BRP Inc., known for its snowmobiles and other recreational vehicles, is making a bold return to the motorcycle market after nearly four decades—this time with an electrified twist. With rising global interest in electric vehicles (EVs), BRP’s CEO, José Boisjoli, believes this is an opportunity the company can’t afford to miss. However, the real question is whether consumers are ready to pay the premium for these new e-motorcycles.
At a recent dealer event, Boisjoli introduced BRP’s Can-Am Pulse street bike and Can-Am Origin adventure bike, both electric, with prices ranging from $14,000 to $16,500. These models, however, come with a price tag that is 20% to 50% higher than traditional gas-powered motorcycles from competitors like Honda and Kawasaki. Even Harley-Davidson’s LiveWire S2 Del Mar, priced at $15,500, offers slightly more range and horsepower than BRP’s electric bikes, which deliver a range of 90 to 100 miles.
Despite the challenges, the electric two-wheeler market is growing. However, much of this growth is driven by smaller, more affordable scooters and mopeds. E-motorcycles face higher production costs due to the need for larger batteries, which slow down adoption. As companies search for battery technology that provides decent range without inflating costs, BRP remains confident that its offering fits into a rising market segment. But as Ducati CEO Jason Chinnock pointed out earlier in 2023, “The battery technology really isn’t there yet,” which may explain why some competitors are hesitant to jump into the e-motorcycle market too soon.
Inventory Headwinds
BRP’s foray into electric motorcycles isn’t just a long-term bet; it’s also part of a broader strategy to address near-term headwinds. The company, which was spun off from Bombardier Inc. with backing from Bain Capital, recently lowered its earnings forecast as it grapples with higher-than-expected inventory levels. Revenue is projected at C$7.8 billion to C$8 billion this fiscal year, down from C$10.4 billion the previous year. Promotional activities in the powersports industry are squeezing profit margins, making profitability more elusive.
Consumer appetite for electric vehicles remains lukewarm, despite BRP’s surveys showing initial interest rates of 85% to 90%. When potential buyers were informed about the drawbacks—higher costs, heavier bikes, and limited range—enthusiasm dropped sharply to just 10% to 15%. The key obstacle remains battery range. Many experts agree that for e-motorcycles to become mainstream, they must offer more than 125 miles per charge. As it stands, the Can-Am bikes fall short of that, offering between 90 and 100 miles on a single charge.
The Quiet Revolution
Despite the hurdles, BRP is banking on a unique selling point: the quiet ride. The Can-Am bikes utilize an enclosed chain system that significantly reduces noise compared to traditional motorcycles. “When you’re on the trail or road without the engine noise, you’re more connected to your surroundings,” Boisjoli said, highlighting the experiential benefits that could appeal to adventure seekers and environmentalists alike.
The Can-Am brand also brings a nostalgic advantage. In the 1970s, Can-Am quickly rose to fame in the motocross world, creating a legacy that still resonates with many riders today. This brand recognition may give BRP an edge as it reenters the motorcycle market.
But motorcycles are just one piece of BRP’s electrification plan. The company has already launched electric snowmobiles, although sales have been sluggish. “Are we happy with the volume in year two? No,” Boisjoli admitted, blaming the poor winter season, which impacted both electric and gas-powered snowmobiles.
By 2026, BRP plans to electrify its entire lineup of powersports vehicles, including all-terrain vehicles (ATVs) and watercraft. Unlike many competitors, BRP manufactures most of its EV components in-house, which provides greater flexibility in design and potential cost savings down the road.
Analysis: The Market Opportunity and Risks
The electric motorcycle market, while still in its infancy, presents a potentially lucrative opportunity for BRP if the company can solve the range and cost challenges. As electric vehicle adoption accelerates worldwide, consumers may start to view e-motorcycles as a viable alternative to gas-powered models, particularly if battery technology improves and prices come down.
For investors, BRP’s diversification into electric motorcycles is a high-risk, high-reward strategy. While the short-term financial outlook is clouded by inventory issues and shrinking margins, the long-term potential for BRP’s electric portfolio could provide substantial upside, especially as the global push toward sustainable mobility intensifies. If BRP can leverage its brand equity, and the technological advancements in battery systems materialize, the company could carve out a strong position in the emerging e-motorcycle space.
However, risks remain. If electric motorcycles fail to gain traction with consumers or if battery innovations lag, BRP could face prolonged challenges in recouping its investment in the electrification of its product lineup.
