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A Tough December

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Mother nauture nuetralizes winter sales

[dropcap]O[/dropcap]ur latest survey of powersports dealers indicates that December was another tough month for dealers across North America. Indeed, it appears that the weakness in November intensified somewhat in December, which ended 2015 on a bit of a sour note.

While there was some talk of slow traffic trends, and customers trading down to lower-priced product, the most commonly cited sources of weakness in our conversations include (1) ongoing economic weakness in areas that depend on energy prices to drive the local economy and (2) a lack of snowfall, which has pressured snowmobile and off-road vehicle sales.

MIR_Screen-Shot-2016-02-08-at-10.30.09-AMThese issues have contributed to excess inventory at the dealer level; and consequently, more aggressive discounting by dealers who have been fighting it out for the volume that is there to be had. That said, these issues are largely regional and should be helped by the fact that Polaris, the largest ROV maker in the industry, slowed shipments to right-size dealer inventory late last year.

Moreover, January looks to be a better month with respect to snowfall. Indeed, recent conversations imply that trends have seen a modest bounce this month in areas impacted by weather. While there are still a lot of mixed signals in the marketplace, most signs point to a relatively healthy U.S. consumer, which should help powersports dealers in 2016.

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