PowerSports Business

Sept 4, 2017

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38 • September 4, 2017 • Powersports Business www.PowersportsBusiness.com ATV/UTV Ontario-based amphibious vehicle maker adds to product offerings BY LIZ KEENER SENIOR EDITOR When ARGO invited the Powersports Business editors to ERX Motor Park in Elk River, Min- nesota, none of us expected to see four-wheeled vehicles unveiled. ARGO, known for 50 years for its six- and eight-wheeled XTV (extreme terrain vehicles) amphibians, pulled the cover off its first line of ATVs to media in mid-July. Dealers were privy to the release in mid-August. The 2018 Xplorer line of ATVs includes the XR 500 series, the XRT 500 2-Up models and the XRT 1000 LE. NEW ADDITION After five decades of manufacturing only XTV amphibians, the first question for ARGO was: Why ATVs? The decision, president Brad Dar- ling explained, came after research with current ARGO dealers and customers. "We really focused on what is a natural product line to add to our current portfolio, the ARGO XTV, and it was ATVs," he told Powers- ports Business. The team at ARGO knew they wanted to expand their product base and offer more to their dealers. ARGO asked the dealers if they would be adding a new line of any of a number of vehicles, from powersports vehicles to lawn and garden equipment, to their stores within the next 12 months. Only 6 percent said they'd be adding ATVs, and 7 percent planned to add side-by-sides. However, when those same dealers were asked if they would be interested in carry- ing an ARGO-branded ATV or side-by-side, 64 percent said they would be extremely or very interested in ATVs, and the same went for side-by-sides. "What we knew then was we had a brand name that our current dealer base absolutely respected and thought it might have power bringing it to the ATV and side-by-side busi- ness," Darling said. With those results in mind, ARGO then surveyed its current customers. "What we found out is our owners — 67 percent of them — own an ATV and an XTV, so they are already in the ATVs," Darling reported. However, only 21 percent said they had a side-by-side and an XTV. Digging further, ARGO discovered that 46 percent of its cus- tomers considered purchasing a side-by-side when they made their decision to buy an XTV, but that they chose the XTV instead of the side-by-side. ARGO also probed further about ARGO XTV owners' ATVs and discovered the age of the ATVs owned varied. "We thought maybe it was an older ATV that they replaced with an XTV, but no, some were older, some were newer, some were the same model year," Darling said. "So we asked them the model year that they're buying, and what we said was, 'We've got an owner base that requires an ATV and a side-by-side or an XTV.'" DEVELOPING THE ATVS With its research complete, ARGO staff began thinking about what they could do to differentiate its ATV lineup from others on the market. "We're going up against some big, big play- ers, and we're not going in to take these guys out. What we want to do is say: How can we offer our dealers more? And as I think of that, it's: How can we get our niche of this prod- uct," Darling said. The first consideration made was what, if any, ATV brands ARGO dealers were already carrying. ARGO found most dealers either weren't carrying ATVs, or they were carrying Japanese ATV brands. After looking at what the Japanese brands offer, ARGO staff decided a 2-Up ATV would differentiate the ARGO brand on a showroom floor. ARGO also made a goal of offering a 500cc machine in a full-size frame, while at the same time offering the unit at a mid-size price. To do this, ARGO entered into a contract manu- facturing agreement with Taiwanese manufac- turer TGB, Taiwan Golden Bee Co., Ltd. TGB is ISO9001 and TS16949 certified. The ATVs meet SVIA, EPA, CARB and DOT require- ments. The ATVs are ARGO engineered. "We put a lot of ARGO DNA in the prod- uct in focusing on tires, how it rides and han- dles, suspension. Then on the four-wheel drive, we wanted to make sure we had diff lock and that we also offer power steering," Darling explained. He added, "We knew when we came up with this ATV that we could not come up with something inferior; we could not come out with something that's going to pull our brand down. We have to be into quality." ATV LINEUP ARGO's Xplorer 500 ATVs are all powered by a 503cc, 39 hp, electronic fuel injected engine. And each ATV in the ARGO lineup includes: double A-arm front and rear suspension, a 165-pound-capacity steel rack on the back and a 99-pound-capacity steel rack on the front, an anti-vibration 2-inch receiver hitch, differential lock and a digital display. Tri-Mode Speed Sensitive (TMSS) electronic power steering is available on some models. The XR 500 series offers a standard model, an EPS version and an LE, which includes EPS, as well as premium 26-inch Innova tires mounted on 14-inch black aluminum wheels. The base and EPS versions are available in green or red, while the LE comes in orange or silver. The MSRP for the Xplorer XR 500 is $5,999. The XR 500 EPS retails for $6,899, and the XR 500 LE has an MSRP of $7,399. The 2-Up XRT 500 line offers the same trim levels as the XR 500 group. However, the XRT 500 and XRT 500 EPS are only available in red, while the XRT 500 LE comes in orange or sil- ver. The XRT 500 will retail for $6,999, and the XRT 500 EPS has a $7,899 MSRP. The XRT 500 LE is $8,399. In addition to the 500 models, ARGO is offering a 2-Up Xplorer XRT 1000 LE for 2018. Powered by a 997cc, 4-stroke, single overhead cam V-twin, the XRT 1000 also includes active descent control and an electric unlocking, turf mode, rear differential. The XRT 1000 LE has a $12,699 MSRP. BRINGING THE ATVS TO DEALERS Dealers were introduced to the ATV lineup at ARGO's 50th anniversary dealer meeting Aug. 13-16 at the company's headquarters in Canada. The Ontario event included new product introductions, vendor displays, a business meeting, demo rides, and tours of the ARGO, Ontario Drive & Gear and space and robotics factories. About three-quarters of ARGO's 300 North American dealers were expected to be in attendance. Darling explained that not all ARGO deal- ers will be required to add ATVs to their show- rooms. "ATVs don't sell in every dealership, so we want to make sure it's the right area and makes sense. What we don't want to do is ship an ARGO dealer ATVs because they really want them, and all of a sudden they sit around, and it starts affecting our XTV business. So it's more about sitting down with our dealers and saying, 'If you want the ATV line, here's the plan. Let's put together a plan that makes sense,'" he said. Like it does with ARGO's XTVs, the OEM is offering a replace retail stocking plan for the ATVs, so as not to flood the network with ATVs. "Our plan is individual by the PMA, or the primary market area," Darling reported. "We're not going to load up the dealer." ARGO says the ATVs will provide a high profit margin and incremental sales for dealers taking on the line. ARGO'S FUTURE Though ATV sales have been relatively flat around 217,000-229,000 new units sold annu- ally in the U.S. since 2011, Darling still sees the market as one with potential in the niche ARGO has chosen. "It's still a large market. Compared to where we've been with our XTV, it's a larger market. Our XTV won't replace a side-by-side, won't replace an ATV, and vice versa, you can't take an ATV or a side-by-side where you can take our XTVs. So it compliments the line, and it really is a product we can bring into the port- folio of our dealers and offer the ability to have incremental profit for our dealers." Along with the ATV addition, ARGO also announced at its dealer meeting that the XTV lineup has received a number of upgrades. "There are a lot of improvements to the XTV ARGO celebrates 50th with entry into ATV market See ARGO, Page 40 Designed to give ARGO dealers more product offerings, the ARGO Xplorer ATV lineup is available this fall. Photo by Christopher Olaf Berg/ChristopherOlafBerg.com

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