POWERSPORTS MARKET INDUSTRY OVERVIEW

Is the glass half full or half empty? Are we half way into a recession or half way to recovery? The jury is still out, but we do know we are at the half-way mark for the year and powersport values continue to hold up well. In fact, most segments are still depreciating mildly and tracking ahead of 2021.

In the motorcycle segment, values for the most recent 10 model years of cruisers averaged 4.5% lower in the first half of 2023 compared to the same period of 2022, and continue to correct back towards pre-pandemic trend. Meanwhile Sportbikes averaged 2.4% lower in the current period than year-prior, and held their value nicely going into the second half of the year.

In the side-by-side segment, the Utility and Sport sub-segments have performed differently in recent periods. Utility machines are showing 5.7% lower values compared to the same period of 2022. The Sport SxS segment is only 2.4% lower than last year, holding steady around the $16K mark.

Looking forward, economic headwinds continue to increase… but analysts have been saying that for a year now! Meanwhile the market remains elevated. We’ll continue to watch employment figures and consumer debt metrics while monitoring wholesale auction sales for notable movements.

In the meantime, it is your call if the glass is half full!

J.D. Power Specialty Valuation Services (formerly NADAguides) is a leading provider of specialty vehicle valuation products and services to businesses. The team collects and analyzes tens of thousands of wholesale and retail transactions per month, and delivers a range of guidebooks, web service data, analysis and digital data solutions. J.D. Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, J.D. Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world’s leading businesses across major industries rely on J.D. Power to guide their customer-facing strategies.

eBikes? We Cover That!

June Awp In Review

Year-over-Year Comparison

Predictably, June Average Wholesale Prices (AWPs) came in well below 3-month and yearover-year (YoY) comparables. All On-Highway products, representing the highest volume categories sold in the lanes, continued to exhibit price declines versus spring values. June also represents the largest delta in YoY AWP when analyzing price versus 2022. Notably, while most categories underperformed YoY, we saw upticks in ATV and Marine pricing compared to the previous 3-month averages.

Stable Auction Volumes

No meaningful changes in auction volume have manifested thus far in 2023, despite wider economic concerns, the narrative about rising consumer debt, increasing interest rates, and slowing retail demand. June auction volume came in slightly below both 2022 and the 5-year average. While dealers have reported a solid spring for new unit sales, DMS data suggests inventories now well exceed new and used levels from 2019. The anticipation is that auction inventory should begin to increase in the summer as retail continues softening and dealer inventories age.

Summer and Fall Trends

To provide additional context to longer-term pricing trends, Q2 2023 aggregate AWP remains 14% higher than Q2 2019. This illustrates the impact of the new product shortages in 2021 and 2022 on dealer demand and pre-owned AWPs. As inventory continues to age and retail slows, our expectation is that AWPs will continue to trend back toward 2019 levels and perhaps even lower. Despite softer comparables in the back half of 2022, expect continued price softening through this year’s summer and fall months.