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Citing the impact of rising interest rates, economist Richard Curtin of the University of Michigan still anticipates “a mild pause” in total recreational vehicle shipments for 2005.
Curtin, however, marginally upgraded his previous forecast in which he called for a 3.3% drop from the 370,100 units shipped last year – a quarter-century benchmark – to reflect a “small anticipated decline of 2.5%” to 360,800 units for ’05.
Originally, in the third quarter of 2004, Curtin had projected a more negative 8.6% dip in 2005 deliveries.
Curtin stated in the spring issue of Roadsigns, published quarterly by the Recreation Vehicle Industry Association (RVIA), that the “temporary slowdown in the pace of growth is due to anticipated continued increases in interest rates during 2005.”
The latest quarter-point rate hike, initiated Feb. 2 by the Federal Open Market Committee, pushed the prime interest rate to 5.5%.
Long term, Curtin contends the industry will continue to experience growth during the next decade.
Curtin feels the dip in 2005 will primarily affect the motorhome market, along with the folding camper trailer sector, which has been weakening for the past several years.
Curtin said the dip will be offset by continued strong performance by conventional travel trailers and fifth-wheels, which “are expected to remain at the same record levels recorded in 2004.”
That market, including the growing hybrid sector, has doubled over the past decade, accounting for 69% of all shipments compared to 49% ten years ago, according to Curtin.