Electrification trend is creating new space in the market that “can’t be ignored,” CEO Boisjoli said. — Bloomberg
MONTREAL: Snowmobile manufacturer BRP Inc hasn’t made a motorcycle in nearly four decades, but the company believes growing interest in electric vehicles gives it an opening – if consumers are willing to pay up.
Chief executive officer Jose Boisjoli, who announced the new line of electric motorcycles at a gathering for dealers last month, said the market for gas-powered motorcycles is already too mature to enter.
But the electrification trend is creating new space in the market that “can’t be ignored,” he said.
The catch is cost. BRP’s new e-motorcycle offerings, the Can-Am Pulse street bike and the Can-Am Origin off-road adventure bike, range from US$14,000 to US$16,500, which is still 20% to 50% more expensive than popular gas-powered models from the likes of Honda and Kawasaki, according to Siyi Mi, an analyst on electric vehicles (EV) for BloombergNEF.
Harley-Davidson Inc’s LiveWire S2 Del Mar electric bike is in a similar price range, starting at US$15,500, but with a slightly better range than Can-Am’s 145km to 161km and almost twice the horsepower.
While electric two-wheelers are the fastest growing segment of EVs, much of the strength lies in scooters and mopeds, according to analysis by BloombergNEF. E-motorcycles need larger batteries, which raises the cost and slows adoption.
Companies are looking for a battery that gives adequate range without pushing up the price too high, but it might not yet exist for most riders.
Ducati Motor Holding SpA, for example, has been reluctant to race ahead of the availability of denser batteries. It’s going to be some years before the Italian brand puts an e-bike in showrooms, Jason Chinnock, chief executive of the Italian company’s North American unit, told Bloomberg Television in early 2023. “The battery technology really isn’t there,” he said at the time.
In BRP’s case, motorbikes are a long-term bet to help grow a business that has run into short-term problems.
Last week, the company – which was separated from Bombardier Inc long ago in a transaction backed by Bain Capital – chopped its earnings outlook, saying it’s still working on reducing inventory.
Revenue is expected to be just C$7.8bil to C$8bil in the current fiscal year, the company said, down from C$10.4bil or about US$7.7bil in the previous year. Profit margins are getting crushed amid heavy promotional activity in the power-sports sector.
BRP’s own surveys of customer appetite for EVs were only minimally promising. Asked whether they were interested in electrified products, respondents replied yes at a rate of 85% to 90%, Boisjoli said. But when told these vehicles might come with disadvantages – more cost, more weight, less range – interest fell to 10% to 15%.
Range remains the biggest limiting factor. E-motorcycles start making more sense for riders once the battery can last more than 201km – roughly the distance between Hartford, Connecticut and New York City, according to Ryan Kluftinger, who does news and reviews for the motorcycle retailer FortNine’s YouTube channel.
The best part of the experience, according to both Boisjoli and Kluftinger, is the quiet. BRP uses an enclosed chain system on the rear wheel of Can-Am bikes that cuts down significantly on noise.
“When you go on the trail or on the road with no noise, you’re more attentive to the environment,” Boisjoli said. — Bloomberg
