There’s nothing like a Presidential election to spur debate on serious issues and, among U.S. businesspeople, on the possible effects of those elections on the fate of commercial sectors nationwide.
The betting line among attendees at the the 41st Annual National RV Trade Show, Dec. 2-4 in Louisville is that the U.S. economy will continue to build momentum as the election campaign swings into high gear.
“I don’t know if the actual election will have that much of an effect,” speculates Winnebago Industries Inc. Chairman, President and CEO Bruce Hertzke. “But in an election year, the politicians work harder to get the economy going in the right direction.”
This is particularly true when an incumbent president is running for re-election, asserts David J. Humphreys, president of the Reston, Va.-based Recreation Vehicle Industry Association (RVIA). “When an incumbent runs for re-election,” he said, “the odds of the economy being strong around the time of election are overwhelming. The whole administration is just pushing and pushing and pushing.”
“The president has an interest in making sure the economy is moving forward,” agrees Gary Groom, president of Thor Industries Inc. subsidiary Damon Motor Coach. “If the economy is good, highly discretionary purchases are more likely to be made.”
Of course, the economy has already gained considerable strength in recent months, he noted.
“There was a lot of speculation about whether the economy was going to improve about three months ago,” Groom said. “Now, we’re seeing the numbers come in that say, ‘Yes, it is improving.’ The GDP numbers were in the 7% and 8% range in the last quarter. I think that just bears witness to the fact that a presidential election is coming.”
Several factors have set the stage for stronger economic performance in Groom ’s opinion, including low interest rates, tax cuts and readily available fuel.
“I think the current administration is doing everything they can to put the economy in good shape prior to the election,” said John Nepute, president of Coburg, Ore.-based Monaco Coach Corp. “People are more focused on the economy to make sure that it’s doing what it’s supposed to do for manufacturers and dealers.”
Bob Tiffin, founder of Tiffin Motor Homes, Inc., Red Bay, Ala., shared this perspective.
“I think, historically, during an election year, we’ve always done real well,” Tiffin said. “I think we’ll (re-) elect President Bush and I think that will be a plus for the country and a plus for the economy. I think that will help our business.”
Some RV manufacturers believe the economy is gaining so much strength that the presidential election may not have that much of an impact on the RV business.
“Historically, the election year is thought to be a good year typically for the economy,” said Ron Fenech, president and CEO of Keystone RV Co., another Thor subsidiary. “But I think with this upcoming year the election is not going to be a factor. I think the economy has so much momentum right now that it’s just economically in the United States going to be a very strong year.”
Fenech noted that Keystone has seen its sales increase by more than 50% during the past two years, with 2003 sales expected to top $700 million.
Several RV manufacturers, in fact, say they are experiencing unusually high demand for their products. Riverside, Calif.-based Fleetwood RV, for example, has experienced some of the strongest autumn sales ever, particularly in Indiana, Maryland and Virginia, said Fleetwood President and CEO Edward Caudill.
Meanwhile, Kropf Industries, a Goshen, Ind. manufacturer of recreational park trailers, is experiencing some of its strongest sales ever. “Our business has never been stronger (than) over the last year or two years, and I see nothing but extended growth,” said Kropf Vice President Curt Yoder.
Duane Spader, founder of The Spader Companies, a Sioux Falls, S.D.-based consulting firm, said the economic rebound also is affecting other sectors of the economy, including the charter bus, tour and office furniture businesses. “I just finished a series of 20 group meetings with (nine) different industries and all of them just feel real good at this time,” Spader said.
Regardless of what happens in the elections, RV sales will ultimately reflect the extent of consumer confidence in the national economy, said Dick Parks, president of Nappanee, Ind.-based Newmar Corp. “If people feel like they have the wherewithal to go out and spend money on RVs that are not necessities, we will continue to do well,” he said. “I don’t know about the politics of it. But if people feel they are doing well economically, that’s good for our business.”
“What is it that drives the economy?” asked Bob Lee, president of Country Coach, Inc., a National RV Holdings Inc. subsidiary. “I think it’s an attitude.”
Country Coach, he said, has seen nothing but growth during the past year and a half, a positive trend that has been reinforced by his company’s signing of several new dealers at the recent Louisville show. “2004 is going to be a good year for us,” Lee said. “2005 is going to be an excellent year.”