Conditions appear right for a bounce back in the snowmobile business, which appears much less burdened by an excess of noncurrent inventory than a year ago and is gearing up for a predicted snowy winter.
“That’s what I’m seeing and hearing too,” said Ed Klim, president of the International Snowmobile Manufacturers Association (ISMA).
National forecaster Accuweather is predicting plenty of snow for key areas of the nation this winter as the weather phenomenon called La Nina is expected to dictate the severity of snowfall.
Combine that with significantly reduced noncurrent inventory in the marketplace — Klim says it’s the lowest he has seen it in his 15 years in the industry — and it’s little surprise to see dealers and OEMs counting the days until the first heavy snowfalls.
“In general, I’m hearing, relative to the rest of the economy, a very upbeat story,” Klim said.
In terms of preseason interest in snowmobiles, dealers in the north see a mixed picture.
Mike Catlin, co-owner of Appleton Powersports in Appleton, Wis., says used sled interest is up slightly, but overall preseason sales are on the same pace as this time last year.
“We sold the same amount of preseason Ski-Doo’s that we sold last year, which was very good,” he said. “So we are happy about that.”
Robert Hintz, general manager of The Engelhart Center in Madison, Wis., saw enough off-season interest in snowmobiles this year that he had some situated in key areas of the showroom back in late July and early August. Some of those sleds in prime showroom spots included noncurrent inventory and the sales message to the public was, “if you want a deal, buy it now because the price will go up in September and October, and people paid up for it. They got some great prices on stuff.”
In Oshkosh, Wis., Lee Van Zeeland, owner of Team Winnebagoland, expects to see sale declines this year, although that’s more of an indication of certain wholesale opportunities not being available rather than a lack of consumer interest.
“Snow business is down for me around 25 percent from last year using August, September and October,” he said. “That said, I would say the reason is not that business is really down this year, but that last year was way up because of a special purchase (auctions) that I made last year that is not available this year. I am still feeing good about the business, but do expect it to be off for my stores.”
Klim of the International Snowmobile Manufacturers Association said he has seen or heard of solid consumer turnout at national preseason snowmobile shows. “Generally speaking, the shows are either equal to last year or up just a little,” he said. “We’re not seeing big bumps upwards, but we are seeing an active crowd.”
That was particularly the case, Klim said, at a Washington state swap meet that featured a number of used vehicles.
U.S. snowmobile sales fell 27 percent last selling season, which isn’t bad when compared to the powersports industry’s retail sales as charted by the Motorcycle Industry Council. Those sales dropped nearly 37 percent in 2009.
Canada’s retail sales also dipped last year after rising the prior year. Klim attributed the year-ago decrease to the declining auto industry’s impact on a key Canadian province, Ontario.
“It wasn’t long ago that people thought Michigan was the headquarters for auto manufacturing. It hasn’t been for a long time,” Klim said. “They build more cars in Ontario than they do in Michigan.”
Nearly every other province in Canada saw a slight increase in sales last year, said Klim, who is optimistic about some better results from Ontario this year.
If nothing else, the lack of a noncurrent-dominated market should prove positive for the upcoming selling season. “It’s a very, very manageable number for the industry,” Klim said of the noncurrent inventory. “The dealers are in good shape (in terms of inventory) and so are the manufacturers.” PSB