Forbes: Rambling With Airstream CEO Wheeler
Editor’s Note: The following is a Q&A conducted by Forbes with Bob Wheeler, president and CEO of Jackson Center, Ohio-based Airstream Inc.
Some products transcend their milieu to become icons. In the world of recreational vehicles, Airstream is the icon. The aluminum-skinned “silver bullet” trailer has retained the same streamlined aesthetic since its creation in 1931. A division of Thor Industries since 1980, Airstream produces a lineup of six travel trailers and two touring coaches. Airstream’s products are considered by many to be the finest production RVs in the world.
Bob Wheeler has been president and CEO of Airstream Inc. since August, 2005, having previously served as the company’s vice president of product development and engineering. Before working in the Airstream division, Wheeler worked for Dutchmen Manufacturing Inc. and Fleetwood Enterprises Inc. Wheeler began his professional career at General Motors after receiving his MBA from the State University at New York in Buffalo and a BS in Mechanical Engineering from the University of Rochester.Wheeler spoke about the current state of the recreational vehicle market, projections for the future, and Airstream’s plans for the future in a brief telephone interview.
FORBES: Airstream sales for 2011 were up 175%, with trailer sales doubling and coach sales increasing as well.
BOB WHEELER: Coming out of our big industry trade show in Louisville, those numbers are in comparison to last year’s result.
FORBES: What’s the trend been over the last five years? I’m assuming that the 2008 financial crisis hit you hard.
BW: Yeah, since RVs are a big-ticket discretionary purchase industry. It got hammered and we were no exception. ‘08 and ‘09 were pretty bad years. Significant recovery in 2010. 2011 was a strong year as well. Things have leveled out industry-wise. But everything continues to grow at a pretty good clip.
FORBES: And you’re anticipating 2012 to continue the trend, level or are you looking towards a growth trend?
BW: Well the predictions for the industry are down about 4% but our plans show us growing 15% – 20% in the calendar year.
FORBES: Can you give me an idea what the raw numbers are? How many trailers and vans?
BW: Sure, we’re building about 27 trailers a week right now. So that’s 1,550 trailers at our current clip. And we’re building 5 vans a week. We plan in the spring based on an uptick in spring demand that we see typically to increase production to at least 30 maybe more trailers and vans probably to six or seven a week.
FORBES: And you have a dealer network, how many dealers across the country?
BW: We have about 65 dealers, they’re not distributed evenly. We have a lot of dealers in key markets like Southern California and California in general. About 65 dealers coast-to-coast and Canada. We’ve got about 5 in Canada. Most of them are multi brand outlets. We’ve got a handful that are exclusive. Most of them carry other lower price products, helping bring cash flow.
FORBES: Are you building to order or do you maintain stock and inventory?
BW: We build to order no, those orders pertain to the dealer orders. But we’ve been able to go several years now without having to build any open units that we call them, unsold units. We’ve tried to maintain that position as you might imagine.
FORBES: What’s the build time from order to delivery?
BW: Right now, trailers are running about 12 weeks and vans are about 8 weeks. Between the dealer placing an order today and the delivery of a trailer or van.
FORBES: Are your dealers maintaining stock or are they pretty much taking orders and promising delivery around your schedule?
BW: All of our top dealers contain a strong inventory. When someone comes in to buy an Airstream, as you might imagine, they want to be able to see all the options, all the floor plans, all the colors. That helps them make a decision on which one they want to buy. So our top guys maintain a pretty healthy inventory and they reorder usually on a monthly basis, so that 12 weeks out or 10 weeks out they can get the trailers they need to keep inventory of the stock.
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