Two Indiana-based RV manufacturers responded late last week to the latest whole delivery reports from the Recreation Vehicle Industry Association (RVIA) reflecting a 42.5% decline in deliveries in September compared to last September.
Keystone RV Inc., based in Goshen, and Coachmen Industries Inc., based in Middlebury, had these comments, as reported by The Goshen News.
“Certainly, the RV shipments being down is of concern to everyone in the community and it’s something that we are watching very closely,” said, Ron Fenech, Keystone president and CEO. “At Keystone, our plans are to, in the short term, just accept the fact that over the next three to four months our dealers will very much limit the purchases of our product.”
“The thing we’re watching even more closely than wholesale shipments are retail sales. Although they are down quite a bit, they are not down anywhere near as far as the wholesale shipments, and that is good news. So looking ahead, our business will be very slow, at least until spring, and beyond that it depends on what happens with the national economy and consumer confidence,” Fenech said.
“I believe that there is good news in those numbers and in the face of all this economic turmoil that the industry retail sales have not fallen a lot further. The reason for that is the RV lifestyle for travel trailers and fifth-wheels has become ingrained with many Americans,” Fenech said.
“As the months unfold, this is what we’ll continue to track very closely and our expectation for next year is that it’s not going to be a great year, but we also don’t believe it’s going to be a terrible year,” Fenech said.
Fenech indicated the RV industry will see some solidification, but not necessarily an upturn, next year.
“I say that because I believe the U.S. government has to solve the credit bottleneck that is affecting every business in the country,” Fenech said.
“Our production will be quite slow in November and December,” Fenech said. “It’s typically slow this time of year. There’s not a good way to combat that.
“The reality is that the U.S. economy does have economic slowdowns and they do affect the RV industry. Fortunately, at Keystone, we are very strong financially, and are in a position to make good long-term choices that will make us even stronger when the economy comes back,” Fenech said.
Coachmen replied in this way:
“We continue to manage our production to try to make sure that we don’t produce things more than we have the capacity to sell, and we also continue to lower our costs in manufacturing because it creates a lower break-even point for us,” said Tom Gehl, vice president of Coachmen.
“I think that the issue has a lot to do with consumer confidence and the economy as well as the credit crunch that has occurred due to the problems in the financial industry,” Gehl said.
“If we can make an assumption that the economy is stable, I believe there is a pent-up demand that would create a rebound in the RV industry in the shorter run. If it is not stable, it’s difficult to predict when it will occur,” Gehl said.
“I think that there is a constant change in what people are looking for in order to be able to enjoy their recreational vehicles,” Gehl said.
“Coachmen has tried to be a leader in style and quality,” Gehl said.
Gehl gave examples of the Mirada, a Class A motorhome under $100,000 in price, and the Prism, a Class C motorhome that has been reworked to get gas mileage in the high teens — it has a Mercedes chassis and a Mercedes engine.
“I think that the opportunities are to expand and to find additional markets for Coachmen, which hasn’t traditionally been strong on West Coast,” Gehl said.
Coachmen recently signed a teaming agreement with a Chinese company to develop RVs specifically for the Chinese market to be manufactured here and shipped overseas.
“The best way to address a flat market is to look for new markets. It becomes a paradigm shift to a certain extent,” Gehl said. “If you’re trying to get more pieces out of a pie, you’re not going to be as successful as if you find a new pie.”