The first product will be introduced within the next two years, followed by a rollout across all of its product lines within five years, the Valcourt, Que.-based company said Thursday when it reported fourth-quarter earnings. The technology will be developed in-house based on BRP’s Rotax modular electric powerpack, with teams in Austria and Quebec working on different aspects of the vehicles.
BRP currently builds off-road vehicles, snowmobiles, personal watercraft and three-wheeled motorcycles that are all gasoline-powered, chiefly at factories in Canada and Mexico. It is also getting back into boat manufacturing.
“The whole strategy [surrounding] electrification is to attract a new set of customers,” BRP chief executive officer José Boisjoli said. “There is definitely a market for it.”
BRP has previously stated its intention to offer battery-powered models to customers but Thursday’s announcement brings its plans into sharper focus and marks the first time it has said how much it would invest in the endeavour. The company is the first major powersports manufacturer to commit to offering electric vehicles across its full lineup within a specific timeframe, according to Mr. Boisjoli.
One big question is how strong demand for all-electric vehicles will be and how much that demand will eat into sales of BRP’s existing models. The company has surveyed consumers multiple times in recent years and found that although the overwhelming majority expressed interest in electric versions of powersports vehicles, that interest ebbed when they were asked whether they were prepared to pay more for an electric model or accept one that has a lower distance range.
Hunters going on long trips in the woods are less likely to be customers for electric vehicles because of limited charging infrastructure along the way, but cottagers on lakes that have restrictions on motorized watercraft may be very interested, Mr. Boisjoli said in an interview. BRP will offer electric models with different capabilities and price points within product segments, he said.
“It will be an evolution,” Mr. Boisjoli said. He said BRP estimates electric vehicles could eventually make up between 10 and 20 per cent of its overall volumes. Any move by governments to impose tighter environmental regulations on the industry, like many of them have done for the auto sector, would influence volumes, he said.
BRP is pushing into electric vehicles just as a crop of new rivals also hopes to crack the market. Among them is Montreal-based Taiga Motors Inc., which plans to go public later this year. Taiga’s backers include a $100-million investment from a group led by Northern Private Capital, a Toronto-based private-equity fund founded by Nova Scotia billionaire John Risley.
BRP’s current manufacturing system sometimes uses a common set of vehicle parts in a variety of models, an idea it borrowed from German automakers such as Volkswagen Group. For example, its Rotax 900 ACE combustion engine can be found in snowmobile, watercraft and off-road models. The company plans to adopt the same approach in manufacturing its all-electric offerings.
BRP reported profit of $264.2-million, or $2.95 a share, on revenue of $1.8-billion for its latest quarter as the company continues to benefit from a surge in demand from people spending on leisure closer to home during the COVID-19 pandemic. It is forecasting revenue growth of between 25 per cent and 30 per cent for its current fiscal year compared with the year just ended.
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