Polaris 2014 Annual Report Download - page 37

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We believe that our products are competitively priced and our sales and marketing support programs for
dealers are comparable to those provided by our competitors. Our products compete with many other
recreational products for the discretionary spending of consumers, and to a lesser extent, with other vehicles
designed for utility applications.
Product Safety and Regulation
Safety regulation. The federal government and individual states have promulgated or are considering
promulgating laws and regulations relating to the use and safety of certain of our products. The federal
government is currently the primary regulator of product safety. The Consumer Product Safety Commission
(CPSC) has federal oversight over product safety issues related to snowmobiles and off-road vehicles. The
National Highway Transportation Safety Administration (NHTSA) has federal oversight over product safety
issues related to motorcycles and small vehicles.
In August 2008, the Consumer Product Safety Improvement Act (‘‘Act’’) was passed which, among other
things, required ATV manufacturers and distributors to comply with previously voluntary American National
Standards Institute (ANSI) safety standards developed by the Specialty Vehicle Institute of America (SVIA).
We believe that our products comply with the ANSI/SVIA standards, and we have had an action plan on file
with the CPSC since 1998 regarding safety related issues. The Act also includes a provision which requires the
CPSC to complete an ATV rulemaking process it started in August 2006 regarding the need for safety
standards or increased safety standards for ATVs, which has not yet resulted in the issuance of a final rule.
We are a member of the Recreational Off-Highway Vehicle Association (ROHVA), which was established to
promote the safe and responsible use of side-by-side vehicles also known as Recreational Off-Highway
Vehicles (ROVs), a category that includes our RANGER and RZR side-by-side vehicles. Since early 2008,
ROHVA has been engaged in a comprehensive process for developing a voluntary standard for equipment,
configuration and performance requirements of ROVs through ANSI. Comments on the draft standard were
actively solicited from the CPSC and other stakeholders as part of the ANSI process. The standard, which
addresses stability, occupant retention, and other safety performance criteria, was approved and published by
ANSI in March 2010, revised in 2011, and revised again in 2014.
In October 2009, the CPSC published an advance notice of proposed rulemaking regarding ROV safety under
the Consumer Product Safety Act. In December 2014, the CPSC published a Notice of Proposed Rulemaking
that includes proposed mandatory safety standards for ROVs in the areas of lateral stability, steering and
handling, and occupant retention. Polaris, by itself and through ROHVA, has expressed concerns about the
proposed mandatory standards, whether they would actually reduce ROV incident rates, whether the proposed
tests are repeatable and appropriate for ROVs, and the unintended safety consequences that could result from
them. We are unable to predict the outcome of the CPSC rule-making process or the ultimate impact of any
resulting rules on our business and operating results.
We are a member of the International Snowmobile Manufacturers Association (ISMA), a trade association
formed to promote safety in the manufacture and use of snowmobiles, among other things. ISMA members
include all of the major snowmobile manufacturers. The ISMA members are also members of the Snowmobile
Safety and Certification Committee, which promulgated voluntary sound and safety standards for snowmobiles
that have been adopted as regulations in some states of the United States and in Canada. These standards
require testing and evaluation by an independent testing laboratory. We believe that our snowmobiles have
always complied with safety standards relevant to snowmobiles.
Motorcycle and SVs are subject to federal vehicle safety standards administered by the NHTSA and are also
subject to various state vehicle equipment standards. Our Slingshot vehicle is classified as a motorcycle under
federal law, but may be classified differently in other jurisdictions. We believe our motorcycles (including
Slingshot) and SVs comply with applicable federal and state safety standards.
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