2004 Snowmobile Outlook

Perhaps Tim Conder, vice president of research at AG Edwards & Company, put it best in a recent report he prepared on the international snowmobile industry.
“There should be no surprises for the snowmobile market heading into the 2003/2004 season,” he wrote in the Aug. 18, 2003, issue of Powersports Business. “Excessive inventory carryover from a poor 2002/2003 season will restrict original equipment manufacturer production, allowing dealers to clear 2002/2003 model inventory.”
The only surprise might be the amount of snow dumped on riding areas this year and how widespread it might be. Those areas that had sufficient snow last year did very well and are anxious for the season to get started. Neither the international political condition nor the economy seem to have significantly depressed the pent up demand to ride.
Even though inventories are high, OEMs seem to be adjusting builds to address the situation.
The picture is mixed among dealers, depending upon their recent experiences. “Many dealers are considering dropping snowmobiles altogether,” reports Dave Crocker of Power Products Marketing in his April 2003 survey produced for Powersports Business. “It is their perception that the market may be oversold and oversaturated and that is leading them to much lower margins. Others, however, feel that the demographics appear good for snowmobilers, and consumers will buy if there is snow.”
A final note: The agreement to sell Bombardier’s Recreational Products business to an investment group that includes the Bombardier family is seen as a plus for the industry. The sale, expected to be completed soon, should keep the management team intact, add business expertise and infuse additional capital for product development.