The country’s largest RV consumer show went off smoothly last week, dangling dreams before a sea of onlookers over five days.
As reported by the St. Petersburg Times, the Florida RV SuperShow drew more than 44,000 to the Florida State Fairgrounds. That’s a hiccup down from last year’s 48,000, but still healthy by any standard.
The RVs ranged from closet-sized trailers selling for $6,000 to luxury coaches that went for $2.2 million. All promised freedom from domestic captivity and membership in an RV lifestyle all its own.
“It’s a subculture of America,” said Dave Kelly, a spokesman for the Florida RV Trade Association (FRVTA), which sponsored the event. “Neighbors knock on doors, introduce themselves and share leftovers. The kids play together while the adults compare travel notes under their awnings.”
Not like the suburbs from whence they came or a motel, either.
The idea of combining tourism with rootedness is appealing for all sorts of reasons. It seemed especially apt for a more adventurous wave of Baby Boomer retirees, some of whom have joined the ranks of “fulltimers” who live in their RVs year-round.
But recent economic trends have hit the RV business hard. Loans are suddenly harder to get. Nest eggs meant to underwrite travel have cracked. Plummeting gas prices —- whoops, that was five minutes ago, now they’re headed back up — have brightened the industry’s outlook just slightly and not for long.
RVs are big business in Hills­borough County: It’s home to about 60 of the state’s 100 dealers. Lazydays RV SuperCenter, the nation’s largest single location dealership, is in Seffner.
“Six months ago, a lot of our people could buy anything they wanted,” said Lance Wilson, FRVTA executive director. “Now, they can’t get a loan.”
That’s not fair, he contends, since lenders that will receive more than $700 billion in federal bailouts haven’t loosened their purse strings as a result. Now RV groups are urging their members to get Congress to exert pressure to relax suddenly strict lending standards for RVs.
According to the Times, one part of Wilson’s assessment seems undeniable: The RV industry took a hit last year. RV shipments dropped 28% from 2007 to 2008, according to the Recreational Vehicle Industry Association (RVIA), which expects shipments to dip another 25% in 2009.
Banks report a 10% drop in RV loans financed, said RVIA spokesman Kevin Broom.
“The other issue is that consumers are concerned about the future, and so they are postponing decisions on buying an RV,” Broom said. Yet RV customers default on loans half as frequently as other kinds of consumers, according to an eight-year study by the American Bankers Association Quarterly Delinquency Bulletin.
The effect of a credit crunch on sales has been immediate. Even when customers are approved for loans, interest rates have jumped since mid 2008, from around 5% to 7%, dealers say.
“They have not loosened up on the creditworthy people. In the least, they have not,” said Tom Johnson of Marion, N.C.
The owner of Tom Johnson Camping Centers has been in the business 42 years. “I’ve seen 21% interest rates,” Johnson said. “I’ve seen recessions. I’ve seen a gas shortage. I’ve seen it all. But I’ve never seen anything like this.”
The Times reported that any change in the RV market affects Florida, which consistently rates second through fourth in incoming shipments, according to the FRVTA.
Inside a bustling convention hall, one booth sat nearly idle — for RV financing. Thomas Spirito of Gulfcoast Funding said that the new toughness will ultimately help the industry.
“Gone are the days when you could get a no income-verification loan with a credit score of 750 or above,” Spirito said. Instead, get ready to fork over two years of tax returns, have your debt-to-earnings ratio scrutinized and then put 15% to 20% down.
“It’s back to basics,” Spirito said. If customers don’t qualify for the RV they wanted, they still might be able to purchase a cheaper one, he said.
Nestled among the onlookers were customers long since satisfied. Bill Wright, 59, and his wife, Barbara, 58, left their Peachtree, Ga., home three years ago to live full time in a motor home. The Wrights, both retired salespeople, figured they would try the RV lifestyle for five years. They traveled 200 miles at a stretch up the Atlantic coast to Canada, staying at each campground a week at a time before moving on.
“After the first year,” Bill Wright said, “we decided it’s going to take more than five years to see all of the places we want to see.”