El Monte RV believes the rental market will be so strong that some of its suppliers will be unable to produce enough motorhomes to fully stock its rental operations this summer, said Joe Laing, director of marketing.
A sharp increase in RV rental reservations from Americans is the reason why El Monte could run short of motorhomes this summer.
Five years ago, 80% of El Monte’s business came from visitors from outside the U.S., but its domestic business has been increasing steadily since then. But shortly after Sept. 11, the company reduced the size of its fleet in anticipation of a sharp decrease in international travel.
However, domestic business now accounts for 80% of El Monte’s volume. “There never have been more domestic customers trying out the RV lifestyle,” Laing said. “Because of the enormous increase in domestic rentals, we are buying more fleet. We have placed sizable orders with Winnebago and Four Winds (a subsidiary of Thor Industries Inc.).”
However, certain manufacturers said they will not be able to supply enough units to satisfy El Monte’s projected demand, so the company apparently will be somewhat short of product this summer, Laing said.
El Monte, which operates 14 company-owned stores, has greatly expanded the number of its licensee locations for this travel season. It will have 36 licensee locations as of May 1, compared with 11 a year ago.
The are no plans to add any more El Monte licensee locations between May 1 and next fall, Laing added.
“Our bookings are up significantly,” he said. “More importantly, our rental revenue is up. It was up 53% in February and 42% in March.”
The recent sharp rise in gas prices has not dampened the demand for RV rentals and Laing does not believe it will “unless gas prices go up significantly.
“During the summer, people realize they generally have to pay more (for gas) to go on vacation because of demand,” he said. “And when you consider that the average motorhome vacation costs around $2,250, not including food and campground fees, even a substantial increase of $1 per gallon would amount to less that a 5% increase in the total cost of the trip.
“Rental demand was strong last summer when gas prices were even higher,” he added.
The latest crisis in the Middle East also is not hurting demand. In fact, Laing believes it is “a net positive for RV-related travel in general. RV vacations make people feel more in control,” he said.