Sell the Legend, Keep the Profits: Polaris Gets Back to the Dirt
Because What’s More American Than Private Equity?
by paul forrest
Wednesday, October 22, 2025
On October 13th, Polaris announced its intention to separate Indian Motorcycle into a stand-a-lone company. Private Equity firm Carolwood LP will be the new owner sometime in the first quarter of 2026. The new CEO will be Mike Kennedy, a 26-year veteran of arch-rival Harley Davidson. Polaris acquired the Indian brand in 2011 from Stellican Limited, a British private equity firm. New Indian motorcycles started rolling down the assembly line in Spirit Lake Iowa in 2013. Interesting that Indian once again is going back to Private Equity ownership.
Let's take a brief look into Polaris's eighty-nine-page 2024 Annual Report to look for clues as to why Indian is being sold. Polaris has three primary sales categories: Off-Road (Polaris), On-Road (Indian, Slingshot), and Marine (Bennington, Godfrey, Hurricane).
Total sales revenue, including road, off-road, and marine products was down by 20% in 2024 for Polaris compared to 2023. Of the $7.2 Billion in total company revenue (sales), 14% or $988 million came from Indian Motorcycles. The bulk of Polaris's 2024 revenue comes from off-road vehicles (side-by-side & ATV), which are not part of Indian Motorcycles. The $5.7 billion in off-road vehicle sales in 2024 represents 79% of Polaris annual revenue. Only $481 million comes from Marine sales.
Looking at the first two quarters in 2025, the trend continues. Q1 overall sales for Polaris are down 12%. Q2 sales are down 6%.
The significant sales decline in 2024 had a direct impact on company profitability. Total Company gross profit in 2024 was $1.46 billion, down almost $500 million from the roughly $2 billion earned in 2023. Net profit in 2024 was $111 million. Off-Road vehicles were the primary drivers of profit in both years, delivering 80% of total profit in 2024.
Polaris holds the #1 market share in North America ORV sales, with 1400 dealers in North America. Looking at their website, there is a huge selection of 111 ORVs in their lineup, a vehicle to meet any need.
Polaris includes two charts that shows their internally generated estimates of total North American and Worldwide ORV (Off-Road Vehicle) industry sales. Some interesting facts spring immediately from these charts. The first key fact is that the ORV market is predominantly a North America fascination. Of the approximately 960,000 worldwide ORV unit sales in 2024, 84% of these units are sold in North America.
The 2nd key fact is that the market for ORVs is holding steady, with approximately the same number of units being sold in each of the last three years.
Motorcycle sales show a different story. Indian holds the #2 position in the North America 900cc engine size and larger cruiser/touring category. Indian is the perennial #2 player to Harley-Davidson. Unlike ORVs, motorcycle sales in this category are declining. Polaris estimates worldwide sales of 280,000 units in 2024, compared to 300,000 units sold in 2023, and 315,000 sold in 2022. That represents an 11% decline is just two years.
Polaris is categorized as a "Mid-Cap" stock market company. An investor who purchased $100 of Polaris stock on 12/31/2019 would have only $64.40 five years later on 12/31/2024. That same $100 invested in a diversified Mid-Cap 400 Index fund would have grown in 5 years to $163.54. Said differently, investing in Polaris would have lost 35% in 5 years. Investing in a Mid-Cap Index fund would have gained 63.5%.
Investing that same $100 into the S&P 500 Index would have grown to $172.
Also, let's take a look at the Polaris stock price once the sale of Indian was announced on October 13.
The stock opened a $57.54 on 10/13. By market close on 10/14, the stock closed at $69.90, for a gain of 21.2%!
Clearly the market has voiced its approval, for now, on the sale of Indian to Private Equity.
Imagine being part of Polaris Management, or on the Polaris Board of Directors, watching your stock price drop in a rising market, seeing your profits drop significantly, and now being told by your own Accounting Department that Tariffs will cost an estimated additional expense of $120-$130 million in 2025. Polaris net profits in 2024 totaled $111 million. Tariff expense could wipe out any profit potential in 2025.
What to do? Stay the course or focus more on your core competency and profit driver of Off-Road Vehicles? Shifting sales to overseas markets is not immediate option as 80 plus percent of your sales comes from North America. Being the consistent #2 player to Harley in a shrinking large cruiser market is not appealing. Being the consistent #1 market leader in ORVs, a very profitable business, without the headwinds of carrying along the Indian motorcycle division, might be the only viable option.
Of course, the biggest question for those who follow racing is how the new owners of Indian will feel about spending between $6–$12 million a season going Bagger racing and supporting the MotoAmerica series. Private equity guys love racing right up until someone reminds them it doesn’t come with a dividend. They’re not enthusiasts — they’re capitalists.
Let's take a brief look into Polaris's eighty-nine-page 2024 Annual Report to look for clues as to why Indian is being sold. Polaris has three primary sales categories: Off-Road (Polaris), On-Road (Indian, Slingshot), and Marine (Bennington, Godfrey, Hurricane).
1: Total Company Sales and Profits are Down.
Total sales revenue, including road, off-road, and marine products was down by 20% in 2024 for Polaris compared to 2023. Of the $7.2 Billion in total company revenue (sales), 14% or $988 million came from Indian Motorcycles. The bulk of Polaris's 2024 revenue comes from off-road vehicles (side-by-side & ATV), which are not part of Indian Motorcycles. The $5.7 billion in off-road vehicle sales in 2024 represents 79% of Polaris annual revenue. Only $481 million comes from Marine sales.
Of course, the biggest question for those who follow racing is how the new owners of Indian will feel about spending between $6–$12 million a season going Bagger racing and supporting the MotoAmerica series. Private equity guys love racing right up until someone reminds them it doesn’t come with a dividend. They’re not enthusiasts — they’re capitalists.
The significant sales decline in 2024 had a direct impact on company profitability. Total Company gross profit in 2024 was $1.46 billion, down almost $500 million from the roughly $2 billion earned in 2023. Net profit in 2024 was $111 million. Off-Road vehicles were the primary drivers of profit in both years, delivering 80% of total profit in 2024.
2: Cruiser Sales are Declining; Off-Road Vehicles are Holding Steady.
Polaris holds the #1 market share in North America ORV sales, with 1400 dealers in North America. Looking at their website, there is a huge selection of 111 ORVs in their lineup, a vehicle to meet any need.
Polaris includes two charts that shows their internally generated estimates of total North American and Worldwide ORV (Off-Road Vehicle) industry sales. Some interesting facts spring immediately from these charts. The first key fact is that the ORV market is predominantly a North America fascination. Of the approximately 960,000 worldwide ORV unit sales in 2024, 84% of these units are sold in North America.
The 2nd key fact is that the market for ORVs is holding steady, with approximately the same number of units being sold in each of the last three years.
Motorcycle sales show a different story. Indian holds the #2 position in the North America 900cc engine size and larger cruiser/touring category. Indian is the perennial #2 player to Harley-Davidson. Unlike ORVs, motorcycle sales in this category are declining. Polaris estimates worldwide sales of 280,000 units in 2024, compared to 300,000 units sold in 2023, and 315,000 sold in 2022. That represents an 11% decline is just two years.
3: Polaris Stock Price was in a Free Fall in an Overall Rising Market.
Polaris is categorized as a "Mid-Cap" stock market company. An investor who purchased $100 of Polaris stock on 12/31/2019 would have only $64.40 five years later on 12/31/2024. That same $100 invested in a diversified Mid-Cap 400 Index fund would have grown in 5 years to $163.54. Said differently, investing in Polaris would have lost 35% in 5 years. Investing in a Mid-Cap Index fund would have gained 63.5%.
Investing that same $100 into the S&P 500 Index would have grown to $172.
Also, let's take a look at the Polaris stock price once the sale of Indian was announced on October 13.
The stock opened a $57.54 on 10/13. By market close on 10/14, the stock closed at $69.90, for a gain of 21.2%!
Clearly the market has voiced its approval, for now, on the sale of Indian to Private Equity.
Conclusion:
Imagine being part of Polaris Management, or on the Polaris Board of Directors, watching your stock price drop in a rising market, seeing your profits drop significantly, and now being told by your own Accounting Department that Tariffs will cost an estimated additional expense of $120-$130 million in 2025. Polaris net profits in 2024 totaled $111 million. Tariff expense could wipe out any profit potential in 2025.
What to do? Stay the course or focus more on your core competency and profit driver of Off-Road Vehicles? Shifting sales to overseas markets is not immediate option as 80 plus percent of your sales comes from North America. Being the consistent #2 player to Harley in a shrinking large cruiser market is not appealing. Being the consistent #1 market leader in ORVs, a very profitable business, without the headwinds of carrying along the Indian motorcycle division, might be the only viable option.
Of course, the biggest question for those who follow racing is how the new owners of Indian will feel about spending between $6–$12 million a season going Bagger racing and supporting the MotoAmerica series. Private equity guys love racing right up until someone reminds them it doesn’t come with a dividend. They’re not enthusiasts — they’re capitalists.
— ends —
