Baird Forsees 10%-15% 2010 Towable Growth
Editor’s Note: Robert W. Baird & Co. issued a client newsletter after this week’s release of the August towable sales figures by Statistical Surveys Inc. (SSI). Excerpts from the Baird Newsletter follow.
U.S. towable registrations increased 11% in August. Dealer sales of towable units increased for the sixth consecutive month in August. Total U.S. towable retail increased 11% (travel trailers up 11%; fifth-wheels up 11%) compared to an 8% drop in motorhomes. Looking to the remainder of 2010, we expect approximately 10-15% retail growth in towables, with Thor taking share.
Towable retail up 11%. Towable demand improved in August. Travel trailer registrations grew 11% while fifth-wheel demand also increased 11%. Towable sales outpaced motorhome sales which fell 8% in August.
Leaders gaining share. Thor continues to take share with retail registrations up 16% in the month. We also note that Heartland RV (No.4 market share and recently acquired by Thor [THO-$31.52-Outperform]) saw registrations increase 41%. Altogether the top five manufacturers have seen retail grow 20% YTD versus 8% YTD industry growth.
Inventory. Dealers have increased towable inventory in 2010 as towable shipments have exceeded retail sales. We believe that dealer inventory is fairly balanced at current levels and future shipments should track in line with retail demand.
Retail SAAR. We calculate a seasonally adjusted rate of retail (SAAR) registrations. The SAAR of towable demand increased to 159.K units in August from 153.6K units in July.
Recent news. Winnebago (WGO-$9.74-Outperform) indicated today (Oct. 18) that it is looking to acquire SunnyBrook RV, the No. 13 player in towables with 1% share.
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