Polaris Industries made market share gains in two key segments — ATVs and UTVs — during its most recent quarter.
That was part of the good news that surrounded Polaris’ second-quarter earnings report, which showed overall North American retail demand of Polaris’ products up 13 percent.
“Polaris is squarely back on the growth trend,” Polaris Industries CEO Scott Wine said during the company’s earnings report.
The growth trend was seen on several fronts, including:
While North American retail sales grew, Wine noted Polaris remains conservative about continued growth within the U.S. and Canadian markets this year and even into 2011. As a result, the company is spending considerable time and energy growing its international business. A team of Polaris executives, in fact, recently toured China, where Polaris recently opened its first off-road dealership.
“We believe that China, Brazil, India and the other developing countries of the world are going to grow faster than the U.S. well into the future,” Wine said, “and we plan to be there to invest and grow in these markets.”
One positive for North American sales appears to be a stabilized retail lending market.
Polaris Chief Financial Officer Mike Malone reported the percentage of Polaris’ retail customers receiving lending approvals has increased over a year ago and even a quarter ago. The approval percentage through Polaris’ retail lenders — GE Money, HSBC and Sheffield — is at 57 percent, four percentage points higher than a quarter ago and nine percentage points over a year ago.
Malone noted he didn’t see the improved approval percentage a result of significant loosening of lending requirements but “just a matter of returning to more normalcy more than anything else.”
Normalcy also appears to be occurring within Polaris’ dealer networks. Polaris officials said dealer repossessions are stable-to-declining and its North American dealer networks for UTVs and Victory are up slightly.
Polaris is expecting its better-than-expected sales to continue throughout 2010, as it expects its sales growth to finish at 17-20 percent over a year ago. Part of that optimism stems from improved dealer inventory positions. Polaris said it is ramping up production for UTVs to meet increased retail demand and is in much better shape in terms of ATV and motorcycle dealer inventories than a year ago.
Polaris officials also announced its partnership with Bobcat is continuing on pace, with its jointly developed product already arriving at Bobcat dealerships. A second phase of the product, which is expected to be sold by Polaris dealers, is expected to hit the market in another year or two.