People seeking ways to de-stress while staying closer to home
Bombardier, the once giant aerospace and railway giant, has fallen on hard times. Facing massive debts, the huge multinational has been forced to sell off almost all of its designs and divisions of aircraft and rail. Still struggling, it’s only retained the segment making business jets, and with the pandemic and travel restrictions, that’s been hurting as well.
But the enormous company had its start with the creation of the humble snowmobile, first as a several passenger winter utility vehicle, and only much later as a smaller recreational vehicle.
In 2003, as the head office was concentrating on bigger things, they spun off the division into a separate entity called Bombardier Recreational Products (BRP).
After a slow start of several years, the manufacturer had continued to expand its lineup of recreational vehicles from ski-doos and sea-doos, to a wide variety of offroad and other vehicles, now including electric options.
When the pandemic hit, it was forced to shut down like many other companies for several weeks. The Quebec-based operation is now having a much more interesting problem, trying to meet a rising demand.
The pandemic which shut down BRP plants cost it heavily with millions of dollars in lost revenue although a larger portion of that was from a writedown and closing its Evinrude outboard motor section. So far it looks like losses will be temporary. BRP sales were up by 35 per cent in the first three weeks of May. Now a multinational itself, the slowly reopening BRP plants from Mexico are working to meet demand for its multiple outdoor recreational vehicles. According to BRP, orders are already booked up to the end of the fiscal year.
There are suggestions that with social distancing people and the stresses caused by the pandemic, people are looking for ways to have fun without close interaction with crowds and through activities that keep them closer to home.
Other manufacturers in this market have also seen a sales boost. However, with rising unemployment caused by pandemic shutdowns and in a marker sector that depends on disposable income, whether growth and sales will continue upward remains a question.
- Globe and Mail: N.Van Praet: May 21/20 How BRP is making a killing selling off-road vehicles to Americans
- Canadian Press (via Alaska Highway News): May 28/20: BRP’s CEO hopes ‘staycations’ will boost sales of Sea-Doos and off-road vehicles
- Financial Post: E Jackson: May 28/20: Ski-doo maker BRP reports $226 million loss as growth skids in pandemic
- BNN Bloomberg: S.Rastello: May 28/20: Sea-Doo maker BRP rushes to meet rising demand after shutdown