OEMs find snow, and sales, in Europe, Russia – September 4, 2006
September 4, 2006
Filed under Features
Worldwide snowmobile sales remain gloomy, but growing demand in Russia and Scandinavia offers a sprinkling of sunshine amid the bad news.
For the 2005-2006 selling season, worldwide snowmobile sales dipped 5 percent to 164,860 units, according to the International Snowmobile Manufacturers Association (ISMA).
Since 1997, global sales have dropped nearly 37 percent. However, the Russian and Scandinavian markets posted a 14 percent sales gain last year and have seen double-digit growth in five of the past six years, says Ed Klim, president of Haslett, Mich.-based ISMA. Sales in that market last year represented about 19 percent of the worldwide total.
Klim attributes the gains in Russia and Scandinavia to “money and snow; it’s that simple,” he says. “It’s a bright spot for snowmobile manufacturers. Their economies are doing well.”
Russian winters, especially farther north, continue to produce adequate snow for snowmobiling. Combine that with Russian oil field workers flush with cash and the need for workers to commute by snowmobile over roads that don’t get plowed, and one gets rosy sales figures, says Klim. “Russia is the largest producer of oil in the world, and when those workers get time off, they want to go snowmobiling,” Klim says. “They love American-made products.”
The ISMA president adds that one in five snowmobiles sold in Russia are used in work-related activities, used by professionals such as doctors, dentists, nurses and veterinarians to get around during the heavy snow months of November through April.
Sweden and especially Finland allocate considerable financial resources to building and maintaining extensive trail networks that encourage snowmobile use from residents and tourists alike. Like Russia, Norway derives much of its net worth from drilling oil, which is especially lucrative these days.
“When I was in northern Finland, I saw a whole planeload of tourists from Europe get off the plane, go the motels and rent snowmobiles and all the clothing,” Klim said. “Sweden has some of the same aura to attract tourists for winter tourism.”
Manufacturers have noticed the trend, too.
“We’ve seen some market growth there,” says Francois Tremblay, snowmobile marketing director at Ski-Doo. The company sells two Ski-Doo and one Lynx model into that market. Lynx is not sold in the United States. “It’s not a huge market, but there is potential in the short term for growth there.”
Arctic Cat and Yamaha both use local distributors to handle sales in those markets. Adam Sylvester, snowmobile product manager at Yamaha, says the Russian market is comprised mainly of wide track, work-style units. He notes the VK Professional has been well received in that market.
John Tranby, marketing and communications manager for Arctic Cat, says the company has seen “not insane growth, but a good market.” Despite the advances of the Russian economy, Tranby says sales could be even better if the economic and political situations in the country would stabilize further.
Last year, dealers in Russia and Scandinavian sold more than 31,000 snowmobiles, an increase of 82 percent over the past five to six years, says Klim. “The market, dollar-wise, is close to $2 billion over there, with about 400 dealers in Norway, Finland, Sweden and Russia selling snowmobiles and motorcycles,” Klim says. psb