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Iowa’s RV Dealers See Revived Consumer Interest

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September 21, 2009 by   1 Comment

AutoramaRV logoEd Garner sees more enthusiasm in the people who prowl his lots these days. He likes it.

“It seems like we’re getting more traffic,” said Garner, owner of Autorama RV Center in Des Moines, Iowa, where business this year is up an estimated 40% from the worst-in-a-decade decline of 2008. “A lot of people seem to be coming farther away than what they used to. We’re getting people coming from 100, 125 miles away.”

Part of that, Garner conceded, may be that his pool of customers is larger now that several former competitors have closed. But readiness to buy, he said, also provides hope that America’s bottom-dwelling recreational vehicle industry now finally seems pointed upward, according to The Des Moines Register.

“I think there’s still room for improvement,” said Garner, who over the weekend sponsored an RV and boat show in the Varied Industries Building at the Iowa State Fairgrounds. “I don’t think a lot of the retirement people that we used to get are probably the strongest buyers right now. But the farm people who are still farming, they seem to have a little more money than they’ve had.”

Ron Lichtsinn, owner of Lichtsinn Motors Inc. in Forest City, agreed that a troubled business seem to be trending up. The world is not yet as rosy for Lichtsinn, who sells motorhomes with six-digit prices in comparison to Garner, who sells mostly travel trailers.

“If you were going to compare it back to the record years of ’04 and ’05, yeah, it’s still lousy,” Lichtsinn said this week. “But we’re certainly starting to see a lot of energy.”

That’s important, analysts said, because RVs generally are a good indication of whether consumers are ready to spend money on big discretionary purchases.

“The RV industry is always the first in and the first out, and there’s already been a noticeable beginning of it coming out of the current recession,” Dave Hoefer, an adviser to Earthbound Recreational Vehicles in Indiana, told Bloomberg News earlier this month.

 Data from the national Recreation Vehicle Industry Association (RVIA) show wholesale sales of RVs in the United States peaked at 390,500 in 2006, slipped to 353,400 the next year, then dove to 237,000 in 2008.

Shipments from factories to dealers are projected to total less than 150,000 in 2009, according to an association report released last week. But July’s monthly decline was the smallest it’s been since October, and analysts now project the tide to turn in 2010, with factory shipments of roughly 185,800.

Industry news reports describe a creeping optimism that in recent months has included slightly stepped-up production at RV makers around the nation and several new manufacturers arising from the assets of bankrupt firms.

Winnebago Industries Inc. of Forest City said this week that it has gradually begun to rehire portions of a work force that layoffs have halved in the past 18 months to 1,650 people at the end of May.

“There have been a few that have been called back, but nothing of significance,” Winnebago spokeswoman Sheila Davis said. “I think we are being cautious.”

Winnebago, which lost nearly 60% of its stock value between September 2006 and February 2009, has seen its stock triple in price since then, from $4.05 per share to $12.62 at Friday’s close.

Iowa dealers said most current buyers seem more interested in low- to moderate-priced travel trailers but that buyers also are interested in the tiers above entry-level products.

Denise Roberts, owner of Imperial RV Center in Ankeny, said consumer confidence seems to be building slowly. Her business has been picking up since April.

“I think in the early part of the year, it was more that nobody knew what was going on,” Roberts said. “I think it was fear. For a while there, it got a little scary.”

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Comments

One Response to “Iowa’s RV Dealers See Revived Consumer Interest”

  1. john Dipietro on September 24th, 2009 10:03 am

    Nice to hear from upbeat people for a change.

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