Polaris Industries Inc. reported a 10% year-over-year increase to $1.1 million in volume of revolving and installment credit contracts written in 2016, according to the company’s 2016 annual report.
Consumers financed approximately 33% of Polaris’ vehicle sales in 2016 through the company’s combined retail finance arrangements with Performance Finance, Sheffield Financial, and Synchrony Bank.
Polaris inked a deal with FreedomRoad Financial in September 2016 to launch Performance Finance, and the arrangement is set to expire in December 2021, according to the report.
Also in September, Polaris terminated its agreement with Chrome Capital, following the powersport lessor’s halt in accepting new lease applications. The OEM’s partnership with Sheffield will expire February 2021, and with Synchrony in December 2020.
While retail finance was up, wholesale finance volume dropped for Polaris. The manufacturer’s floorplan financer Polaris Acceptance (PA) saw an 8% year-over-year decrease in wholesale receivables from U.S. dealers, including securitized receivables, to $1.2 billion.
PA is a joint venture between Commercial Distribution Finance (CDF) and Polaris Industries Inc. which provides floorplan financing to Polaris dealers. The partnership is set to expire in February 2022.
The amount financed by worldwide dealers under PA was also down 8% year over year to $1.4 million in 2016. However, credit losses “have been modest,” averaging less than 1% of the PA portfolio, the report said.
Back in January, Medina, Minn.-based Polaris announced the winding down of its Victory Motorcycles brand after 18 years of investing in the motorcycles — and cumulative losses exceeding $100 million. The closing is not expected to alter any financing arrangements Polaris currently has, Director of Investor Relations Richard Edwards previously told Powersports Finance.
“I have often said that neither Polaris nor any of our businesses will grow to the moon. We do not wish for industry downturns, but we expect and plan for them, along with some self-inflicted deviations that can flatten our growth trajectory.”
— Scott Wine, Chairman and Chief Executive, Polaris Industries Inc.
The decision to close the Victory brand was “emotionally difficult” but “undeniably the right thing to do,” Wine said in the report. “We are winding down Victory to devote our full resources and focus towards spurring the growth of our Indian and Slingshot brands,” he added.