Riding the momentum of a landmark 2016 that saw shipments motor to a 40-year high, the industry is primed for more of the same this year as reports from the early show circuit have been decidedly positive underscored by record attendance and sales at the Florida RV Supershow.
That optimism was echoed by several dealers in Tampa, buoyed by a host of beneficial economic indicators including easier access to financing, stable gas prices, and generally upbeat consumer sentiment.
“It feels like we finally put the Great Recession behind us. The only warning sign is that we aren’t seeing any warning signs. I’m a banker by nature, so I’m a risk manager. But I have to say it seems very positive,” said Cody Loughlin of America Choice RV.
Loughlin, the son-in-law of America Choice founder Mandy Alonso and, along with partner Scott Gencarelli, co-owner of the dealership, said the retailer saw a 10% year-over-year increase in 2016 representing its best year on record.
“For us, the travel trailer market has been on fire and the luxury fifth-wheel market also has been very strong. We’ve been a top DRV Mobile Suites dealer for six years, and we’re seeing more demand now than ever before,” Loughlin said, noting in the past year the dealership opened a fourth location in The Villages, joining outlets in Bushnell, Zephyr Hills and the flagship store in Ocala, which has a 106-site adjoining campground for customers.
He added that during the the latter part of 2016 and into the first few weeks of 2017, America Choice RV’s sales are up around 20% from a year ago, boosted by a strong showing at the Tampa SuperShow which resulted in more than 100 units sold including residual sales.
“In the first part of last year there was a lot of uncertainty about the economy,” Loughlin said. “We’re not seeing that nearly as much now. I think there has been some certainty put in place with the presidential election out of the way. And it seems like the economy is going in the right direction right now. We’re not politically affiliated by any means, but it feels like the mood about the economy right now is really good. That’s big for our industry. Our industry sells recreational vehicles, not necessity vehicles. They make those; they’re called cars. Our industry is affected by the mood of the country.”
Likewise, Matt Gerzeny, vice president of Gerzeny’s RV World, said all indications are that it’s going to be “another great RV year,” noting that the dealership would be adding to its Florida locations in Nokomis and Lakeland with stores in Bradenton at the end of January and in Fort Myers by March 1.
“2016 was our best year. We experienced 20% growth last year, and we’ve seen that for at least the last three years in a row,” Gerzeny told RVBUSINESS.com. “It was a really good year and every segment did well for us. We haven’t really seen an influx in any particular product category “” we’ve seen an influx in everything. We’re seeing younger buyers, and we’re seeing better-credit buyers. What we’re seeing less of, which is a little strange, are trade-ins. What that identifies to us is we’re getting more people who are new to the industry. Or, they’ve sold them on their own, which we hate to hear.”
Like others, Gerzeny is predicting another step up for the industry this year.
“The biggest sign for me is who’s in office,” he said. “I probably shouldn’t say that, but I’m excited about Trump getting into office. I see a lot of excitement there. I see a lot of business leniency with regard to regulations, which personally I think is way overdue. I want to focus on business and not on all the rules and regulations, and I think that’s going to help a lot of businesses. It’s going to allow us to hire more people and it’s going to allow us to have more full-time people. I see a lot of exciting things happening in 2017. I see a lot of people traveling more in our own country in 2017.”
Other comments from Tampa included:
“¢ Ron Fleming, vice president and general manager of Tampa-based mega dealer Lazydays RV, which also has storefronts in Tucson, Ariz., as well as Denver, Colo., said his dealership has its sights set on a good year.
“2016 was a really good year; we saw growth that outpaced the industry. We always try to do a little better than the market. We saw some good growth particularly in the towables and Class C segments,” he said. “We’re not getting any sense or any feel that it’s going to be anything less than a great year. The manufacturers are building nicer towable vehicles and lighter towable vehicles. The auto industry is way up in terms of trucks and SUVs, so the tow vehicles are out there. Maybe four or five years ago you had to have a three-quarter ton truck to tow something, but consumers are buying SUVs to take the kids to soccer games and finding out they can also tow a trailer with it. I mean, you can get a 30-foot trailer these days that weighs less than 5,000 pounds.
“And the manufacturers have also done a really good job of equipping these things while keeping prices really low and competitive and affordable,” he continued. ” I mean LED lighting, fireplaces, surround sound, electric everything, push button “” all the stuff the younger folks really enjoy. I think it’s a combination of an expanding market and the industry’s willingness and their aggressive nature to realize that the potential is there, and they are fulfilling that need.”
“¢ Loren Baidas, president of General RV, reported that 2016 was a record year for the dealership which operates 11 stores located in Michigan, Florida, Illinois, Ohio and Utah. In fact, he added, all stores posted positive results.
“We saw most of our growth in entry-level buyers purchasing lightweight towables, which means new people coming into the industry. We also saw a lot of people getting into entry-level motorhomes, such as smaller Class C’s and Class A’s,” Baidas said, adding that for 2017 he expects the industry to continue to grow, albeit at a more moderate pace. “I don’t see huge numbers of growth but I definitely think there are some segments that are going to grow “” and it will especially continue in the entry-level buyer segments. Dealers who are managing their inventory properly are going to bear the fruit of that.”
Baidas also addressed dealer growth, as a number of prominent companies recently added several locations by way of acquisition, among them Camping World, Camper’s Inn and Lazydays RV. While General RV still bills itself as the “Nation’s Largest Family Owned Dealer,” of its 11 storefronts the last one was added in 2014, although the dealership did complete a major project with the construction of an all-new headquarters in 2015.
“The biggest thing for us is bigger isn’t better. For us, better is better. So we focus on and maximize all of the opportunities we currently have. We provide good customer service. We run very good dealerships. But we also recognize there are some avenues where we need to do better. So we’re focusing on the customer. We’re focusing on the employee. And we’re focusing on the experience,” Baidas said. “We could go out and add a number of stores if we really wanted to, but I don’t think that would allow us to provide better service to our customers.
“When the day comes that we feel like we could provide better service by adding another dealership,” he continued, “we’ll take advantage of that opportunity. For us it’s long-term, and strategic. We’re not planning for the next two years; we’re planning for the next 20 to 30 years.”
“¢ Don Strollo, president and CEO of RV One Superstores, reported that his dealership was up 17% in 2016 having sold almost 8,000 RVs. For 2017, in addition to expecting another bump in business, Strollo said the company is building three new facilities, including an Airstream standalone dealership in Tampa that will break ground in 30 days, as well as brand new facilities for its Tampa and Des Moines, Iowa, stores.
Speaking from a very busy Airstream display at the SuperShow, Strollo related the trends he’s seeing are a greater number of younger buyers, older prospects who are still adamant about RVing as well as a high-end market that continues to do well.
“In the last couple years, a lot of people said the high end is going to slow down,” Strollo said. “We are not seeing the high-end business slow down for us at all. That’s probably the biggest surprise of 2016. The high-end business is still there for us. Airstreams and diesels are still selling very well. We feel that shows there is still a lot of strength in the overall RV industry, but also in the high-end business which a lot of people have been nervous about.”
“¢ Denver Beck, owner of Optimum RV in Ocala, Fla., offered similar sentiments, saying his growing dealership enjoyed a 40% increase in business last year and is eyeing a 50% jump in 2017.
“The most exciting thing about that is you can see the consumer is optimistic about the economy. They’re willing to pay more for the product, and they’re willing to finance more. That’s a reflection of consumer confidence,” Beck said. “We’re approaching a point where our shipments are getting higher and higher, but the next step is you’re going to have your customers moving up in coaches. We’ve seen an increase in that just in the last three to four months. That side of our business has probably tripled. The majority of what we have been selling is higher dollar stuff.”
As much as a hot market lifts his business, Beck added that internal initiatives are also helping Optimum RV to ever-higher levels of success.
“We are actively pushing to grow our dealership and offer better prices, better service,” he said. “As an owner-operated store, my managers and myself are able to shake hands with our customers. My customers have a direct line to the owner of the company. We try to go above and beyond with respect to customer service. That’s really why we focused on increasing the size of our site rather than expand to multiple locations. No matter how many deals we do in a month out of that store, we’re in a position now where we can still control customer service.”