[Research Report] The off-road vehicle market is expected to grow from US$ 22.78 billion in 2022 to US$ 33.39 billion by 2030; it is estimated to grow at a CAGR of 4.9% from 2022 to 2030.

Analyst Perspective:

The off-road vehicle market is driven by rising consumers' disposable income with the surge in outdoor recreational activities among individuals around the globe. Off-road vehicles are used for performing various recreational activities, including traveling, trail riding, sports, and among others. Also, rising demand for all-terrain vehicles for agriculture and gardening purposes is driving the global off-road vehicles market. All-terrain vehicles are used in agriculture & gardening for performing several activities, including field plowing, lawn mowing, and seed spreading. The growing availability and popularity of off-road vehicles among farmers and traveling enthusiasts is the major driving factor for the market growth.

Off-road traveling is growing popular among people, with rising outdoor spending in developed countries, including the United States, Canada, Germany, and France. Globally, there have been established offroad community groups that participate in the events, trips, meet-ups, and among others.

However, the high cost of manufacturing and higher pricing of these vehicles hinder market growth. The increasing popularity of adventure sports activities and the surge in spending on recreational activities are expected to drive the global off-road vehicle market. According to the U.S. Bureau Analysis, the outdoor recreational activities spending for all 50 states in the United States accounted for US$ 454.0 billion, which is 1.9% of its gross domestic product (GDP) in 2021. Increased consumer preference for adventure tourism, post-COVID-19 pandemic, is propelling the global market growth. Recreational activities spending has significantly increased owing to people’s desire for outdoor traveling in the safe, and rising demand for entertainment options is driving the market growth. Rising outdoor activities such as hiking, trailing, and off-roading traveling are the major tourism activities spent by consumers.

However, increased demand for battery-operated electric off-road vehicles for recreational activities is expected to propel the market growth.  Also, the major players in the global market are developing and launching new electric vehicle models for off-road traveling. For instance, in April 2023, Toyota Motor Corporation planned to launch around ten new battery-powered electric vehicle models by 2026. For this, the company planned to set up a new factory for the battery EVs. John Deere, the agricultural and farm equipment manufacturer, launched utility task vehicle models for farming applications. The company planned to launch various models of utility vehicles for agriculture purposes owing to increased demand by farming customers. In July 2022, John Deere Company launched an Autocracy automated assistance-based steering system for its utility task vehicles. This steering system was created to help farmers to be more productive with less effort.

Off-road vehicles are used for several applications, including carrying goods, farming, and the adventurous activities of traveling. Recently, electric offroad vehicles have gained popularity owing to rising demand for fuel-efficient operations with increased noise reduction levels. However, the use of off-road vehicles requires strict government policies, rules and regulations for improved safety, hindering the market growth.

The rising trend of outdoor recreational activities and surge in consumer spending on adventurous sports and outdoor trips across European countries is expected to drive the market growth. According to the European Union Organization Report in 2021, EU countries residents spent more than US$ 307.06 billion on tourism trips, with around 62% on domestic adventurous trips. Several outdoor activities are using all-terrain vehicles and utility task vehicles for traveling in Europe, which is projected to create lucrative opportunity for market growth during the forecast period.

Market Overview:

Off-road vehicles are vehicles with the capability to drive on paved, gravel, and rough surfaces. These vehicles consist of flexible suspension systems with high ground clearance and are commonly used on rough roads. Rising penetration and launching of all-wheel drive and four-wheel drive vehicles for consumers around the globe is driving the demand for the global off-road vehicles market. For instance, in July 2023, The Maruti Suzuki automotive manufacturer launched Jimny off-road sport utility vehicle (SUV). This SUV is launched with four-wheel drive and is equipped with 4X4 technology.

Moreover, off-road vehicle original equipment manufacturers are developing and launching advanced power-assisted drive systems to meet the changing consumer's requirements. Furthermore, the demand of the end-users shifted towards more comfortable driving systems, which is propelling the market growth. For instance, in August 2023, Toyota Motor Corporation launched a "250" Series Land Cruiser. This land cruiser launched with advanced features for off-road traveling that allow people to travel safely from remote locations.

Strategic Insights

Market Driver:

Increasing Spending on the Outdoor Recreational Activities with Surge in the Disposable Income is Driving the Market Growth

Rising consumer spending on outdoor recreational activities with increasing disposable income around the globe is a major driving factor for the off-road vehicle market. Rising consumers spending on the mobility sector with the rapid evolution in terms of technologies in the automotive sector drives the market growth. Hence, to meet the consumers' changing demands, the key players are launching a cost-effective and fuel-efficient transportation system. For instance, in March 2021, Polaris, Inc. launched an electric RANGER utility task vehicle. This off-road vehicle was developed by partnering with Zero Motorcycles. Such increased demand for off-road electric vehicles with government support and funding is expected to create ample opportunity for market growth. For instance, the US Department of Transportation launched the Federal Highway Administration NEVI Formula Program to provide the funding to deploy electric vehicle charging stations.

Off-road vehicles have gained popularity across North America and European countries owing to increasing consumer spending on outdoor sports activities. However, off-road vehicles are widely used in various sectors, including mining, agriculture, construction, sports, and many other sectors. Additionally, the high cost of the vehicles, high fuel requirements, and high capital investments hinder the growth of the off-road vehicles market.

The technological developments in off-road vehicles, with the emergence of electric drive systems and power train capabilities, are expected to create ample opportunity for market growth. Rising concerns regarding carbon emissions and the increasing popularity of electric-based off-road vehicles are expected to create ample opportunity for the global off-road vehicle market growth.

Segmental Analysis:

Based on vehicle type, the market is segmented into all-terrain vehicles (ATVs), utility task vehicles (UTV), and snowmobiles. Among these, the all-terrain vehicle (ATV) segment held the largest share of the market in 2022. In contrast, the utility task vehicle segment is anticipated to register the highest CAGR in the market during the forecast period. The all-terrain vehicle segment consists of the vehicles used for military, agriculture and outdoor sports events. Rising investments across the military and agriculture development are expected to drive the global off-road traffic market. Also, the utility task vehicles segment is growing at a highest CAGR during the forecast period owing to increasing demand for this vehicle from various country's municipal corporations. The rising growth of low-carbon-emission vehicles is driving the market growth. 

Regional Analysis:

The North American off-road vehicle market is expected to dominate the global off-road vehicle market. This is primarily owing to the rising popularity of outdoor sports activities around the globe. Also, the rising disposable income of the people, with the increasing focus on the popularity of high-end vehicles, is expected to create ample opportunity for market growth. Also, continuos development of the advanced vehicles with electric assistance and new models in the market with advanced technologies drives the market growth. In February 2023, Bombardier Recreational Products (BRP) launched snowmobiles and planned its production in 2024 at its Valcourt plant in the US. The company launched an electric Ski-Doo two-passenger snowmobile.

Asia Pacific is growing with the highest CAGR during the forecast period owing to increasing investments, rising development and the launching of new off-road vehicle models in this region. 

For instance, the companies are launching all-terrain vehicles with advanced technologies in order to meet the consumer’s demand. For instance, in August 2022, Polaris, Inc. launched all new models of RZR Pro R Sports all-terrain vehicle in India. This all-terrain vehicle is used for various off-road applications, including farming and traveling on the off-roads, including in private properties.

Key Player Analysis:

The off-road vehicle market analysis consists of players such as Deere & Company, DRR USA, Electra Meccanica, Harley-Davison, Inc., Yamaha Motor Co., Ltd., Honda Motor Co., Ltd.,   Italika, Kawasaki Heavy Industries, Kymco, and Polaris Inc. are the top two players owing to the diversified product portfolio offered.

Recent Developments: 

The strategies adopted by the key players in the market include partnerships, mergers, acquisitions, collaborations and new off-road vehicles launching in the market. A few recent key market developments are listed below: 

• In August 2023, BYD Company Ltd. launched an off-road SUVs named BAO 5 under its Fangchengbao brand. The Dual Mode Off-road vehicle with Super Hybrid Platform consists of several features, including Cell to Chassis technologies, balancing between the vehicle’s safety, powerful off-roading, and low energy consumption.
• In July 2023, Kawasaki Heavy Industries, a Japan-based automotive company, launched the off-road bike model KLX230RS for the Indian market. This off-road vehicle consists of legal road permits and consists of several components, including turn indicators, headlights, rear-view & front view mirrors, and taillights.
• In June 2023, Lexus GX launched a luxurious quality off-road Sport Utility vehicle globally for premium users in the North American market.  
• In September 2022, Suzuki Motor USA LLC launched KingQuad's all-terrain vehicles product portfolio. It consists of the front suspension, fully I-beam & A-arm rear suspension.

REGIONAL FRAMEWORK

Off-Road Vehicle Market Report Analysis

MARKET PLAYERS

Off-Road Vehicle Market Report Scope

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