800 $12,000 $12,200 $12,400 $12,600 $12,800 $13,000 2011 2012 2013 2014 2015 Payment Amount (Unit + Accy) and Amt Financed Avg Unit + Accy Avg Amt Financed Avg Monthly Pymt !"#$%&'( $258 $264 $262 $258 $257 55 56 57 59 60 52 53 54 55 56 57 58 59 60 61 $252 $254 $256 $258 $260 $262 $264 $266 2011 2012 2013 2014 2015 Term in Months Monthly Payment Avg Monthly Pymt Avg Term in Months !"#$%&'( $13,280 $13,970 $15,440 $16,900 $17,880 $13,260 $13,680 $15,050 $16,480 $17,530 $270 $280 $290 $300 $310 $320 $330 $340 $350 $0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 $20,000 2011 2012 2013 2014 2015 Paymnet Amount (Unit + Accy) and Amt Financed Unit + Accy Avg Amt Financed Avg Monthly Pymt !"#$%&'( $296 $298 $315 $333 $345 55 56 58 61 63 50 52 54 56 58 60 62 64 $270 $280 $290 $300 $310 $320 $330 $340 $350 2011 2012 2013 2014 2015 Term in Months Monthly Paymnet Avg Monthly Pymt Avg Term in Months MULTI-PURPOSE UTV | 51,300 NEW UNITS SOLD 2011-15 WITH FINANCING TOTAL OF UNIT + ACCESSORIES V. AMOUNT FINANCED MULTI-PURPOSE UTV | 51,300 NEW UNITS SOLD 2011-15 WITH FINANCING AVERAGE MONTHLY PAYMENT AND AVERAGE TERM (IN MONTHS) SPORT UTV | 31,900 NEW UNITS SOLD 2011-15 WITH FINANCING TOTAL OF UNIT + ACCESSORIES V. AMOUNT FINANCED SPORT UTV | 31,900 NEW UNITS SOLD 2011-15 WITH FINANCING AVERAGE MONTHLY PAYMENT AND AVERAGE TERM (IN MONTHS) Source: CDK Global Recreation Chart A1 Chart A2 Chart B1 Chart B2