Polaris Reports 31% Increase in Motorcycle Sales in Q1 2021

Dennis Chung
by Dennis Chung
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Polaris Industries reported a strong start to 2021, with double-digit growth in each of its core segments including a 31% increase in sales revenue from its motorcycle operations.

Motorcycle sales, which include Indian and Slingshot plus related parts and accessories, raked in $165.6 million in sales revenue, up from $126.6 million during the same quarter of 2020. The motorcycle segment had a gross profit of $8.0 million compared to a loss of $1 million in Q1 last year. Polaris also reported Slingshot sales more than doubled over the quarter.

Sales were particularly robust in North America, where Polaris reported an increase of over 60% in Indian sales, a strong showing compared to the overall mid-to-heavyweight motorcycle industry’s mid-30% increase over the quarter.

While the quarter’s numbers were positive, there are some concerns about maintaining that momentum moving forward as dealer inventory levels are well below optimum levels. Polaris estimates that dealer inventory is down 40% compared to the first quarter last year as manufacturing is limited by supply chain constraints and logistical issues.

polaris reports 31 increase in motorcycle sales in q1 2021

Mike Speetzen, Polaris’ interim chief executive officer, provided an example of foam being in short supply at one point, resulting in vehicles rolling off the line without seats. When the supply of foam reached sufficient levels, workers went back to finish those partially-complete vehicles.

Polaris says it is trying to mitigate supply chain delays by adjusting manufacturing capacity and altering logistics to optimize the flow of parts, but the company does not see dealer inventory returning to targeted levels until 2022. We may also see some strategic price increases on some models to help balance supply versus demand.

The Q1 report also revealed some of Polaris’ plans for electric vehicles. Last September, Polaris signed a 10-year partnership with Zero Motorcycles to produce off-road vehicles and snowmobiles. We’ll see the first product of that relationship in December with an electric Polaris Ranger side-by-side. There are no plans yet to expand that relationship to include Polaris-produced motorcycles (Zero is obviously hesitant about competing with itself), but the company is open to the idea, whether it’s with Zero or another partner.

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Dennis Chung
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  • Gabe Ets-Hokin Gabe Ets-Hokin on May 03, 2021

    "Mike Speetzen, Polaris’ interim chief executive officer, provided an example of foam being in short supply at one point, resulting in vehicles rolling off the line without seats."

    What's the problem? Just paint the seat pan black and say it's an MV Agusta.

  • StickyTires StickyTires on May 05, 2021

    I wonder what effect stimulus money had on the growth. Around here, off road vehicles were hard to come by and maybe still are. For some folks, that money provided just the excuse they needed to go buy that new toy.

    • See 1 previous
    • Denchung Denchung on May 05, 2021

      Interim Chief Executive Officer Mike Speetzen, when asked during the Q1 conference call if they could measure how much of an effect the stimulus had:

      "It's tough. I mean, we've gotten that question a lot. I guess I characterize it as it's just fuel to the economy and to what is already a very strong consumer savings rate. And I think if you look at our - we've gone through our demographics and our customer profiles with investors over the years.

      And for the most part, our customers were really stable through the pandemic in terms of their employment level didn't change, they were collecting stimulus money, the stock market is up. Most of them, obviously, have 401ks. And so the financial stability and strength of our customers has certainly been an equation in this, but to be able to try and correlate the stimulus check itself back is tough to do."