RV manufacturers will soon feel the impact of sharply higher prices for steel and plastics, according to two supplier firms: Drew Industries Inc. and Myers Industries Inc.
Since mid-December, Drew, parent of towable RV chassis supplier Lippert Components, has been “notified by its steel suppliers of unprecedented steel price increases, which have now aggregated more than 60%,” according to a statement issued by Drew on Wednesday (Feb. 11).
“This situation apparently arose as the result of an increase in worldwide steel demand, particularly in China,” Drew reported. “In addition, due to the weakened value of the U.S. dollar, which has declined about 15% versus the Euro over the last year, it has become uneconomical to import steel.”
Because of higher steel prices, Drew has “raised prices to customers, which will now have to be followed with a second round of price increases.”
The amount of the price increases was not revealed in Drew’s statement.
Meanwhile, plastics supplier Myers reported today (Feb. 12) the cost of high-density polyethylene plastic increased an average of 36% in 2003, and was continuing to rise in the fourth quarter.
“To help mitigate the increases in resin costs, we continue to make gains in productivity, volume purchasing of raw materials and streamlining manufacturing operations to a leaner profile,” said Greg Stodnick, Myers’ vice president of finance and CFO.
“We believe there are opportunities for further cost management improvements, but, ultimately, we will need to receive higher prices for the value we are creating for our customers,” Stodnick added.