Update: My Predictions for Future of the RV Industry

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January 4, 2010

In February of 2009 I wrote an article titled “My Top 5 Predictions for the Future of the RV Industry”. I thought that since nearly a year has passed this would be a good time to take a look at how my predictions faired. In the original article I mentioned that the RV industry has endured many hardships in the past; recessions, high interest rates for consumer lending and dealer floor plan payments, the high cost of fuel and that it has always rebounded. To come back stronger than it was before requires innovation, change and forward thinking on the part of its leaders in all sectors of the industry.

To read my first article go here

Now let’s take a look at my past predictions and current conditions.

My #5 Prediction:

The weak will not survive. Whether it is a manufacturer, dealer, campground or aftermarket supplier only the strong who are committed, determined and willing to change with the times will survive this current downturn.  It will require downsizing operations, inventory, and making good solid business decisions. Back to the basics! In the long run this will make the remaining companies better, stronger and more adaptable to change.

#5 Update:

The list of U.S. RV manufacturers that are no longer in business or have filed bankruptcy has exceeded 20 since the recession began. As of June 2009 approximately 160 RV dealers across the country closed their doors for good. The remaining 95 or so U.S. RV manufacturers and 2,900 RV dealers have done what was necessary to stay in business through the worst of the recession. Manufacturers and dealers alike scaled back operations. Dealers lowered inventory levels resulting in fewer RV’s being manufactured, and the survivors made wise business decisions in anticipation of a turnaround.

My #4 Prediction:

RV manufacturers will need to improve on the quality of RV’s. As a society Americans are more and more demanding that the products they purchase are of the highest quality. This is especially true of major purchases. Modern technology focuses on better quality products, from cell phones and computers to automobiles and RV’s. Some RV manufacturers, not all, need to address the issue of higher quality in its product offering to remain competitive in the future RV market. The current economic crisis will help weed out some of the poor quality products.

#4 Update:

RV dealers and RV manufacturers survive in large part on repeat business. The RV dealer strives to get the new first time RV buyers business and to become their dealer of choice. The RV manufacturer wants the first time buyer to purchase another one of its product offerings when it’s time to upgrade.  This competitiveness between manufacturers, especially during a recession, results in design improvements, advanced technology and better quality RV’s being manufactured.  As manufacturers compete for repeat business and consumer loyalty the quality of RV’s will continue to improve. I personally have owned five RV’s, and four of them are from the same manufacturer, Fleetwood.  The interesting thing is that if there is a sixth RV in my future it will probably have to be a manufacturer other than Fleetwood since the towable division is gone for good and the motorized division was sold and is under new management.

My #3 Prediction:

Along with better quality built in the product comes better warranty and better customer service. I have experienced RV manufacturers with outstanding warranty programs and others who barely stand behind the product it builds. The same holds true with customer service, but a large part of customer service is dependent upon the RV dealer selling the manufacturers product. The days of only servicing a customer’s unit if they bought it from me mentality are over. If RV dealers want to stay in the future RV marketplace they better show it in how they treat and service the customers who walk through the door. Think about it, if you had a bad customer service experience in the past do you return to that company to do business in the future?

#3 Update:

When RV sales figures drop drastically RV dealers need to find ways to make up for the loss in profit if they want to stay in business. RV dealers, for the most part, consist of three different entities; the sales department, the parts department and the service department.  It’s no secret that the sales department is the primary source of income for RV dealerships. The savvy RV dealer must find ways to increase the profit level in the service department when sales figures are off. That is exactly what many RV dealers did during the recession. They realized if consumers weren’t buying, or couldn’t buy RV’s, that people who already owned RV’s would have more reason to maintain their current RV. The smart RV dealer not only concentrated on taking in more service work, but on improving customer service across the board. The really smart dealer offered to work on the orphan RV’s for owners whose RV manufacturer folded during the recession. What better way to improve customer loyalty and repeat business when RV sales pick up again.

My #2 Prediction:

Borrowing money as we know it will probably never be the same again, and that is a good thing. Banks that loan money need to be more responsible. I won’t get into my take on us, the taxpayers, bailing some of these institutions and people out.  Loaning more than a property is worth, loaning to consumers you know cannot afford to repay the loan, overextending borrowers and allowing consumers to be so upside down in an auto or RV loan are all poor business practices. You can see where it got us now. A reputable RV dealer builds its business on repeat business. You sell a customer their first RV, say a pop up, treat them fairly, provide good customer service and they will return to that dealership when it is time to upgrade. The average RVer will own four or more RV’s in their lifetime. A dealership cannot stay in business or remain competitive if the consumer finances way more than the RV is worth and cannot sell or trade it in the future. Criteria for lending money has already tightened and will stay that way in the foreseeable future. RV dealers who want to get their fair share of the market will need to be more responsible when it comes to making sure consumers will in fact be future repeat customers.

#2 Update:

Banks not lending money is probably the biggest remaining hurdle for the RV industry to recover from the current recession. RV sales projections are up for 2010, RV manufacturers are hiring more employees and ramping up production and consumer confidence is improving, so, why aren’t banks loaning money to qualified RV buyers? I read somewhere recently, but can’t find it now, that prior to the recession 7 or 8 out of 10 RV loan applicants were approved. During the recession only 3 or 4 out of 10 RV loan applicants were being approved.  Prior to the housing industry meltdown, subprime lending fiasco and all of the corporate greed, these lenders were too open to lending money, but now it seems they have ridiculously overcorrected the initial problem. If a consumer qualifies for an RV loan why won’t these banks lend the money? We the tax payers were forced into bailing out many of these banks. The reason for the bailout, at least the way I understood it, was to not only cover all of their bad debt and keep them from collapsing, but to get them back to lending money to qualified buyers. Somebody in the current administration needs to force the banker’s hand to start lending money to qualified buyers if we plan to boost the economy as a whole.

#1 Prediction:

Whether you like it or not everything is going green. I don’t know how anybody cannot realize this, but RV manufacturers especially need to take heed. I grew up during an era of muscle cars; where horse power and speed were more important than fuel economy.  But for the future of the RV industry bigger is not going to be better. RV manufacturers need to downsize! Smaller, lighter and more aerodynamic travel trailers and 5th wheels will be in demand. Not only for better fuel efficiency but quite possibly because there won’t be any vehicles manufactured that are capable of towing heavier models in the future.  Motorized RV’s will be smaller in size with more fuel efficient power plants capable of burning alternative fuels or running off renewable energy.  The focus will shift from models with 5 slide outs to streamlined models capable of 15 mpg or more.

#1 Update:

This prediction is evolving as I write this article. The 2009 National RV Trade Show in Louisville, Ky. rolled out some aerodynamic, lightweight, fuel saving RVs of the future. This lets you know that there are innovative forward thinkers in this industry poised to come back strong when the economy rebounds.

RV industry veterans have lived through similar hardships in the past and witnessed tremendous growth afterwards.  As difficult as it has been for the past couple of years it is quite possible that this will be a factor in the RV industry being even stronger in the future. It is my prediction that 2010 will be the turning point to renewed growth and prosperity for the RV industry.

Happy Camping,

Mark Polk

RV Education 101

RV University

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49 comments

  1. Like your predictions. The one regarding quality is near and dear to my heart. I purchased a Big Horn 5th wheel about six months ago. We have had many problems with the camper that can be attributed to poor or no quality control. What if have heard from other RV owners is pretty much the same when it comes to no quality control in this industry. If you pay good money for a product, you should expect good quality from the manufacturer. This idea that trailer products traditionally are of poor standards needs to go away. Those who produce poor quality products should go away! My trailer has been in the shop more than I have had it to use. NOT GOOD!

  2. Don Turner

    I purchased a Coachmen and I think I was delivered a trailer put together by a vocational class of school kids. Light assy.in ceiling was crooked. Both 12 volt lights in slideout will not work for the second time., trim on the walls come loose, the water supply line to toilet was loose and leaked’ There were numerous large bubbles in the rubber roof. Coachmen and the selling dealer told me they were within limits. Another dealer told me when they were fixing the leaks after the “Pass The Buck” warranty ran out that he had never heard of allowable bubbles like I had. Circuitbreaker controlling the slideout behind the battery is not mentioned in any of the manuals or papers given to me. I will never buy anything made by Coachmen or any other brand name they may have.

  3. Charles Barsavage

    Hi, I agree as well about dealers and Quality, We purchased a Dutchmen Colorado 5th Wheel and its only 2 months old. Lots of problems, sliding bathroom door fell off, ceiling panels are stained, day/nite shades are broken, cupboard door latches the screws are stripped out. The insulation in floors and walls suck, paid $51,000, traded in a 2006 30ft Cardinal 5th wheel and put cash down and got a loan for $20,000 thru Camping World, problem is they say my rig is only worth $30,000 if I Trade out of it because of its quality, sad. Oh and Dutchmen says warranty is void if the rig is your full time residence, no one told me that. The sales people at camping world don.t want return business they just want your money NOW. We are fulltime workampers and there are lots of us out there, rv dealers need to offer a lot better quality and price, with no song and dance and hard sell, we are not stupid, Charles

  4. Berni McEneaney

    Hi there,
    I am a soon to be newbee in the RV arena and am looking for my first (used) rig. I have been looking at 38/40ft diesel pushers with spartan chassis and allison trans, just me traveling and occassionaly with my two older teenage boys. I am 49 yo and intend to start out with trips with a view to eventually going full time.
    After reading your comments (which are most helpfull) and speaking with other rv’rs I am now more skecptical than ever. Where I am a cautious buyer of anything, and research my purchases to the n’th degree I am finding this business no different than the second hand car sales business but with a blind fold on and a in a forign language to boot.
    I am looking to spend between $50 and $100,000 but am becoming so overwhelmed. I intend to visit some RV expos, one in Providence RI in Feb and any others that are recommended.
    Any advise would be most welcome.
    Cheers
    Berni

  5. Jody

    We purchased a 2007 Holiday Rambler in Nov. 2006 after trading in our 1998 Holiday Rambler, thinking they where still quality. Wow what a joke, Monaco needed these hard times for a wake up. We spent 120 days in the service center, not fixinig problems only replacing parts. We are not pickey people, just wanted thinks to work as designed. Thank goodness they had service centers and the factory in different parts of the country, we hopped from one to the other with these stops being our major goal, so much for 1 year seeing the country, and we still had to pay to have some things fixed on our own since the 1 yr warrantry ran out and they went out also. We have a good side to all this, we met many people that had the same or worse problem, and started a lasting friendships with many.

  6. rag

    Mark,
    Good article!
    Hang in there with your Fleetwood hopes. Our next one may not say Fleetwood but with the buy-out it should still have the Fleetwood quality. I have owned two of them in the past and plan on staying with the model, if I can find it, for my next coach.
    I’m having a little more of a problem with the “green thing” that most. I think we are pushing the envelope on alternative fuels and the industry needs more time to develop alternative sources of power. In my opinion corn squeezins should be drank and not burnt!!!

  7. Tom

    I sold my 2002 Skyline Celebrity and replaced it with a 2009 Outback. The Outback is a huge disappointment. Outback has to be the lowest quality RV in existence today. Whatever you do, do not buy an Outback.

  8. richard Gerber

    I have been RVing for about 35 years and have just about seen it all. I haunt RV shows and make a pest out of myself. Well, all my fun years are finally coming to fruition. I have retired from state service and we will be full timers. Here is my 2 cents. Research what your goals are then do it. Spare me from salesmen; go sell cars. If you are going to sell RVs , know what you are selling. When I ask a question and all the guy wants to do is close me, I am gone. They give everyone a bad name. I found , after all these years, one manufacturer; Heartland and bought a landmark Grand Canyon. Only one dealer; RVs For Less in Knoxville. Talk to Butch, the only guy I know who knows more than me about RVs and goes the extra mile. Only one hauler guy, Classy Chassy; Tom Martin. Good luck. Rich

  9. Ed Schmidt

    Hi: We have using hardsided RVs for extensive traveling since 1978 and have owned 5 fifth wheels and 3 class A motorhomes. We full timed it for several years and now half time it. The only brand of RV that had any appreciable construction quality was the first 2 of 3 fifth wheels from Alpenlite. After they got into the luxury Class A business they stopped paying attention to trailer quality. Other than that all my RVs have been new and I averaged 2 type written pages of initial construction problems. I negotiate away the dealer prep charge in the contract, when possible. As for going green, the global warming caused by humans has now been shown to be a hoax. Going green otherwise is a waste. The US has the worlds largest proven coal deposits, shale oil and very extensive regular oil deposits on and off shore. Quit trying to appease the world and look out for the good ol USA!
    Ed

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