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By: Jason Giacchino
Email: offthepegs @ atvsource.com

April 2009 - Off The Pegs

The Realities of Economic Downturns

If you think about it, the ATV business (like most other mechanical industries) has been hit not once but twice with crushing blows this past year. Last year at this time the big talk was oil prices with gasoline hovering near the $4 per gallon mark at the pumps. Perhaps not affected quite as drastically as our automotive-industry cousins on that one, we’re certainly feeling the pinch in this, the second round of economic disaster. Already being touted as the most dismal financial crisis since the Great Depression itself, there is little doubt in anyone’s mind that things have a long way to go to recover to the type of sales ATV dealers have been enjoying up until recently.

It’s rather unfortunate that the economy had to go and tank on us just as things were shaping up in the sport ATV segment. After decades of hoping and wishing for full OEM involvement in the ATV racing scene, things finally started happening at the early part of the new century. Since then the growth of this concept, as has always been the case with the ATV biz, has been nothing shy of phenomenal. With seven legitimate 450cc entries to choose from this year and more factory support than even thought imaginable just a few seasons back, we can only hope that the economic downturn doesn’t put the kybosh on this recent expansion.

According to many of the dealers I’ve been in contact with, the trend has most greatly affected sales of new units. More and more enthusiasts are choosing to extract additional mileage from their current quads rather than upgrade to brand new. Demand for used machines has also been on the rise, which is especially tough considering the lack of trade-ins on new models. Many dealers report this year as being the first real slump encountered since the ATC went the way of the dodo and the term “ATV” became synonymous with four wheels.

This is especially disappointing when merely a decade or so ago ATV sales were credited as the factor keeping many motorcycle dealerships afloat when demand for two-wheelers started to fizzle out. It just goes to show how for as many ways as we’ve been advancing in recent years, we’re still moving backward in others.

The lion’s share of the media of late has turned to focus on the struggling domestic automotive industry (thanks in no small part to bailout money being fronted by us lowly taxpayers). Much like the auto industry, it’s not just the domestic ATV manufacturers who are struggling either as the global economy is heavily influenced by trade with the US. While you may not hear much about the ATV manufacturers on the nightly news, it goes without saying that they are currently experiencing many of the fears and setbacks that the highly publicized auto industry is facing.

Like you presumably, I’m for doing all we can to ensure that the market place stays fertile. Economic stimulus packages rarely delve to include benefits that cater toward power sports or recreational industries. Rather, each of us has the obligation of delegating some of our funds on this, our sport, our hobby, and our love. And to conclude the ripple effect of how supporting our sport comes back around to benefit us all, keep in mind that since January of 2006, Polaris Industries has granted over $700,000 to state, local, and national ATV clubs through their TRAILS program (Trail development, Responsible riding, Access, Initiatives, Lobbying, and Safety). In addition they’ve used their influence (and budget) to assist 78 nonprofit ATV organizations in 42 states in trail development, reconstruction, improvement, and governmental lobbying.

In 2008 Yamaha issued close to $800,000 in grants through their own OHV Initiative program. Calling theirs GRANT (Guaranteeing Responsible Access to our Nation’s Trails), Yamaha accepts applications from clubs, associations, and even government agencies each quarter. Like Polaris, it then allocates funds to such worthy causes as trail development and restoration, maintenance and minimal environmental impact planning, trail labeling/ signage, map production, and rider safety and education.

The bottom line is that our sport’s contributors do much more than simply design and build the machines we enjoy. Without their assistance, it is troubling to even imagine how many land areas would be closed to OHV use throughout the nation.


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