After a somewhat tepid response to President Barack Obama’s comments at a town hall meeting in Elkhart, Ind., on Monday (Feb. 9), RV industry executives have expressed much greater optimism about their industry’s future.
Events over the last 24 hours added more substance to Obama’s Elkhart address, according to several key industry people interviewed by RVBusiness. Last night, Obama held a national press conference showing in greater detail his understanding of the credit crisis. And today, Treasury Secretary Tim Geithner sketched out the broad strokes of the administration’s attempt to stabilize the financial sector that will provide $100 billion in seed money to expand the Federal Reserve’s Term Asset-Backed Securities Loan Facility (TALF) – a move that is designed to ease credit. Also today, the Senate passed its version of the stimulus package by a vote of 61-37.
“I was very positively impressed,” said Jim Sheldon, Recreation Vehicle Industry Association (RVIA) chairman. “I think it demonstrated an awareness on the part of Washington toward the dilemma we find ourselves in. I was very encouraged by what he had to say, reaching out to the folks that were there that he intended to push forward on initiatives that will help our industry.
“I’m very excited about all this. The ball is not in the end zone – there is a lot of work that has to be done. But there are a number of things (in the package) that I feel were initially intended for the auto industry that, hopefully, will benefit us too.”
Sheldon said he was preparing for a conference call later today during which the RVIA executive committee will review Obama’s stimulus package and how it will help the RV industry. The committee also was going over its own financial status for the next two years while also getting an updated shipments forecast.
Past RVIA Chairman Carl Pfalzgraf has reviewed the stimulus package and also was heartened by the plan. He emphasized that the TALF financing could directly help RV dealers obtain floorplanning.
As for RV manufacturers, Pfalzgraf sees Obama’s “green” initiative playing into the hands of companies already designing vehicles that are lighter and easier to tow and incorporating building materials that are more eco-friendly.
Bob Olson, chairman, CEO and president of Winnebago Industries Inc., Forest City, Iowa, also said he was encouraged by recent events. By Obama visiting Elkhart and then mentioning the RV industry during his press conference, “he brought the RV industry’s dilemma to the nation’s attention, and the attention of Congress and the Senate.”
Olson added, “One of the things I was most encouraged about was he explained at last night’s press conference that our problem is with financing. What that tells me, is he gets it. That is the first part of getting a problem resolved.”
Olson said he would withhold final judgment but is keeping his fingers crossed that “this will be enough of a stimulus to allow some of our potential customers to buy our products.”
“I don’t know if there will be one single thing that will help our situation,” Olson said. “My fear was that we were going to be left in the dust of the auto industry and financial institutions. With yesterday’s activities, I think that opened the door up for the RV industry.”
Olson, who called himself “a staunch Republican,” added, “I think a good portion of what we’re in today is psychological. If he (Obama) can turn that around with his charisma, we have half this battle beat.”
Bob Tiffin, president of Tiffin Motorhomes Inc., Red Bay, Ala., also was encouraged by Obama’s presentations, but he surmises it will be several months before consumer confidence rebounds.
“We can do all we want to,” he said. “We can fix the banks so they can loan the money and give good rates and lower the credit score to whatever they want to. But if customers won’t come up and buy, it’s to no avail. It will take a long time before consumer confidence comes back to our customers.”
Tiffin said Obama’s discussion of projects like road construction and creation of alternative energy sources are things “we can use forever. That will do a lot to stimulate the economy.”
“But,” he added, “the stock market will have to get up two or three thousand more points before people get any confidence, and people will have to get hired back to work. I have an idea we’ll be in this another 18 months before it gets much better.”
But in the same breath, Tiffin said the rebound could be much quicker.
“Sometimes the most severe punishment you get over the fastest and hopefully that’s what we got,” he said.
Mike Molino, president of the Recreation Vehicle Dealers Association (RVDA), noted: “He didn’t say anything negative about the RV industry. In fact, last night at his press conference he talked about the frustration of getting an RV loan, which I thought was very positive.
“My concern has been for years that the RV industry would lapse back into the situation where it was unpatriotic to buy an RV because of a lot of reasons, one of them being the energy usage and the environmental impacts, which, unstudied, look like they’re not very positive. But if you study RVs, you realize that it is a positive and that we have a lot going for us there… I think we had a major turnaround yesterday.”
Molino also said he can’t remember the RV arena taking such a central slot in the national political spotlight.
“The closest was during the first Bush administration,” he said. “He kind of had an affection for us, and he was really positive.”
Molino summarized, “From our standpoint, in trying to influence the government to be positive toward the industry, that (the Elkhart stop) was tremendous. Yesterday morning – and what he said last night in the speech – I was overjoyed that he used purchasing an RV as an example of the economic situation as far as loaning money is concerned.”