Dr. Richard Curtin, Ph.D., of the University of Michigan, believes RV shipments will reach a new 25-year high this year despite high gas prices and expectations of higher interest rates.
Curtin, director of the Survey of Consumers at the university, is forecasting that 347,800 motorhomes and towable RVs will be shipped from manufacturers to dealers in 2004, which would represent an 8.4% increase over last year’s total of 320,800.
Curtin’s latest forecast, presented recently to the Recreation Vehicle Industry Association (RVIA), suggests a slight cooling off of the RV market during the second half of this year, after it grew at a torrid pace, at least during the first four months of this year. Year to date through April 30, total RV shipments were up 19.6% to 128,600 units, compared with 107,500 in the first four months of 2003.
The wholesale and retail markets for RVs were relatively weak during the first five months of 2003 because of consumer worries about the war in Iraq.
The years 2003 and 1999 were the two best for the RV industry in the last 25 years, so an 8.4% increase in 2004 versus 2003 would still be a significant accomplishment.
“The positive outlook for RV shipments is due to renewed growth in employment and low interest rates,” wrote Curtin, economic consultant ot the RVIA. “While interest rates are expected to rise, they will remain at comparatively low levels through the end of 2004.
“Higher gas prices will lower disposable incomes,” Curtin continued. “But most consumers expect the spike in gas prices will be reversed. Without supply disruptions, consumers are unlikely to forego their plans to purchase an RV.”
For 2005, Curtin is forecasting the RV wholesale market will pull back slightly to around 320,000 units shipped, an amount approximating the delivery totals for 1999 and 2003.
“Increases in interest rates will have a greater impact on RV shipments in 2005,” he said, “but even then the size of the impact will be relatively small due to the offsetting impact of strong job gains as well as increases in wages.”
Here are more details of Curtin’s forecast:
• Travel-trailer shipments will increase to 152,000 units this year, compared with 139,800 units in 2003, before declining to 144,700 units in 2005.
• Fifth-wheel shipments will increase to 84,900 units this year, from 74,600 last year, before decreasing to 78,900 in 2005.
• Folding-camper deliveries will decline to 32,000 units this year, versus 35,700 last year, and will slip even lower in 2005 to 25,800.
• Truck-camper shipments will increase to 9,200 units this year, compared with 8,800 in 2003, but will decline to 8,000 units in 2005.
• Class A motorhome shipments will increase to 45,500 units this year, from 41,500 last year, before declining to 41,300 in 2005.
• Class B motorhome deliveries will inch up to 2,200 units this year, versus 2,100 in 2003, before declining to 1,900 in 2005.
• Class C motorhome shipments will increase to 22,000 units this year, from 18,300 last year, before slipping down to 19,700 in 2005.