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Production cutbacks and shorter work-weeks in the recreational vehicle industry are causing concern in Indiana’s Elkhart County and the surrounding region, according to a report by WNDU, a TV station in South Bend, Ind.
The RV industry has long been looked at as a bellwether of the larger economy, and a year ago, the RV industry was doing exceptionally well.
Travel trailers were being made and shipped as fast as possible to provide emergency housing for hurricane victims, but this summer, there have been no hurricanes – and no hurricane orders.
“The industry is going through a rather unusual period of time,” said Sherman Goldenberg, publisher of RV Business magazine. “High gas prices, high inventories, and high interest rates are having an impact on RV sales. Motorhome sales are down 12%.”
Towables are down just 0.2%, that, after the best year in industry history.
“The anomaly is really important that people realize this is not your classic ‘we’re all going to hell, 1973 type situation’ – people fall into that,” said Goldenberg.
IUSB business and economics professor Grant Black agreed, noting, “I think it shouldn’t be a cause for big alarm. I think the outlook for the industry still looks pretty good, particularly in the short term. I think 2007 may not be as strong as this year, and the last couple years, but I think I think it’s still going to be near those high record levels.”
Changes similar to those seen in the auto industry – smaller cars, hybrid engines – could happen to RVs as well.
“People are going to start altering their behavior,” said Black. “We’ve seen it in the car industry where demand for trucks and SUVs has just plummeted. People are looking for cheaper alternatives, more efficient types of vehicles, and I think you’re going to see that translate into the RVs.”
Goldenberg noted, “No, there hasn’t been anything like this, and it raises a lot of questions of where things are headed.”
The RVIA National Trade Show in Louisville at the end of November could be the place where RV makers show new ideas – perhaps smaller travel trailers or more fuel-efficient motorhomes. Like the auto industry, the RV industry may be changing to suit new demands.