Walworth: Industry Retail Inventories in Line
The atmosphere at the 48th Annual National RV Trade Show in Louisville, Ky., was clearly more upbeat than 2009’s convention and reflected an industry that is obviously mending from the most dire effects of the recent downturn.
But veteran industry statistician Tom Walworth noticed a fairly rampant theme at last week’s (Nov. 29-Dec. 2) Louisville Show that he’d like to address regarding U.S. RV shipments and dealer inventories because, Walworth maintains, there are some false assumptions out there that could skew forecasts and obscure the fact that the industry’s rebound is continuing in a serious way.
The bottom line, according to Walworth, is that dealer inventories – contrary to some perceptions – are in line as the industry heads into the final phase of 2010.
“The Recreation Vehicle Industry Association (RVIA) has forecast that we will ship 235,000 units in 2010, and SSI anticipates that 180,00 of them will be sold (at retail),” Walworth, general manager of Grand Rapids, Mich.-based Statistical Surveys Inc. (SSI), told RVBUSINESS.com. “If you do the math, that would put us at a 55,000-unit gain in inventory. But what isn’t generally known in the RV industry is that the RVIA number also contains shipments to Canada.”
Those Canadian shipments, says Walworth, comprise approximately 20% of all annual shipments by RV manufacturers.
“If you take 80% of the forecast shipment number — 235,000 — we’re talking about 188,000 units shipped to the U.S.,” he said. “Since SSI expects to track 180,000 units at retail next year state-side, we actually are looking at just an 8,000-unit gain in inventory — not the 50,000-unit gain the raw numbers might suggest.
“The floor planners may want to hear this,” he added. “This would reassure the industry that inventory is not exploding on dealers’ lots.”
Walworth acknowledged that the shipments would be dispersed among fewer dealers in 2010 due to retail closings attributed to the recession, but this should present no long-term problems. “Fewer dealers would mean that there are more units on the remaining lots,” he said. “But this is manageable.”