Canadians spend billions on ATV/UTV recreation: Study

Canadians spend billions on ATV/UTV recreation: Study | Insurance Business Canada

Canadians spend billions on ATV/UTV recreation: Study
Insurance producers that are not offering any coverage on All-Terrain Vehicles (ATVs) and similar other off-road personal vehicles might change their tune after hearing the results of a recent study, which revealed the immense profit potential of the ATV market.

An independent economic impact study conducted by Smith Gunther Associates Ltd. found that in 2015 Canadians spent $6.9 billion on activities involving ATVs and Recreational Off- Highway Vehicles (ROVs).

“The purpose of the study was to comprehensively determine the economic impact of not only the purchase of ATVs and ROVs but also related economic activities for Canada and each of its provinces and territories,” Canadian Off-Highway Vehicle Distributors Council (COHV) president Bob Ramsay told Powersports Business. “The study encompassed ATV and ROV activities that included riding gear, clothing, insurance and travel related to ATV and ROV use. Together these purchases and activities constitute the direct and indirect expenditures involving ATV and ROV participation.”

According to the study, Gross Domestic Product (GDP) is a better measure of economic activity. National estimates of total direct and indirect GDP is estimated at $4.5 to $5.7 billion, including labor force income of $2.7 to $3.4 billion with related employment measured as 47,929 to 61,213 full time equivalents (FTEs) total including those employed directly, indirectly and in induced activities. These activities generate revenues of $1.5 to $1.9 billion to all levels of government combined in the form of various direct and indirect taxes on goods and services.

The study noted that in 2015, annual investments in the economy - such as new purchases of equipment and machinery, including ATVs, ROVs and related enhancements to vehicles - reached $1.2 billion before depreciation. Additionally, annual operating expenditures totaled an additional $6.7 billion. This brought 2015 direct investment and operating expenditures to $7.9 billion.

With data from Statistics Canada and the COHV’s current and historical data on sales of ATVs and OHVs in each province and territory, it has been suggested that economic multiplier effects are strongest in provinces which are net beneficiaries of interprovincial trade, and where industrial linkages within the province are the strongest. The rural and northern parts of the country, in particular, have been identified as areas with the strongest multipliers.

“Managing the responsible use of ATVs and ROVs is a subject of current interest for many governments. It is also of great interest to the COHV and the not-for-profit rider federations that have developed across the country,” said Ramsay. “This report confirms the scope and scale of the contribution that ATV and ROV use makes to provincial economies. Especially in rural and northern areas, which the industry points out, is an important aspect that needs to be recognized and considered when discussion is focused on the responsible management of off-highway vehicle (OHV) activity across Canada.”

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