High gas prices and rising interest rates may be pinching pocketbooks, but they aren’t keeping Americans from firing up their recreational vehicles or motor boats.
The Associated Press reported that RVs and boats are still relatively cheap getaways for both aging baby boomers and younger families. And global tensions are prompting more folks to opt for domestic travel instead of overseas excursions.
Nearly 8 million U.S. households now own some sort of recreational vehicle, according to a University of Michigan survey, an increase of 15% over the past four years.
The National Marine Manufacturers Association (NMMA) reports that 94% of American boaters will be on the water this summer.
But rising gas prices may lead vacationers to cut back on the length of their trips.
“Where they would take a trip 15,000 miles maybe they’ll take a trip 9,000 miles,” Winnebago Industries Inc. Chairman and CEO Bruce Hertzke said in an interview. “I don’t think you are going to get the American public to say, ‘I think I will stay home this summer.”‘
Pierre Pichette, spokesman for the recreational division of Canadian Bombardier Inc., said sales of Evinrude outboard motors and sport boats for the summer were on track, but dealers say customers may be cutting back on the length of their trips.
RV sales overall are near highs not seen since 1978, but one segment that is slowing is the higher-end motorhomes.
“Motorhomes are more expensive vehicles, they tend to be the first to decline, interest rates have gone up, and mortgage rates have gone up — it’s limited the cash financing that supported these sales,” said Richard Curtin, University of Michigan’s director of consumer surveys.
Forest City, Iowa-based Winnebago, which mainly makes motorhomes, has felt the pinch. Hertzke said high gasoline prices, higher interest rates and decreasing consumer confidence caused a slowdown in the industry that began in late 2005.
“I think you are definitely seeing a downturn,” Hertzke said. “We are just going through one of those cyclical periods, but I, like a lot of others, believe it will come back, and people will get used to paying $3 for gas.”
Hertzke said demand for mid-priced and entry-level units remains strong. Interest had also increased in more fuel-efficient vehicles that were capable of doing 17 to 19 miles per gallon.
“There will predictably be another case of withdrawal when prices take another significant hike, such as might result from the current Mideast conflict,” Tom Gonser, publisher of the Web site RVers Online, said in an e-mail.
According to the Recreational Vehicle Industry Association (RVIA), fuel prices would have to triple from their current level before RV travel is more expensive than other vacation options.