ATV Imports from China and Taiwan Gaining Increasing Market Share
January 27, 2005
Filed under Uncategorized
Power Products Marketing has been tracking sales of ATVs produced in the Far East for nearly five years, but it gets more difficult every year, given the growing number of OEMs importing to an increasing number of U.S. distributors.
It is not unusual for some OEMs to have several distributors marketing their ATVs under different labels. For example, Taiwanese manufacturer Her Chee has appointed at least a dozen different “distributors” of their ATVs over the last four years, including Arctic Cat and BRP (formerly Bombardier). Then, last summer, the company set up its own Adly USA factory-owned office in the United States.
2003 & 2004 U.S. YOUTH ATV SALES
By our estimate, there were about 51 suppliers (importers/distributors) selling youth ATVs in the U.S. market in 2003, compared to 42 firms in 2002. In 2000, there were 24 suppliers by our count compared to just eight in 1998. We estimate this number has jumped to about 75 suppliers during 2004.
U.S. IMPORTERS OF YOUTH ATVS
1998 ... 8
1999 ... 15
2000 ... 24
2001 ... 36
2002 ... 42
2003 ... 51
2004 ... 75
According to our research, U.S. youth ATV sales increased about 3.5% in 2003 to over 152,000 units from about 147,000 in 2002, including Taiwanese and Chinese imports. Although November and December sales were not available from various distributor contacts in time for this issue, it appears that mini quad sales for 2004 could increase as much as 5% over 2003 to about 160,000 units. Because of the strong Christmas buying influence, December alone typically accounts for about a quarter of annual sales.
Along with these modest increases, there are many shifts going on in the market with new OEMs and distributors entering in large numbers. For example, OEMs not reporting to the MIC are estimated to have accounted for about 51% of total U.S. youth ATV sales in 2002. This ratio slipped to 48% in 2003 but jumped back up to nearly 55% in 2004.
U.S. YOUTH ATV SALES TRENDS
If we segment the market between 50cc, 90cc and 100-125cc niches, our data indicates that about 34% of the 2003 U.S. mini quad market is in the 50cc and below category. This appears to have increased slightly from what had been about 31% in 2000. The 90cc segment that includes engines generally displacing 62-90cc and different size frames represented nearly 59% of 2003 youth sales, a slight decline from what had been about 63% in 2000.
The remaining 100cc and 125cc models are estimated to have accounted for nearly 7% of sales in 2003, up a half point from 2000. The data we compiled reflects total U.S. youth ATV sales and includes estimates for MIC members. It seems to indicate that there has been very little shift among these three categories over the last four to five years.
Four-stroke engine sales are estimated to have amounted to over 37,000 units for 2003, or nearly a quarter of total youth ATV sales. Of that number, about a third is estimated to come from Chinese and Taiwanese importers.
In 2000, there were nearly 15,000 4-stroke youth ATVs sold in the U.S. market, a 15% share of total youth sales. About 15% of the 4-stroke youth ATVs sold here came from Chinese and Taiwanese importers.
We've been predicting over the last three years that this 4-stroke share would increase significantly as the EPA and CARB enforce stricter emissions.
YOUTH ATV MARKET SHARES
According to our calculations, for 2003 the number one OEM in U.S. youth sales is Aeon Motor Co. with about 24% of the market, split between their AlphaSports and Polaris U.S. distributor customers.
A distant number two is Suzuki with an estimated 13% share, including both Suzuki and Kawasaki brands. Yamaha is ranked close behind Suzuki in the third position with an estimated share of about 12%.
Ranked closely at fourth and fifth appears to be Dinli and E-Ton with estimated shares of 10% and 9% respectively. Her Chee is believed to be sixth with about 7% of the market in 2003.
These six OEMs are considered to have accounted for about 75% of mini ATVs sales in the U.S. market in 2003. These trends were very similar to previous years, we found, with the exceptions being that Dinli, Her Chee and E-Ton all made big moves in the market during 2001, offset by Aeon's eleven percentage point drop in share from nearly 37%.
We can expect to see this top-six percentage decline as the market continues to grow and more competitors enter the market. For example, during 2004 Pep Boys was selling two 90cc ATVs, one by Qianjiang Motorcycle, or QJ Motors, and another believed to be produced by China Xingyue Group that is distributed by Panterra Motors and imported through a Nikota power tool subsidiary of CX.
Chongqing Wangguan Motorcycle Industry Co., also known as CQ Motors, is selling Yamoto brand mini ATVs through its Patriot Motorcycles U.S. distributor.
People's Motor is selling a 50cc and 90cc mini ATV through Dazon, Inc. China Qingqi has expanded its distribution of mini ATVs through Pioneer Motors, China Depot and DareDevil in addition to Midwest Motor Vehicles.
Loncin also appears to have expanded its U.S. distribution in 2004 through Tank Sports and Motor Sports LLC. Barossa is selling a mini line through Behr Power Sports, a Michigan distributor. Finally, Unison Motors appointed Kolpin Outdoors to distribute a line of youth ATVs in late 2004.
ADULT-SIZE U.S. ATV SALES
In 2003, an estimated 737,000 adult-size ATVs were sold into the U.S. market, including estimates for Taiwanese and Chinese imports over 125cc engine displacement. This compares with 705,000 in 2002, 675,000 in 2001 and 625,000 in 2000, which predominantly reflects MIC member totals published annually.
Based upon our research, about 2.5% of the 2003 adult ATV sales total represented mostly Taiwanese and Chinese imports compared to about 1% in 2002. Adult Taiwanese and Chinese ATV sales in 2001 and earlier accounted for less than 1% of the total U.S. adult ATV total. These were nearly all confined to between 150cc and 250cc models with a dozen different models being 250cc.
During 2004, we expect adult ATV sales will increase from 737,000 units to about 760,000 units, of which the percentage of Taiwanese and Chinese imports will have grown from 2.5% to nearly 4%. Some of this will exceed 250cc as these Far East OEMs are starting to introduce larger displacement ATVs. For 2005, we anticipate adult U.S. ATV sales could perhaps reach 785,000 units with Far East imports totaling about 6% of that number.
Dave Crocker is senior partner for Power Products Marketing, a market research firm based in Minneapolis. PPM (www.powerprods.com) specializes in research for the power products and components, powersports and marine industries. Crocker may be reached at 952/893-6870 or at firstname.lastname@example.org.