Everyone knows that UTVs and side-by-sides have converted many buyers that would’ve purchased ATVs ten years ago, but there is another competitive force that is rivaling UTVs in significance. What began as a southern tradition has now gone nationwide. Used golf cars, or what I characterize as Lifted Golf Cars, are taking share from the ATV market — significant share. Technically a golf “car” is something your drive while a golf “cart” is pulled by hand, but today both terms are used to describe the motorized versions. Before the great recession, American manufacturers E-Z-GO and Club Car were building 100,000+ golf cars per year for golf course fleets and most of these machines are now in private ownership with more added each year. Many hunters run 4-wheel drive electric golf carts because of the quiet operation. Weekend travelers heading for their lake cottages are now as likely to have a golf car on their trailer as an ATV, although out of necessity real trail riders still run RZRs and quads.
According to the Gold Management Association, golf courses trade off their fleets, an average of 60 or so, to distributors every few years. The units are clean and well-cared for. The stock speed of 15mph is fast enough for many baby boomers, and performance kits are available. Golf cars carry multiple passengers easily. They lend themselves to joyriding with kids, private-land hunting, camping and light-duty hauling. People love to customize golf cars just as they love to customize UTVs, and the options are just as endless. Dealer magazines are bursting with full-page ads for seats, tires, cabs, graphics, plows and four wheel drive components. One aftermarket golf parts distributor recently told me that their revenue was up 135 percent from 2013 to 2014. The growing dealer base is starting to drive margins down, but they are still quite high compared to the commoditized ATV market. Thousands of dollars of profit can be generated from the sale of a Lifted Golf Car and the golf car lists at around half the retail price of a well-equipped UTV — which is why they sometimes compete head-on with ATVs, not just UTVs, for certain customers. I’ve polled dozens of golf car dealers and the higher-volume ones tell me that it is not uncommon to double their money on a unit once they purchase a semi-load from a distributor and add accessories. Think about that — a very high ROI with an inventory turn as short as two months. Of course results will vary. Increased demand has raised the price of cars coming into private use from fleet customers, but there is still plenty of meat on the bone.
The Off-Road Vehicle and golf car sales channels have very little overlap. A few attempts have been made to beef up golf cars to sell as UTVs, but the penetration rate with powersports dealers is miniscule. Likewise the biggest powersports distributors are small players in golf, if they are in it at all. Overall there are completely different aftermarket golf distributors like Stenten’s, different dealers, different suppliers like Rhox and different OEMs. There are completely different media channels and trade shows, for example the annual PGA show. Yet the stories all of these enterprises have to tell are just as compelling and original as any powersports brand. People that love to golf have an emotional connection to the units and they have reasonable expectations for how they will perform. They are not capable trail-riding steeds, but offer plenty of value for a private land owner who does his or her riding in a well-defined box. It’s no wonder that the Lifted Golf Car market is hot, but it is remarkable how little attention this segment gets from powersports businesses. Golf car dealers are already playing in your sandbox, you just don’t know it. This is probably the most overlooked disruptive force in the 4-wheeler industry today.
Powersports industry analyst Gary Gustafson connects world-class suppliers with OEMs, and develops innovative market research and product launches for ATV, UTV, Motorcycle and Snowmobile brands. Learn more at www.gforceconsulting.com.