Associated Press
LOUISVILLE, Ky. — RV manufacturers expect to pass another milestone in their steady recovery from the recession that landed the industry in a deep ditch.
Led by sales growth for towable RVs and pricier stand-alone motor homes, recreational vehicle makers expect to ship more than 300,000 units to dealers’ lots this year for the first time since the economic downturn battered the industry in 2008 and 2009.
Those grim days are now in the rear view mirror. Employment across the industry has rebounded, and consumers who once picked small, no-frills travel trailers — dubbed “recession trailers” — are now trading up or buying larger, pricier RVs.
“We’re back to a more normal market where people are stepping up and buying nicer equipped travel trailers,” said RV dealer Debbie Brunoforte, who has logged her best post-recession sales year at her lots in Phoenix and Mesa, Ariz.
Shipments from RV manufacturers to dealers — a key measure of consumer demand — are expected to reach 316,300 units in 2013, up nearly 11 percent from last year’s total of 285,749, the Recreation Vehicle Industry Association said Tuesday on the first day of the industry’s trade show in Louisville. More gains are projected for next year.
“These are good times, you guys, really good times,” RVIA President Richard Coon said at the trade show’s kickoff event Tuesday. “Business is good.”
Through October, 2013 shipments were up nearly 13 percent from the same period last year, the group said.
Indiana is the manufacturing pacesetter, accounting for 83 percent of RV production in 2012. Oregon, California, Iowa and Michigan were next, each with a sliver of output.
Next year’s overall shipments are expected to rise another 6 percent, to 335,500 units, putting production in the neighborhood of 2007’s total of 353,400.
It’s a big turnaround from 2009, when shipments sank to 165,700 units amid weak demand and dried up credit that left dealers’ lots filled with the hulking vehicles. Some manufacturers closed their doors, and those that survived cut their workforces.
Now, easier credit is helping fuel the comeback as dealers obtain financing to fill lots and consumers get loans to drive away with RVs bound for campgrounds or tailgates.
“It’s back at a point where it’s not too easy, it’s not too tight, it’s about just right,” said Doug Gaeddert, a general manager with Indiana-based RV maker Forest River Inc.
Business conditions are so good the biggest worry seems to be a repeat of the partial government shutdown in October if Congress can’t reach a budget accord early next year.
“That impacted this business,” Coon said. “Traffic at dealerships slowed way down. Let’s hope they’re smart enough not to do that again.”
Pent up demand and favorable demographics also are aiding sales, as the industry’s core Baby Boomer base heads toward retirement. The industry says its focus on the 30-to-49 age group has paid dividends, with younger families entering the market for towable RVs attached to pickups or hitched to other vehicles.
Stand-alone motor homes, which took the biggest hit from the recession, are also showing signs of a comeback. Through October, motor home shipments for the year were up 36 percent from the same 10-month period last year, the RVIA said. Shipments for towables were up 10 percent compared to a year ago.
Motor homes are expected to reach 12 percent of all shipments in 2013 and 2014, up from 10 percent in 2012.
Towables cost between $8,000 and $95,000, with an average price of about $29,000, according to RVIA. Stand-alone motor homes range from $45,000 to $1.5 million for top-of-the-line, bus-like vehicles. The average price is about $131,000 for the amenity-filled moving homes.
At this week’s trade show, RV makers showed off new models to dealers looking to place orders for next year. The trend is toward smaller, lighter-weight RVs that can be towed by more vehicles. Those models also result in slightly better gas mileage, with some smaller motor homes approaching 20 miles per gallon.
The industry is much leaner now with 70 manufacturers — nearly a third less than before the recession.
“Those of us that survived certainly are reaping the rewards now,” said Derald Bontrager, president and CEO of RV maker Jayco Inc., based in Middlebury, Ind.
Jayco has seen broad sales gains in its product lineup, including for its motor homes, he said. With the upswing in shipments, Jayco has hired more workers. Its workforce is about 2,000, compared to 1,100 during the depths of the downturn but short of the 2,500 before the recession.
Industrywide employment — including manufacturers, suppliers, dealers and service departments — is estimated at 496,000, according to RVIA. Employment peaked at about 550,000 in 2007, then plunged to about 280,000 in 2009.
