Just how bad is the RV industry hurting?

[Mike Goad]

An article on Bloomburg.com, says that RV shipments for 2008 may be at a 12-year low this year and may slip further in 2009. :'(

Part of the reason is ?Credit restrictions are causing RV buyers to delay purchases and RV dealers to keep inventories low.? 

Of course, the housing mess, the financial system mess, the unemployment mess, and the no-so-bad-now gas price mess have all had an impact.  If I can't afford my higher house payment, I'm certainly not going to be buying.  The same applies if I've lost my job and I'm not going to be inclined to buy if my savings has been significantly reduced because of the stock market crash. 

(disclaimer - my house is paid off; I'm retired and don't have a job to lose; and my investments are in more secure places than the stock market -- except for the few stocks I recently bought at bargain basement prices.)

On the other hand, I saw an piece on TV the other day where a family had decided not to go to Disney World next year -- they're going camping instead!   ;D

Our local RV dealership has moved his big-ticket RVs to the back of the lot and now features small travel trailers, fifth wheels, and tent trailers at the front and seems to be doing ok for now.

How are dealerships coping in other places?

see Bloomburg article.

 

[KodiakRV]

...Our local RV dealership has moved his big-ticket RVs to the back of the lot and now features small travel trailers, fifth wheels, and tent trailers at the front and seems to be doing ok for now.

How are dealerships coping in other places?
...

That's what a big RV dealer near us has done, too.

 

[smartech]

One of our local dealers put a bunch of their trailers out front next to the road. Then a big truck left the road and wiped out several of the trailers. That's one way to move inventory!

 

[ramcneal]

We just purchased a new 5th wheel a month ago and I've been back to the dealer for various reasons a couple of times. I can't believe how busy they are right now. I've gotten the impression that they just aren't used to this kind of volume. Other RV places seem to be hurting, but they are the shops with high overhead (fancy showrooms, completely paved lots, brand new golf carts). The dealer I bought from doesn't seem to spend a penny on overhead if it's not needed.

 

[Ernie Ekberg]

One of the largest rv dealers here in town, right on the interstate- talk about exposure, has pulled out and there is just an empty lot.
I know my business, flooring, is dormant. I hope it revives as my wife will have to get another job ~ ;D

 

[davemittan]

Our dealer (in NW Arkansas) is now promoting towables.   The 2007 Four Winds 28A we traded in April 2008 is still sitting there, unsold - they have a lot of other motorhomes in inventory.  This is in an area that has over 300,000 people in two counties.

 

[Mike Goad]

Our dealer (in NW Arkansas) is now promoting towables.   The 2007 Four Winds 28A we traded in April 2008 is still sitting there, unsold - they have a lot of other motorhomes in inventory.  This is in an area that has over 300,000 people in two counties.

Would that dealer be at Lowell, Arkansas?  The 2006 Heartland Bighorn 5th wheel we traded in last July doesn't appear on their online inventory.

 

[davemittan]

Yep - the dealer is in Lowell.  I think they're way over-capitalized.  Way too much inventory.  They're in a real bad spot.

 

[sheltie]

The RV Industry" is doing very poorly especially when you consider how many manufacturers have quit doing business.  My guess is that far less young and middle age buyers are out there right now as they are more worried about jobs, health and education expenses than we geezers may be.

 

[davemittan]

Last year we thought we saw a big increase in pop-ups and tents.  So the younger crowd might be making that kind of adjustment.

We saw one pop-up with a slide, and an "Add-A-Room".  It was housing TEN people at the time.  (see attached pics)

 

[Mike and Sherrie in VA]

According to RVIA, as of the end of 2008 the total # of wholesale shipments declined by roughly 75-80% from 11 months earlier.

RVIA Wholesale Shipments 2008

 

[Tom]

That shipments summary table sure puts it in perspective, and paints a bleak picture. Thanks for the link.

 

[Gary RV_Wizard]

Sales are quite a bit better than the wholesale shipments indicate, which means the dealers are depleting inventory. Motorhome sales are down about 52% and towable sales better than that, so there are some buyers out there (I personally know several people who have bought in the last 3-4 months). But the manufacturers will still die of the dealers don't refill their inventory and what sane dealer would do that these days? I've heard they aren't even accepting special orders cause they don't want to (or perhaps are unable to) floor plan the rig until the sale closes.  Or they can't afford the risk that the sale may not actually ever close.

 

[Tom]

I heard &/or read somewhere recently that at least one manufacturer was feeling additional pain from the buy-back agreements. i.e. if RVs in dealer inventory don't sell within some period of time, the manufacturer is bound by the agreement to buy them back. Because dealers haven't been selling, the manufacturer is having to come up with the cash for the buyback.

 

[Gary RV_Wizard]

That provision is in some of the floor plan agreements, where the manufacturer is (was) helping the dealers get better rates by agreeing to a buyback program. Was a great idea until the whole market went south and suddenly there were many buyback requests rather than just. Monaco is one who did that and I heard they got the lendor involved to agree not to demand buybacks, at least not unless the dealer actually folded.  The idea was to stop dealers from simply saying "I don't want it - take it back" but remaining in business selling other stuff.  Don't know how accurate what I heard is, though. I'm sure the lendors aren't going to take a loss if they can get Monaco to make it up.

 

[Tom]

Gary, I suspect you and I read the same article.

 

[turkey trail]

[Bank of America just clamp down on credit to the RV dealers. Making it impossible for all but the very strong dealers to buy inventory. They are requiring that the dealer pay for 15% of the unit right up front. And then asking for a 3% payment every month after.

 

[PancakeBill]

My old boss at LD bought a dealership in AL, and recently lost his floorplan agreement.  He now only has used and consignment.  Really bad for him, bad for me, cuz I was considering going there to work after AZ. 

I may have to come out of computer jobs retirement. 

 

[Pierat]

Sorry to hear that, Bill. Hope it works out for you and for him. Is the computer industry feeling the downturn as much as most retail?

 

[PancakeBill]

Not sure. but my skills lie in the usage of, not the sales of area.  I spent 20 years in medical supply computer management.  I just never wanted to go back to it.