Analyst says new Sea-Doo Spark a ‘game-changing’ intro
BRP unveiled its 2014 lineup of Can-Am and Sea-Doo models last week to kick off its dealer meeting in Orlando, and the results were impressive, BMO Capital Markets analyst Gerrick Johnson told industry magazine Powersports Business, a sister publication of Boating Industry.
“… We view the new lineup very favorably. Based on the reaction from dealers, we believe the 2014 lineup has several other game changing introductions, particularly in Can-Am Spyder Roadster and Sea-Doo Personal Watercraft, which could offer incremental upside to the company’s earnings going forward,” Johnson reports in a research note provided to Powersports Business.
The new value-priced Sea-Doo Spark ($4,999 MSRP) “we think has the potential to significantly re-energize this mature market,” Johnson said. “The Sea-Doo Spark line of PWCs will be the least expensive PWCs on the market, ranging in price from US$4,999 for the base 2-up 40HP model to US$7,199 for a 3-up version with a 90HP engine and intelligent braking system. This compares to current PWCs on the market range from US$7,999 for the Yamaha WaveRunner VX Sport on the low end to US$17,999 for the Kawasaki Jet Ski Ultra 310X. Prior to the Spark announcement, the base price range on 2013 Sea-Doo PWCs was US$8,399 to US$16,999.”
Johnson compared the potential of a value-priced Spark to the tremendous success of the Kawasaki Ninja 300 street bike for the motorcycle market.
"This motorcycle, valued priced at under US$4,500 was likely the best single selling motorcycle in North America in 2013 and sold out at many dealers by late June," Johnson told Powersports Business.
Johnson added that BRP does expect the Spark to cannibalize 10-percent of sales within it's current PWC line-up, but said is forecasting C$65-70 million in sales from the Spark against C$35 million lost.
Combined with improvements to the rest of BRP's portfolio, Johnson rates the company as "Outperform".