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GE Louisville Show Survey: 2013 Looks Good
Posted By RVBusiness On December 10, 2012 @ 1:31 pm In Breaking News,News In Focus | No Comments
Four years after the height of the economic downturn, North American RV industry participants believe they’re heading in the right direction, according to results of a survey conducted by GE Capital’s Commercial Distribution Finance (CDF) business unit of 150 attendees at the Recreation Vehicle Industry Association’s (RVIA) 50th National RV Trade Show.
“I think the biggest thing I take away from this survey is that, as dealers are looking out at 2013, they feel relatively optimistic about their opportunities,” reports Tim Hyland, commercial leader of CDF’s RV group, upon on the release this morning (Dec. 10) of the results of a survey circulated Nov. 26-28 during the Louisville Show.
• 43% of survey respondents expect sales to increase 5% to 10% in 2013.
• 27% were most optimistic about consumer demand going into next year.
• 29%, a similar percentage, listed that same issue — consumer demand – as their biggest business concern followed by qualms over financing solutions and product affordability and availability.
“These survey results are consistent with what we are seeing in the market and hearing from our customers,” said Hyland, a 19-year GE sales veteran. “Consumer demand drives the industry, so it’s naturally an area of optimism as well as concern. However, economic indicators, such as an uptick in housing starts, give us reason to believe that 2013 will be a good year for RV sales.”
Hyland wasn’t surprised by the extent of survey respondents’ optimism with regard to 2013 and the fact that they actually marginally exceeded those of RVIA’s own prognosticator, economist Richard Curtin of the University of Michigan’s Consumer Survey Research Center.
“You know, we looked at this earlier in the year and, again, we were looking at 3% to 4% growth,” Hyland told RVBUSINESS.com. “I read recently that RVIA is predicting shipments up about 4 1/2% for next year, and so a 5% to 10% growth range on behalf of the dealers is reasonable for what we’re seeing. You know, as far as what we see ourselves, inventory levels are solid and turning. So, it’s a positive indicator.”
Nor does Hyland see any inconsistencies in respondents’ level of concern over credit availability. “The fact that a significant number of the survey subjects at Louisville expressed some concern about consumer demand and credit availability is probably not a complete surprise,” Hyland noted, adding that he feels that floorplan lending – GE’s chief service to North America RV dealers — continues to ease.
“Yeah, I think that when we look out at the market,” he added, “we see that on the wholesale side there is significant availability in the marketplace and we therefore don’t view that as a concern for the dealer base in the market right now.”
Fifty percent of the Louisville Show survey’s subjects, in turn, told GE that the trend that will most likely have the largest impact on the RV industry in the year ahead is the popularity of “base” or low-cost models. In a response that mirrors recent RVIA shipment reports, an overwhelming 70% of survey respondents said travel trailers would be in highest demand, with fifth-wheel trailers a distant second at 15%.
“During the downturn, the market shifted more towards the towable side of the business because it’s a more affordable way for people to enjoy the RV lifestyle,” said Hyland. “And today, consumers are still looking at value. But the market appears to be supporting higher dollar values as well, which bodes well for all price points across the industry. Towables are doing really well, but motorized is coming back, and we expect to see improvement across all price points and classes.”
Bottom line, said Hyland, the survey provides further evidence of the fact that the industry continues to heal from the Great Recession. “Yes, there tends to be a strong correlation between housing and consumer confidence, being that housing tends to be the largest asset that people own. So, as you see housing improve, you would expect to see consumer confidence improving. And I think we, based on that, expect to see continuing improvement in 2013.”
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