It’s no surprise to any powersports dealer that market pressure, waning consumer confidence, and higher-than-usual inventory levels are weighing on profit margins. While there are many factors outside your control, there are some levers that will have a measurable positive impact. Investing in the right F&I training for your shop, coupled with a focus on customer needs, is your best bet for improving a challenging sales environment.
Manage the Trough and Prepare for Momentum
The National Powersports Auction organization recently released its August report which reflected the month’s combined weight of seasonal dynamics and oversupply of new units. Domestic cruisers were down 2% YoY and nearly 12% versus the previous 90 days, with metric cruisers and sport bikes also showing similar declines. Sport bikes also weakened, falling 3% sequentially and 2.6% YoY, reflecting the overall shift in values of on-road motorcycles. Off-highway categories showed some resilience. ATVs surged 10.7% YoY, even with a modest short-term dip, while personal watercraft (PWC) values climbed 10.4% YoY despite a 5.5% sequential decline.
Historically, August marks the beginning of a trough in pricing, followed by a gradual rebound in Q4. However, dealers are also facing inventory imbalances. These shifts confirm that while some of the weaknesses are seasonal, higher-priced new-unit stock continues to distort wholesale dynamics and weigh on pre-owned values more heavily than in typical cycles. Looking ahead to the next 30 to 90 days, dealers should expect on-road values to remain under pressure until historical patterns suggest stabilization in Q4. Unsold inventory remains more than four times higher than pre-pandemic levels, indicating that OEM promotions will likely persist through year-end, which will put additional pressure on wholesale pricing.
For new units, Lightspeed DMS reported that overall sales increased by 7.1% compared to August 2024, with the Northeast and Northwest posting the highest gains. Service department revenues were also up across all regions, reflecting a positive trend toward a positive Q4.
Target F&I Training Now for a Profitable Q4
The fourth quarter is a busy time of year. You are focused on moving out old units, stocking new units, updating marketing collateral and campaigns, and hopefully dealing with an increase in traffic in your store. It’s easy to forget one of the basic precepts of successful selling – listening to and supporting the customer’s needs.
In this primarily recreational market, innovative sales teams focus on a needs-based approach designed to meet the customer’s goals. Focus your training on understanding your customers’ needs, wants, and goals, and you’ll increase your chances of making the sale.
Ensure your team understands the importance of repeat business – whether for the sale of a new unit or for essential maintenance and service. Building a relationship takes time and should be cultivated through multiple touchpoints. Every person on the team plays a role.
More than any other vehicle, powersports units demand good maintenance habits. Nothing is more disappointing than a planned road trip spoiled by a dead or broken-down unit. Good relationship selling puts consumer protection products front and center – either at the time of sale or on the service drive. Products such as Million Mile Powertrain Protection cover the bike or watercraft for its lifetime. Million Mile Limited Battery Protection will prevent your customers from hearing that dreaded “click, click, click” right when they’re ready to hit the road or trail. And Pre-Paid Maintenance ensures worry-free ownership. These products and more support your customers, differentiate your dealership, deliver valuable revenue at the sale and keep those buyers coming back for service.
Your team is your best asset – even more than those units on the showroom floor. Make sure you end the year on a high note by investing in the right F&I training designed to deliver maximum backend revenue. EFG is here to give you the tools. A $2,500 training investment can yield a 100x return on your powersports training investment. By comparison, a $2,500 training investment in retail automotive F&I trainee can deliver a potential $206,400 in incremental revenue per producer, per year!
Train like you mean it. This month, we are offering a complimentary voucher for an F&I training seat, valued at $2,500*. Learn more about securing your training voucher. Connect with Adam Ouart on LinkedIn, contact him directly at 972-249-7288, or by email at aouart@efgusa.com
*Training Voucher available to franchise dealers only who meet the required unit volume
