Power sports get a grip on China's wealthy fun lovers

Staying indoors and playing cards or mahjong are outdated now. Exploring the great outdoors is the new trend among China's new rich.

Bombardier Recreational Products Inc, a Canadian privately held company, has recognized the changing fashion and taken a step into the Chinese market by setting up its first Chinese office in downtown Shanghai.

"BRP is coming to deliver high technology, market-shaping products that are innovative and appealing to the Chinese power-sports community," said Jose Boisjoli, president and chief executive officer of the company.

As a world leader in the design, development, manufacturing, distribution and marketing of motorized recreational vehicles, BRP has a portfolio of brands and products including snowmobiles, watercraft, outboard engines, side-by-side (utility task) vehicles and all-terrain roadsters.

It distributes products in more than 100 countries and has an international headcount of more than 6,000.

"I was told that a group of 15 all-terrain vehicles and side-by-side vehicles left on July 11 for a safari that would take them as far as Inner Mongolia. This is a very exciting thing in such a vast country as China," said Boisjoli.

"In Canada, we know what this means: This is how we built the snowmobile industry 55 years ago."

The market share of Chinese outdoor sporting goods was only around 40 million yuan ($6.3 million) at the end of 2001 but the number soared to 2.6 billion yuan in 2006, with an average growth rate of more than 100 percent.

The sales grew to 8 billion yuan in 2010 and more than 10 billion yuan in 2011. That is why a large number of overseas companies have come to China to look for opportunities while the economy elsewhere is not as promising.

BRP tested the water in the Chinese market as early as 2001. But during the first several years here, there was little market for such power-sports manufacturers. It was not until the last three years that the company really started to take off. BRP has seen its market more than double this year.

Interestingly, the market boomed for BRP in China both at the time of the global financial crisis and again during the European debt crisis.

"The economy in China is aggressive. Meanwhile, we see a combination of a great economy and a very interesting consumer desire, that is, going and trying for new experiences. We think the good combination provides a good reason for us to have more presence. So for certain we see growth in the next five years to 10 years," said Chris Dawson, vice-president and general manager of the international division of BRP.

"For us it is very interesting to watch. There was no market 10 years ago. But now, people are really coming in, asking for the products and giving us ideas for how to make improvement in our products.

"That's when you really start to know that people are really using the products and are getting excited by that. And we start to see the real sense of momentum. When they start to give you feedback, you start to provide even better products," said Dawson.

The opening of BRP's Shanghai operation is the company's move to promote its watercraft, all-terrain and side-by-side vehicles.

BRP looked at the motorcycle market in China and saw it is starting to grow. Different manufacturers have started to see an increase in sales. There is always a group of people who would like to go for outdoor experiences but they don't want to take risks. They want to have fun.

The company says it started slowly and built up over time. BRP has a very long-range view on this, said Dawson.

Concern over users' safety is one of the reasons for opening a Shanghai operation.

For BRP, the goal is, with whichever market it enters, it will make sure that distributors, dealers and ultimately consumers know how to use the products and how to be safe with them.

With the Shanghai office, dealers will be easily approachable for safety instructions and any other help related to the use of the company's products.

The Can-Am Spyder motorcycle has a unique and solid "masculine" look and costs about the same as a Harley-Davidson motorcycle. They embody much of the on-the-road spirit and are also appropriate for use by police or border-guards, on and off the road.

Although still awaiting certification from local authorities, BRP has displayed the roadsters at shows over the last few years, garnering a lot of interest.

"We see a mixture of different consumers, business people and professionals. We also have enthusiasts who have a real passion for this sport. They want to join and spend on this, no matter whether they have a lot of money or not," said Dawson.

However, be it roadsters, snowmobiles or watercraft, each is fairly expensive and less accessible to ordinary customers. The sports are regarded as "luxury" outdoor activities.

"I never know how to interpret the word 'luxury'. Yes it is a luxury lifestyle. Someone may think that these are things to show off with. But, on the other hand, it actually brings to you inner happiness, that is, you have a chance to go and see different wildlife and get a chance to experience something new. It's indulgent, fun-factor - and I guess that part is expected to be somewhat of a luxury," said Dawson.

"It's getting people out and getting people excited," he added.

Luxury or not, government officials see this new outlet as proof of the two countries strengthening their business ties.

China is now Canada's second largest two-way trading partner after the United States. In 2011, two-way trade between Canada and China amounted to almost 65 billion Canadian dollars ($64.67 billion). There are more than 220 Canadian companies with a presence in the Yangtze River Delta at present.

"China is one of the fastest growing regions in the world and presents many business opportunities for Canadian suppliers regarding a variety of goods and services. The steady rise in the average standard of living, the expanding middle class with increasingly larger disposable incomes - all mean opportunities for consumer goods," said Rick Savone, consul general of Canada

In particular, there's an increasing portion of the Chinese population that has acquired not only the means to indulge in high-end products but also the opportunity and leisure time to enjoy them.

The government of Canada is committed to supporting companies such as BRP in their endeavors in the China market, said Savone.

shijing@chinadaily.com.cn

(China Daily 08/06/2012 page13)