RV sales show signs of renewed life

MARYSVILLE — According to figures released this summer by the Recreational Vehicle Industry Association, hope has returned to the recreational vehicle market. It is welcome news for the many companies that were hit hard by the lingering recession.

An estimated 53 percent of the RV industry's work force has been laid off since June 2007. Perhaps hardest hit was Elkhart, Ind., where 60 percent of RVs are manufactured in the U.S. The city was even forced to cancel its own annual RV show in 2009 because business and the economy were so bad.

But now, just in time for the RV industry's 100th anniversary celebrations, things are finally turning around.

“Last month we had one of our best months for the RV industry since Roy Robinson started selling motor homes,” said David Madsen, a manager at Roy Robinson RV in Marysville.

Nationwide, overall figures show that the number of RV units shipped to dealers in the first six months of 2010 is up 87.1 percent over the same period in 2009. It is heartening news for a hard-hit industry.

The recession wasn't the only factor that had impacted the RV market. According to Rick Nevin, sales manager at Clear Creek RV Center in Silverdale, high gas prices just before the recession took hold had already made a mark.

While a study by PKF Consulting, a firm that tracks trends in the hospitality industry, suggested that fluctuations in fuel prices are not enough to actually affect whether a family takes an RV vacation or not, figures show people have been camping closer to home and a trend toward buying smaller, more fuel-efficient RVs was in play.

For the last few years, oversized luxury fifth-wheels and motor homes were passed over by consumers for smaller units that were easier to tow or drive. However, that trend now seems to be turning around.

“People are starting to go bigger again,” Nevin said. “Before the recession we had some high gas costs and it seemed like the smaller, the better. But now we seem to be getting a lot of the little stuff in on trade as people get into the bigger stuff again.”

Madsen concurred that luxury unit sales had been slow at Roy Robinson but they, too, are starting to see a turnaround for those specialty units.

Robin Brigge, manager at Blade RV Center in Mount Vernon, has noticed that price factors into a lot of current consumer purchases.

“It's 90 percent price-driven right now,” he said.

In fact, more affordable used RV sales seem to be the strongest. Both Madsen and Nevin acknowledge that used RV sales are up.

“I would say that the used market has always been stronger than the new market,” Madsen said. “But recently I would say that I see about a 25 percent increase in the used market over the new.”

Brigge has also noticed that consumers who exercised caution about large purchases during the worst of the recession are now beginning to buy once more.

“People who have had the ability to buy in the last couple of years that didn't buy, those are the people that are buying right now,” Brigge said.

But as consumers return to dealers' lots, they are finding that things aren't quite what they were before the economic slowdown. Something that has changed significantly since the recession began is financing. It used to be fairly easy to obtain credit, often at great rates, when purchasing an RV. No more.

“Financing has changed quite a bit,” Nevin said. “Zero-down loans are almost nonexistent.”

Brigge added that he has even seen a few customers come in to buy with financing already in place. The consumers have done their homework and already shopped for and obtained the best loan before they step on to the lot.

But, Brigge said, there are still a large number of customers who come in expecting to find the easy financing and great terms of the past and are surprised to find that banks aren't as liberal as they once were.

Locally, Roy Robinson RV, Clear Creek RV Center and Blade RV Center are among the lucky dealerships that survived the recession due to their longevity, good reputation and busy service departments. Some competitors were not so lucky. Other big dealers, such as Poulsbo RV, survived but had to close branches to stay afloat.

But even as they breathe a sigh of relief, local dealerships are still waiting to see what happens next.

“Obviously we're coming to the end of the season here and we'll be curious to see whether things drop off lower than what they were in prior years or whether it's going to be better than average,” Madsen said.

The Recreational Vehicle Industry Association has already predicted that 2011 shipments will increase 8.4 percent over the projected and not yet realized totals for 2010.

Although the RVIA acknowledges that the lingering effects of the recession could continue to slow the industry, they are banking on RVs' appeal to families and believe that RV sales will also benefit as aging baby-boomers enter the age range in which RV ownership is highest.