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Faced with declining sales and signs of an eroding marketplace, folding-camping trailer manufacturers are taking steps to retain market share and regain some ground lost to the robust travel-trailer sector.
“I’m encouraged by things I’ve been seeing since the Louisville Show,” stated Mark Mazurek, director of sales and marketing for Fleetwood Folding Trailers Inc., Somerset, Pa., the nation’s market-share leader in folding-camping trailers. “I’m confident the camping-trailer consumer is still out there and that the market will come back.”
That turnaround may take some time, as foldout sales have been on the retreat for the better part of two years. RVIA wholesale shipment reports show a 22% drop in foldout shipments during the first 10 months of 2003 compared to the same period in 2002. And retail popup sales, according to Statistical Surveys Inc., fell 15.4% during the first 10 months of 2003 to 29,511 units, compared with 34,874 in the same period in 2002.
Manufacturers point to a host of variables contributing to the decline, including:
• Sustained low interest rates that have rendered higher-priced alternatives more accessible to the average, monthly installment-paying consumer.
• Shifting demographics.
• The growing availability of more lower-priced conventional and hybrid towable products.
• More segmentation in marketing and product design.
• The emergence of sport utility vehicles as a key family-oriented tow vehicle.
• Shrinkage of the nation’s manufacturing sector, which may have limited the buying power of the traditional camping-trailer consumer.
“The typical camping-trailer buyer was the hardest hit by an uncertain economy and the loss of manufacturing jobs,” said Gar Warlick, vice president and general manager of Viking Recreational Vehicles LLC, a foldout-making division of Coachmen Industries Inc. based in Centreville, Mich. “They were being conservative, while your midline consumer may not have been as affected.”
At the same time, Warlick noted, the prices of travel trailers and their derivative hybrid models began encroaching on price points and monthly finance payments previously reserved for camping trailers. “Travel-trailer prices, including the expandables, keep coming down while tent prices have not gone down,” Warlick said, noting Viking is the industry’s only remaining manufacturer that exclusively markets camping trailers. “The consumers wanted better quality and more amenities, so we began offering a lot of improvements in camping trailers that raised our costs.”
That situation was exacerbated by the Federal Reserve’s efforts to stimulate the economy by driving down interest rates. “Low interest rates have made it easier for consumers to step into larger, more expensive units,” Mazurek said. “There have been rumblings that situation will be changing (with interest rates rising), which would help bring people back into the market.“
The expanding SUV market has also been a key factor. Minivans were being forced off the road as consumers, particularly Baby Boomers, opted for hipper, heftier SUVs capable of hauling larger towable RVs.
“When people used to drive a minivan onto the lot, you would immediately show them a folding trailer,” said Steve Paul, vice president of sales and marketing for Dutchmen Manufacturing, Inc., Goshen, Ind. “Now all you see are SUVs, which can pull more weight.
“SUVs,” Paul added, “gave consumers more options.”
The SUV craze, in turn, led to variations in travel-trailer design as manufacturers capitalized on the influx of larger tow vehicles. One of the first innovations to fill the gap was the debut of expandable, or “hybrid” RVs, offering pullout tented bunks in a hard-sided trailer – a twist that amounted to the best of both worlds for many consumers because it offered the open ambiance of a folding trailer with the enhanced privacy and security of a hardwall trailer.
“We have seen a significant increase in our expandable business in the last few years,” said Paul, noting that Dutchmen, which exited the popup market last year, introduced its first hybrids in 1996.
“It was a declining market,” Paul noted. “From a manufacturing standpoint, we could better utilize our production space building expandables.”
Other manufacturers, however, remain committed to the fold-down market, as evidenced by the abundance of new introductions at the 41st National RV Trade Show in Louisville last month. Included in the new offerings were design trends that specifically target the expandable and travel-trailer markets, most notably the emergence of camping trailers featuring high sidewalls. According to Fleetwood’s Mazurek, the additional height allows for features that were previously only available in travel trailers, such as a larger refrigerator, oven, hard-sided shower and microwave.
Among the new foldouts at Louisville:
• Jayco Inc., Middlebury, Ind., introduced the 2004 Eagle Select camping trailer, featuring increased sidewall height – 34 inches compared to traditional 24 inches – for increased headroom and storage space. The high sidewalls allow for conventional-height countertops and create extra cabinet space for an optional oven.
• Fleetwood Folding Trailers split its Destiny product line, offering the entry-level SE series for the first-time buyer and the DXL line offering additional amenities. Fleetwood’s upper-end Highlander series now includes the high-wall Sequoia, which sports three king-size beds.
• Viking RV introduced two new models – the Epic 17.5 Limited Edition and the Sport 8.5 Limited Edition, which are just over 12 feet long, keying in on demand for ultralightweight RVs that can be towed by smaller vehicles. Both models are designed with amenities that promote convenience and comfort, with features like an all-new pressurized water system.
Don Walter, president of Starcraft RV Inc., Topeka, Ind., Jayco’s sister company, also spoke of a continued commitment to the fold-down market – for years the company’s signature product – despite a concerted effort by his company to diversify beyond foldouts. “The fold-down market continues to evolve and change, and it wouldn’t make sense for us to forsake camping trailers,” he said. “It is still a very viable product.”
Consumers’ growing demand for inventive, fresh product design, however, may pose another challenge for camping-trailer manufacturers, as several new product categories have evolved to steal market share from the traditional popup.
The most prominent trend is the emergence of sport utility RVs (SURVs), offering an on-board garage for off-road toys. “SURVs are no longer a niche product,” stated Bill Fenech, executive vice president of Keystone RV Co., Goshen, Ind., which doesn’t market products in the popup sector. “We consider SURVs to be mainstream.”
Camping-trailer manufacturers, at the same time, have countered by targeting the off-road crowd. Companies like Jayco and Starcraft, traditionally strong players in the popup market, are offering heavy-duty camping trailers built for the tougher terrain prevalent in certain regions of the country. “We’ve been having a lot of success with our RT, or rough and tumble, series,“ Walter stated. “It’s a prime example of being innovative. We just need to keep being creative and offer products that are new and improved.”