Editor’s Note: The following article appears in the current issue of Roadsigns, a quarterly forecast of delivery of RVs written by Richard Curtin of the University of Michigan for the Recreation Vehicle Industry Association.
Total RV shipments rose to 48,600 in the third quarter of 2009. This represented a strong 14% gain from the second quarter, returning shipments to just below the 49,400 recorded in the third quarter of 2008. While total shipments have begun to recover from the 25-year lows, most of the renewed strength was in conventional and fifth-wheel travel trailers.
RV shipments are expected to total 159,500 in 2009, which would be the lowest annual total since 1982. Shipments of RVs are expected to total 203,500 in 2010, with seasonally adjusted gains throughout the year ahead. The expected strength will be focused on conventional travel trailers, which will regain their entire 2009 loss. Motorhome shipments will also improve, although at a slower rate.
The slower than normal pace of the recovery in RV sales reflects offsetting shifts as well as the extent of the financial setbacks suffered by consumers. Easing credit conditions will enable more purchases, but credit will not return to the easy standards of the last decade. Continued high unemployment will still have a negative affect on the market in 2010. Declines in household wealth as well as consumers’ intentions to rebuild their savings and pension accounts will also slow the rise in demand for RVs during the year ahead.
The Upside of the Downturn
The financial crisis has had a profound impact on nearly every aspect of the RV industry. Manufacturers, suppliers, dealers and customers have faced the economic storm of their lifetime. A few of the players abandoned their craft in rough seas, a few are barely alive, but most have withstood the worst economic conditions they had ever known.
One clear result was that nothing can diminish the strong consumer attachment to the RV lifestyle. Almost every other aspect of the industry will undergo change, from the type of RV that consumers will demand, the range of options and features, service and maintenance, and destination and camping facilities. There are substantial long-term rewards that can be reaped by forward-looking companies, or even new entrants, by abandoning outdated paradigms and focus on meeting the needs of the 21st century RV consumer. The extent of the financial crisis has accelerated what would have been a slowly evolving process of change.
More importantly, the crisis has accelerated the upside potential for profits and market shares for innovative companies.