Salesmen at Toscano RV Center, Los Banos, Calif., are seeing more lookers these days.
As reported by the Merced Sun-Star, Sales Manager David Morse said that while sales may be down from last year, he is optimistic the business will survive the current challenging economic environment.
But on Tuesday (Dec. 9) morning they were the only two people walking through the large lot.
“This year it started slowing down,” said salesman Gilbert Batista as he readied the new 2009 models for viewing. In 2007 he sold 70 RVs. “I might hit 50 if I’m lucky,” he said of this year’s sales.
While their numbers are down 40% for the past two years, Toscano has managed to stay afloat while much of the industry is seeing a big slowdown because of the national recession. Not only have several large RV dealers in California shut their doors, but also several manufacturers nationwide have been forced to close.
“Last time I counted there was 13 to 14 manufacturers that went out of business,” said Darrel Friesen, president of California’s Recreation Vehicle Dealers Association.
Flores noted that there used to be eight Airstream dealers in the state. This year three shut their doors.
According to the Sun-Star, these closings are just one part of an industry slowdown rooted in the tightening credit and faltering housing markets.
Friesen said banks just aren’t giving people credit like they used to. A year ago he could automatically approve credit for someone with a credit score of 680. Now they are denying people with scores of 750.
Flores said that aside from tighter credit, there just aren’t as many banks around giving loans to RV buyers. They used to have six big banks they could go to for financing. Now they only have three, said Flores: U.S. Bank, Bank of the West and Bank of America.
Friesen said sales have also been affected by the housing downturn because many people used to buy RVs with home equity loans.
California – the largest chunk of the national RV pie with 10% of the market – has seen precipitous declines. Paul Roberts, who produces the California Market Report for the California RVDA, said that there is no doubt that RV sales are down. Roberts said in the past two years the state’s sales have dipped by 40%.
Nationally, said Friesen, the picture is much the same and for the same reasons.
Toscano, which opened its doors in 1967 and is one of the more prominent Airstream dealers, saw a steady increase in sales until recently. Their sales jumped from roughly 200 a year in the late 90s to more than 500 a year as recently as 2007. This year’s sales stand at 395.
At their peak, said Flores, they had a full-time sales staff of eight on the lot. Now they have five.
Sales may be easing off, but Flores feels comfortable about where Toscano stands. They have a diversified inventory with 16 different brands and their best-selling product, Airstream, is still at the top of the list of many of their customers when they want a travel trailer.