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baird_new_logoEditor’s Note: Robert W. Baird & Co. tracks the course of the RV industry and releases periodic notes to its investor clients. Following are excepts from its latest note following Monday’s release by Statistical Surveys Inc. of the October motorized RV sales.

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Motorhome retail fell 28% in October. Class A registrations decreased 31% while Class C registrations fell 23%. Motorhome demand remains weak (note that October begins the seasonally less significant winter selling season), but shipments are beginning to come into line with retail as the dealer destocking trend has run its course. Conditions remain difficult, but we expect a robust wholesale recovery as demand improves and dealers replenish inventory at a more normal rate.

Summary

Motorhome registrations fell 28%. Class A registrations fell 31% to 808 units, while Class C registrations dropped 23% to 511 units.

Gas/Diesel. Class A-Diesel registrations fell 30%. Class A-Gas registrations fell 33%.

Retail SAAR. The seasonally adjusted annual rate of motorhome retail registrations for October was 18,100 units, up from 16.900 units in September.

Dealer inventories. Retail was roughly in line with wholesale in October, indicating dealers are beginning to stock at closer to a 1:1 rate. We believe the destocking trend has run its course and expect more normal replenishment rates going forward, driving improved wholesale shipment results.

Notes. The data excludes results from Minnesota and Georgia due to reporting delays. We caution against attaching undue significance to data from a single month. The data tend to fluctuate from month to month, and are frequently revised.