WGO سعر البيع 28 [الأرشيف] - منتديات أعمال الخليج

وائل خيرى مطاوع

14-03-2003, Fri 6:09 AM

CHICAGO, March 13 (Reuters) - Many of Bob Stuchlak's customers are passionate about the motorcycles, all-terrain vehicles and jet skis he sells at his store in Hammond, Indiana. For them, the thrills are well worth the price.

But enthusiasts who wouldn't have thought twice about splurging on power sports equipment a year ago are now hesitating, fearful that they could lose their jobs and not be able to make the payments. Stuchlak is feeling the pinch.

The owner of Xtreme Motorsports says sales have slowed to a trickle since last summer, as anxiety about the economy and a war in Iraq swells throughout the American heartland. To make matters worse -- at least for snowmobile dealers -- for several winters in a row, snowfall was not as heavy in the Midwest.

"Between the weather, the war and the economy, it has really cut sales drastically this year," said Stuchlak. "Everybody is just holding off, because they don't know what's happening."

The store owner has reduced inventories to weather the downturn and so far has been able to avoid cutting his staff of 16 as he waits for sales to pick up again.

Stuchlak's woes are hardly unique in the industry -- once a bright spot in a sputtering U.S. economy. Until recently, the recreational equipment sector was a joy ride that began after the Sept. 11 attacks as Americans sought release from their troubles in family-centered activities close to home. As in the car industry, low-interest financing helped keep sales rolling.

TRIPLE THREAT

With an Iraq war looming, the jobless rate rising and consumer confidence at its weakest in a decade, investors are betting discretionary spending on big-ticket leisure items will suffer, analysts said.

Shares of top manufacturers of recreational gear, such as Harley-Davidson Inc. (HDI) , Polaris Industries Inc. (PII) , Winnebago Industries Inc. (WGO) and Brunswick Corp. (BC) ,are trading at their lowest levels in more than a year.

"I think people are selling discretionary-spending stocks as a function of the fear of war," said Craig Kennison, an analyst at Robert W. Baird & Co. who follows recreational vehicle makers including Forest City, Iowa-based Winnebago. "Consumer confidence is the key for the space."

Consumers have scaled back their spending all along as the economy slowed, but were not worried about losing their jobs until recently, said Richard Edwards, director of investor relations for Polaris, a leading maker of snowmobiles and ATVs based in Minneapolis.

Industrywide sales of ATVs fell 8 percent in January, following a 6 percent rise for all of 2002, said Edwards. Data for February are not yet available.

"People aren't buying in front of the war because they don't know how long it's going to last and what the longer-term impact is going to be. The war is having a negative impact on the overall economy and consumer confidence," Edwards said.

The Recreation Vehicle Industry Association is predicting a slowdown in RV shipments this year after a dramatic rise in 2002.

The RV trade group late last month lowered its 2003 outlook for shipments to dealers to 316,900 units from a previous forecast of 323,000 units. The figure represents a growth rate of 2 percent, down significantly from the 21 percent pace set the prior year.

MOTORBIKE-WEATHER LINK

Registrations of on-highway motorcycles, a closely watched statistic in the motorcycle industry, also slumped in January after posting a slight increase in December, analysts said. They cautioned the data tend to be volatile, and motorcycle sales typically don't rev up until the weather improves.

"January is the slowest month, followed by February, so you have to be careful in implying a trend for the whole year," said leisure stocks analyst Timothy Conder of A.G. Edwards & Sons.

A spokesman for Milwaukee-based Harley-Davidson declined to comment on industry sales trends. The legendary motorcycle maker in January reported record earnings but failed to raise its production estimate for the first time in 16 quarters, rattling investors and sending its stock plunging.

In the boating sector, which has been in a downturn since late 2000, attendance was down at the winter boat shows. Sales of yachts remain soft, but in an encouraging sign, demand for smaller boats is starting to rebound, analysts said.

Sales of small boats are the first to suffer in an economic downturn, and the first to recover when the outlook improves.

Conder said the recreational equipment industry will benefit over the long term from aging baby boomers' increasing focus on leisure and family pursuits.

"As long as consumer income growth remains positive, we think this is one area consumers will continue to spend their money in," he said.

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