On Oct. 21, industry stakeholders held an informal meeting to the promote importance and pose potential future industry challenges of the powersports industry to members of Congress.
The Zoom briefing included Congressional Outdoor Recreation Caucus members and representatives of the boating, snowmobiling, RV, and other powersports sectors who outlined new data related to consumer behavior during the pandemic, future challenges and the importance of key outdoor recreation policy to reinvigorate the U.S. economy while keeping up with the increasing interest in outdoor activities.
“To our delight during the pandemic people realized that powersports was a great way to social distance, and we saw a huge spike in sales and participation,” said Scott Schloegel, senior vice president of government relations for the Motorcycle Industry Council (MIC), during the event. “We saw a 53% increase in off-road motorcycle sales. We saw many people rejoining the sport, and many that were new to it.”
According to the informal presentation, “Prior to the pandemic, the industry generated $778 million in economic output, comprised 2.2% of GDP and supported 5.2 million jobs. While outdoor businesses have been hit hard by the pandemic, social distancing and lockdowns have reignited America’s passion for the outdoors. Less than 50% enjoyed an outdoor experience in 2019, but a May survey found that 81% had spent time outside recently, with 32.5% turning to outdoor recreation for the first time. The Outdoor Recreation Roundtable was created to educate Capitol Hill staffers, industry partners and the press on the new opportunities facing the industry.”
Topics discussed were the recent influx of new consumers entering the industry as well as the need to have new ways of accessing the outdoors, which have new challenges and opportunities posed by the participation increase as a result of COVID-19.
”With all the new people we have riding on the trails, it’s critical that we have places to ride,” said Schloegel.
Funded by a user-pay model recreational gas tax, the Recreational Trails Program (RTP) currently has a funding of $84 million split among each state. However, with estimated tax revenues in excess of $300 million annually, the MIC will look to lobby to increase fund appropriation to $150 million in future sessions. The RTP funding can be used in a variety of ways, creating trails for many industries – both motorized and not.
“We’re looking to raise the authorized amount for RTP projects, which can be used for both construction and maintenance of a wide variety of trails. As we’re looking for more ways to support outdoor recreation, we will look to further use the RTP,” said Schloegel.
“We would love to see Congress pass a recreation package that includes key legislation that are relief for the industry,” said Jessica Turner, executive director of the Outdoor Recreation Roundtable. “This is an industry that hasn’t had a ton of attention [from Congress], and just like any other we want to grow economies, put people to work and make sure everybody has a great way to enjoy the outdoors.”
Heading into winter, president of the International Snowmobile Manufacturers Association (ISMA) Ed Klim acknowledged the snowmobiling selling season effectively ended prematurely in March of 2020 with the onset of COVID-19 and the lockdowns that followed.
“We had a great year going that was stopped short – It [COVID] cut our snowmobile sales off at the knees,” said Klim. “It’s been some longs months to get over it, but we’re really excited now, because the upcoming winter will be snowy and cold.”
Annually dependent on snowfall totals to propel popularity and sales, Klim was pleased to report 6 to 9 inches of fresh snow has already fallen in the Upper Peninsula of Michigan.
According to ISMA data, total pre-order sales of 2021 models have increased by 10% year-over-year industry-wide. “All four manufacturers have caught up on production months ago, and they’re making more every day,” said Klim.
Collectively there are more than 3 million self-described snowmobilers and 136,000 miles of trails that stretch from Maine to Washington, with snowmobiling available in 24 different states. Annual snowmobile registrations help fund trail systems. “We are partners with, and support the RTP - it’s a great asset to the outdoor recreation community,” said Klim.
Many snowmobilers are also active members of the more than 2,000 registered snowmobile clubs, which are active year-round to serve as social clubs as well as volunteers to build and maintain trail systems.
“Looking ahead, early sales of riding and trail permits are up,” said Klim, who noted that snowmobilers have been practicing social distancing for years.
When asked to predict an overall industry outlook throughout the remainder of COVID-19, responses were hesitant, but optimistic.
“I think some of the spike we had from the stimulus has flattened. A lot of people were willing to go out and make purchases during that timeframe, but as COVID continues, depending on how long it takes for a vaccine you might see priorities shifting,” said Schloegel. “It’s a little bit of a wild card to see how COVID will treat us this winter season, and into the spring. Certainly record sales are not sustainable forever, and we realize that.”
“Distribution problems are going to continue as well, and that’s something to think about as record sales have caused some [manufacturers] to run out of product,” said Turner. “We want to be able to keep up with demand, but it’s hard under COVID restrictions – it costs more to do it safely.”
— Nick Longworth, Powersports Business, nlongworth at epgmediallc.com
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