There is pending legislation in many states to regulate these bikes. They range from banning them from rail trails to allowing them on the roads with license and registration required. A lot of these kinds of bikes are bought by parents for their kids who are not old enough to drive. Road and trail users are getting sick and tired of these kids riding recklessly around them, and it will be addressed at some point. This action may have put a damper on sales.
The other factor with the massive discounting is that the market is flooded with no-name Chinese manufacturers. You could spend thousands for a bike, break something, and not be able to fix it without significant expense. Most of these bikes are all sold direct to consumer, with no dealer network. When we get one into the shop for service, we charge a lot of money up front to try and fix it, and we may not be able to. I got one in yesterday with a bad rear hub motor. The motor is still made, but I can't buy one. OEM only. Powersports dealers won't touch them, and most bike shops won't either.