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Never shy about asking the tough questions, the staff of RV Business magazine and RVBUSINESS.com recently confronted our website visitors point-blank regarding their views on the RV industry’s prospects for the remainder of the year, given all of the variables at hand.
And we can tell you that the general sentiment, all in all, was neither dismally negative nor ecstatically positive:
* Despite some of the challenges the industry faces this year with escalating gas prices and high field inventories, in fact, fully 63% of the respondents say they’re still expecting a performance that is not that far off the mark – between five percent up or down – from last year’s record outcome at both wholesale and retail.
* A similar group of respondents – about 60% – took a moderate view of the country’s retail inventory situation, claiming that supplies of finished goods at dealerships nationwide generally “are larger than some might have liked, but OK.” An additional 25% feel that field inventories are “excessively large.”
* At the same time, record gas prices (39%) and economic uncertainty (38%) are the two factors that have had the greatest impact this year on the recreational vehicle business.
So, there you have it – lest anyone starts to view the cup half empty during a year when gas prices just keep edging up for a variety of reasons.
“The fundamental indicators are still extremely strong for the long term: Demographics, interest rates, fuel availability and terrorism angst,” one manufacturer responded. “Short term, the consumer confidence index is experiencing a temporary blip.”
“Fuel availability is still good,” says another respondent from the manufacturing sector. “However, the uncertainty of fuel pricing cuts into our customers’ discretionary income, and they tend to put off big ticket purchases.”
Says one thoughtful retailer: “RVs are an emotional buy. If we continue with the Go RVing approach to improving family and emotional well being by using RVs, we will continue to grow our market. We are competing for vacation dollars with other industries and need to focus on partnerships and marketing messages.”
“We are bullish on the market,” quips an unnamed dealer. “There is nothing that can beat the RV lifestyle for the investment for today’s new buyers as well as the seasoned RVer.”
“Fuel prices have had quite a bit of media attention and are certainly influencing consumers’ thoughts,” adds a voice from the manufacturing arena. “There was a great article in USA Today two weeks ago showing that gas prices, as it relates to average income, are actually a bargain. I believe the hype has a greater impact than the actual cost of fuel.”
“People are buying,” an outspoken retail dealer maintains. “They refuse to sit and wait for some foreign national to tell them what to do.”
“In the Northwest,” noted one of the numerous dealers responding to the electronic survey, “our dealership is up about 6% over last year. But, in talking to other dealers, most are down double digits from last year. I feel that we have been greatly impacted by fuel prices (the highest in the country) and that the industry as a whole nationwide will have a year slightly lower than last year’s record sales. I believe the direction of the industry is good. Yet we need to focus more on the twenty and early thirty-something age group. I feel most (dealers and manufacturers) are not focusing on teaching that age group what the RV lifestyle can do for them. In addition, I feel we should all be aware of the changes that are happening now. Too many dealers are living high and are forgetting what has happened (with industry down cycles) in the past and that it can and likely will happen again. When that happens, I’m afraid we will lose a lot of dealers.”
“I like that most companies are taking the time to give us a great selection of floorplans and new designs, trying to improve the floorplans year to year to give customers what they want.” another dealer adds. “The problem I see is that the companies I sell for took a pretty good hike up on invoice and option prices. By raising prices for dealers, we may lose some of the customers that have made the last few years so good for us (lower price point RVs = lower income buyers). That market for us has been key in our own dealership’s growth over the last few years.”
“Growth will continue,” adds a fellow who describes himself as a consultant to the RV park and campground business. “Smart operators will limit debt.”