North American snowmobile sales decline 4.5% in 2003-2004

U.S. Market Off 5%, Canada off 4%, Inventories down over 30%
EDITOR’S NOTE: During April, Power Products Marketing conducted a survey on behalf of Powersports Business among 150 snowmobile dealers across the northern United States and Canada. These 150 dealers collectively accounted for more than 9,000 snowmobiles sold during the 2004 season, which we estimate represented about 7% of the total market. These dealers were asked specific questions pertaining to their 2004 season sales, carryover inventories and orders for the 2005 season. This research was supplemented with recent reported industry information obtained from several knowledgeable industry sources.
2004 Season End Sales
According to our survey and industry sources, total North American snowmobile sales for the 2004 sled season, which concluded March 31st, declined approximately 4.5% from the previous year.
This marks the seventh consecutive annual decline for the North American market from a peak of nearly 240,000 sled sales in 1997 to our estimated 2004 level of 157,000 units.
Declines in snowmobile sales in the U.S. and Canadian markets were similar for 2004, though for the third consecutive year the Canadian market was stronger.
For 2004 U.S. snowmobile sales declined about 5% compared to the 2003 season while Canadian retail sales fell by approximately 4%. The previous year, U.S. sales had declined nearly 15% from 2002 season totals while Canadian retail sales were essentially flat.
According to the latest sales estimates, the Canadian market now accounts for slightly under 31% of North American snowmobile sales. Canadian sales have historically represented less than 30% of North American sales, and have risen from a recent low of 25% of North American sales in 2001.
We reported in our January Trendline analysis that year-to-date 2004 North American sled sales through November were estimated to be running 5% behind the previous year’s pace.
While snow brought sales spikes in December and established a base for a positive year in sales, January through March sales fell off quickly. Aggressive non-current discounts, rebates and extended warranties helped end of the season unit sales, but not enough for the season to end on a positive note.
Weather conditions were sporadic across North America during the 2004 season. For example, in some areas in the Northeast, temperatures were actually too cold to ride, while other areas in the East saw winter rain that washed out many of the trails within the same general period. Luckily for eastern dealers, most sold the majority of their product early in the year and ended up about even in terms of annual sales growth.
The Midwest appeared to be the weakest region, with sales down slightly over 7%, while in the West, sales were down only a few percent.
Considering that production for the 2004 model year was off in the range of 15%, with some manufactures exceeding that figure considerably, a sales reduction of 4.5% is not entirely bad news.
Top-Selling Snowmobiles
Reflecting the aggressive push to clear non-current models, the Polaris 600 XC SP was one of the leading models in terms of overall sales.
Other leading models included the F7 from Arctic Cat and the Ski-Doo MX Z Adrenaline 600 HO.
Current vs. Non-Current models
Last January, we reported that towards the middle of the season, non-current sales were running about 38% of annual sales with the Midwest as high as 50%.
The aggressive discounting and promotion of non-current models held through the season with year-end non-current sales estimated to be just under 40%. This non-current figure is quite high from a historical perspective; non-currents for 2003 were estimated to be 25%.
For the second consecutive year, non-current sled sales increased, while current model sales decreased in excess of 10%. As stated above, with the reduction in current year production and strong incentives on non-currents, this should be expected.
Dealer Inventories
The positive side of high non-current sales is that dealer inventories were dramatically lower at the end of the 2004 season. We estimate that overall inventories were reduced by over 30%.
We asked dealers in November to segment their inventory by model year and at the end of the year we updated these estimates. Surprisingly, the inventory breakdown by model year appears to have for the most part stayed the same.
Inventories By Model Year
Current 2003 Pre 2003
November 71% 24% 5%
Year End 71% 23% 6%
While dealers were successful in clearing substantial amounts of non-current inventory, a fair amount of older sleds remain in dealer inventories.
It appears that a small number of pre-2003 models continue to be a challenge for dealers to sell. These models are often older generation chassis configurations that are a tough sell to a market that tends to want the latest in chassis and technology.
2005 Orders
Snow Check spring sales reported by the dealers we spoke with were on average slightly off last year’s pace.
While several new products were introduced for 2005, not many were directed at the 600cc heart of the performance trail market.
Preliminary estimates are that spring snow check sales declined in the range of 7-8%, which was good compared to the previous year’s 25% spring decline.
For the upcoming 2005 full model year, orders seem to be stronger. The 150 snowmobile dealers contacted stated on average that their orders for the 2005 would be 8% ahead of their orders for the 2004 season. psb
Greg Boeder is senior partner for Power Products Marketing, a market research firm based in Minneapolis, Minn. PPM ( specializes in the power products and components, powersports and marine industries. Boeder may be reached at 952/893-6870 or at

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