Off-road vehicle demand shifts toward utility use after pandemic recreation surge

Off-road vehicle demand is shifting toward utility and land-use equipment after pandemic-era buyers gravitated toward recreational side-by-sides.

During the pandemic, consumers moved away from some higher-priced purchases and bought side-by-sides and other recreational off-road vehicles (ORVs) to use with their families, Jay DuPrey, senior vice president and national indirect lending sales leader at Sheffield Financial, said at the recent Powersports Finance Summit 2026.

Over the past year, however, Sheffield has seen more interest in units used for landscaping, property maintenance and other utility applications, DuPrey said.

Buyers might include landscapers or people using an ORV for a second job, while families are looking for larger side-by-sides with bigger cabs and air conditioning, he said.

“The utility buyer is probably going to be the one that’s leading the marketplace going into 2027,” DuPrey said.

Polaris reported a similar split in its second-quarter retail results, released July 28.

Utility ORV retail sales increased by a low-teens percentage year over year, while recreational ORV retail declined by a mid-teens percentage amid inflation, elevated interest rates and weak consumer confidence, according to the release.

Recreational ORVs tend to be discretionary purchases, while utility units often serve work-related needs, Polaris Chief Executive Mike Speetzen said during the company’s earnings call.

Utility demand shows up in financing

The change in use case is also showing up in financing.

Utility vehicles have become Horsepower Financial Services’ top leased off-road product. The lender expected stronger demand for recreational side-by-sides and ATVs, President and Chief Executive Chris Garrido said during the summit panel.

“These are vehicles, for the most part, that these people need,” he said. “As a former rancher, those UTVs are absolutely vital to my business.”

Horsepower is also seeing increased demand for smaller-displacement utility vehicles and ATVs as buyers seek lower prices, Garrido said. Manufacturers appear to be responding; the push toward increasingly large-displacement models has slowed, he added.

The product shift comes as powersports consumers become more selective about discretionary spending.

Consumers are showing interest in smaller, more price-sensitive units despite KTM’s customer base generally skewing toward higher-income households, KTM Group North America Chief Financial Officer Diane Roth said at the summit.

Although buyers might still be able to pay for a purchase, they are weighing recreational spending against household costs and savings, she said.

Recreational off-road demand has not disappeared entirely, Duprey said.

He said some dealers he visited in some markets in Virginia and West Virginia reported increased recreational sales.

“Some dealers had sales where they were seeing an increase in their dirt bike sales in given regions,” he said. “The regions they were seeing that were typically areas that had more off-road and [competitive] racing.”

This story first appeared on Auto Finance News, a publication of Royal Media.