RV dealers and their volunteer leaders agree: the number one issue facing the RV industry is financing.
The Obama administration must turn its attention on the severe impact of the credit crisis on RV dealers and the urgent need for floorplan credit, according to Mike Molino, president of the Recreation Vehicle Dealers Association (RVDA).
Without retail credit and floorplan loans, Molino noted in an appeal sent out today (April 2) to RVDA membership, even well-capitalized dealers can be out of business. “Preserving floorplan lending is essential to keeping dealers in business and purchasing new RVs,” he said. “The RV industry will not recover until the retail credit and floorplan problem is fixed.”
RVDA is urging the president and Congress to support the following policy recommendations. These recommendations also have the support of the National Automobile Dealers Association (NADA).
- Expand access to Small Business Administration (SBA) lending capacity for dealers. The Administration has the statutory authority to expand the SBA size standard that today excludes many dealers. Also, the Administration has the statutory authority to allow SBA’s guarantee program to be used for floorplan loans that currently are ineligible under the program. An emergency directive implementing these two changes would increase access to credit for small business dealers all across the country.
- Restore liquidity for RV retail and floorplan lenders. Work with the Federal Reserve Board to make sure that the Term Asset-backed Securities Loan Facility (TALF) injects essential liquidity by revitalizing securitization of RV retail and floorplan loans. If TALF is too cumbersome to meet this objective in the short term, then create another mechanism to restore lending in these areas.
“Time is of the essence,” Molino stated. “President Obama’s pick for the SBA’s new administrator, Karen Mills, told Senators at her confirmation hearing this week that she ‘would be very interested’ to look at the SBA floorplan loan policy ‘quickly and see what the possibilities are to help.’ It’s time to urge the administration and Congress to transfer those words into action. Please contact your U.S. senators and urge them to support changes in SBA loan policies that can help RV dealers.”
RVDA will post regular updates and more information at www.rvda.org.