It still appears this year will be the RV industry’s best since 1978, but Dr. Richard Curtin of the University of Michigan and an economic consultant to the Recreation Vehicle Industry Association (RVIA), now is forecasting a decline in shipments of almost 9% in 2005.
After experiencing a 20% increase in wholesale shipments for all types of RVs during the first half of this year to 196,200 units, Curtin is forecasting that 2004 will end with a total of 361,200 units being shipped, a 12.6% increase over the 320,800 units delivered to dealers in 2003.
Although lower than the expected 2004 total, Curtin’s forecast 2005 shipments total still would be the second best for the industry in 25 years.
“The anticipated mild growth pause in 2005 represents a balancing of demand in the otherwise robust upward trend in RV shipments over the decade ahead,” he stated.
RVIA Vice President of Administration Mac Bryan said Curtin admits his 2005 forecast is “overly conservative” because the mathematical formula he uses pulls the forecast numbers down toward a long-term average.
Because shipments totals since 1998 are much higher than the annual totals during the 1980s and most of the 1990s, Curtin’s equation pulled the forecasted 2005 total down toward an average that does not fully reflect the industry’s recent growth, according to Bryan.
But Bryan defended Curtin: “Given the current state of the industry, that (being overly conservative) is probably the better position to take. Two years ago, if we said 330,000 units would be shipped in 2005, people would be doing back flips.”
In June, Curtin forecasted RV total shipments this year would increase a more modest 8.4% to 347,800 units, before declining 7.9% in 2005 to 320,300 units.
His latest forecast also included the following:
• Class A motorhome shipments will increase 11.1% this year to 46,100 units, compared with 41,500 in 2003.
• Travel-trailer shipments will climb 12% higher to 156,600 units this year, compared with 139,800 in 2003.
• Fifth-wheel deliveries will increase 19.8% this year to 89,400 units, compared with 74,600 in 2003.
If the projection that 361,200 units will be shipped this year holds true, it would make 2004 the best year since 1978, when 389,900 units were delivered to dealers, and it would surpass the near-term cyclical peak of 321,200 units shipped in 1999.
For 2005, Curtin is forecasting a decline of 8.6% to 332,700 units “due to rising interest rates, slower growth in real after-tax disposable incomes and sluggish growth in employment,” he reported in the fall 2004 issue of RV roadsigns.
Curtin’s forecast for the major product categories for next year includes the following:
• Class A shipments will slip back to 41,500 units.
• Travel-trailer shipments will erode slightly to 148,800 units.
• Fifth-wheels will edge lower to 82,600 units.