Arctic Cat owner stopping all production, could sell the Minnesota snowmobile and ATV maker

The owner of Arctic Cat says it is suspending production at plants in Thief River Falls, Minn., and St. Cloud as the company seeks alternatives for its powersports operations.

Rhode Island-based Textron Inc., an industrial conglomerate that owns aviation and defense companies, bought Arctic Cat in January 2017 for $247 million. Arctic Cat became part of Textron’s Industrial segment, which includes other Textron Specialized Vehicles like E-Z-Go golf carts, Cushman utility vehicles and Jacobsen mowers.

In a filing with the Securities and Exchange Commission on Wednesday Textron said it was seeking strategic alternatives for Arctic Cat, which is based in Thief River Falls and makes snowmobiles, ATVs and other outdoor vehicles.

“The consumer end market demand for powersports products continues to remain soft,” the company wrote.

The powersports industry, which includes personal watercraft, snowmobiles and all-terrain and utility vehicles, has struggled lately as consumers delay big purchases that often require financing. Medina-based Polaris Inc., the largest powersports manufacturer, said during its third quarter earnings in October that it was limiting production to protect inventory levels at its dealers.

In November, Textron announced it had laid off 65 Arctic Cat employees in Thief River Falls and planned to suspend snowmobile production in the first half of 2025. Now “production will be indefinitely suspended for all product lines sometime in the first half of 2025,” a Textron spokesperson said in an email.

Some workers will return at the start of the new year to complete limited production runs tied to existing customer orders, so an exact date when all production will cease has not been determined.

Textron said employees who work through their completion dates will be offered severance.

The company will take a charge of $30 million to $40 million to write down the production-related powersports inventory, according to the SEC filing.

Arctic Cat employs about 530 workers at its Thief River Falls plant and about 30 at its St. Cloud engine manufacturing facility.

In a filing with the SEC on Thursday, Polaris said it has amended some of its credit agreements, including increasing the amount of its revolving line of credit and extending some maturity dates.

After Yamaha announced in June 2023 that it was leaving the snowmobile business, three main producers remained in the powersports category: Polaris, Arctic Cat and Canada-based BRP Inc., which makes Ski-Doo and Lynx snowmobiles.