cat partners with piaggio cycle group

March 6, 2006 - Just prior to its dealer meetings this week, Arctic Cat has announced its partnering with an Italian motorcycle group to distribute ATVs and motorcycles in North America and Europe.

Cat says it will work with the Piaggio group - maker of Aprilia, MotoGuzzi, Derbi, Piaggio, Vespa and Gilera brands - to further distribute those brands in North America and Cat's products in Europe.

For The Piaggio group the partnership means new points of purchase for their motorcycles, scooters and other vehicles in Cat dealerships here. Arctic Cat will have the opportunity to sell their ATVs in Piaggio's dealerships across Europe.

"For us this is mainly a chance to make more inroads into an expanding European ATV market," said Kale Wainer, Arctic Cat's public relations director. "There are no formal plans for sharing of engineering expertise between the two firms currently, but there is certainly future potential," he added.

Cat dispelled rumors of plans to enter the motorcycle market following this merger and told AmSnow this move simply gives dealers on both sides more options of vehicles to sell and strengthens both firms' footholds in new markets. However, European dealers will not be selling snowmobiles.

The move gives Cat valuable outlets for their growing ATV business in a rapidly expanding European market.

Cat isn't alone in that quest. Late last year Polaris linked up with Austria's KTM Power Sports AG (Europe's No. 2 motorcycle maker) at a cost of $80 million to gain access to overseas markets and manufacturing plants.

Both that deal and the current one involving Cat have the potential for each side to share technology in the long term, but appear to be immediately more beneficial to each firm's bottom line by offering more ATV and cycle sales opportunities.