The All-Terrain Vehicle Market, by value, is projected to grow to USD 5.0 billion by 2027 from USD 4.3 billion in 2022, at a CAGR of 2.7% during the forecast period. The increasing demand for ATVs in military, agriculture, and sports applications is the major factor driving the all-terrain vehicle market.
Market Dynamics
DRIVER: Increased demand for recreational activities, agriculture and military operations.
The number of recreational events is constantly increasing every year. The ATV championships with off-terrain ATVs in challenging conditions are organized by sports authorities at national levels. The US holds multiple racing events across the year where participants compete for title and rewards. World Off-Road Championship Series (WORCS) is one of the biggest racing events organized in the country. Along with this, John Deere, a large agricultural and farm equipment manufacturer recently launched UTV models for farming applications. This due to high demand for such vehicles by customers working in the agriculture sector for various applications. For instance, in September 2020, John Deere updated its legendary line of Gator™ Utility Vehicles (UVs). Similarly, owing to the increase in military budgets around the world and successful applications of ATVs in military operations due to their modularity and functionality it is expected that demand for such military special ATVs will rise in the future.
OPPORTUNITIES: Positive outlook towards electric ATVs will create new opportunities.
The adoption of technologies related to electric ATVs has been increasing among ATV manufacturers. Leading markets for electric ATVs such as China, US, and Germany are investing heavily in R&D infrastructure for off-road vehicles. Since there is a lot of pressure on OEMs, mainly due to new regulations implemented by the countries worldwide, to reduce their greenhouse gas emissions, most of this investment is likely to go towards the development of electric powered vehicles and same applies to ATV market as well. In 2021, Polaris launched its EV ATV, Ranger XP Kinetic, model that it developed in collaboration with Zero motorcycles company. It has a 14.9kWH battery and can travel 45 miles on a single full charge. Polaris also partnered with a company Qmerit which is a provider of residential EV charging infrastructure. Similarly, in UK, the company Ecocharger is an all-electric ATV manufacturer. Their models are primarily driven by either lead acid or lithium-ion batteries. They have a strong presence in the European continent and have plans to expand dealerships across southern and central Europe. This indicates customers are demanding more electric ATVs either from a climate conscious mind or to comply with the country regulations. Nonetheless electric ATVs are set to have a growing market share in the future.
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“Sports to be the fastest segment, by type”
The sports segment is projected to be the fastest in the all-terrain vehicle market by type. ATVs used in sports feature energetic engines and long-travel suspension for a better handling experience. Riders prefer sport ATVs, especially in ATV championships. Their high-power engine and torque make them distinctive. The engine capacity of sport ATVs ranges from 100 to 1000cc. Also, sport ATVs can be modified and equipped with different accessories to design a unique style and power. The shifting skills and handling features make these types of ATVs ideal for sporting activities. The shifting skills and handling features make these types of ATVs exclusive for sporting activities. Almost every major player in the industry provides a wide range of customization options to customers to make their ATVs faster, agile and swift on racing tracks. Yamaha Raptor 700R SE, YXZ1000R SE, and YFZ450R SE are some of the popular sport ATV models available in the market. Sportsman XP 1000S, Scrambler 850, Scrambler XP 1000 S Limited Edition are some of the Polaris sports ATVs. Thus, the increase in recreational activities in the tourism sector is driving the growth of ATV market in sports applications globally.
Key Market Players:
The all-terrain vehicle market is primarily dominated by globally established players such Polaris (USA), Honda (Japan), Can-Am (Canada), Yamaha (Japan), and Textron (USA). These companies are consistently developing new products, adopted expansion strategies, and undertook collaborations, partnerships, and mergers & acquisitions to gain traction in this high growth ATV market across different regions.
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