EDITOR’S NOTE: RVtravel.com is regularly invited to participate in nationwide conference calls with large RV dealers and others involved in the sales and servicing of RVs. We won’t be directly naming those on the call, nor the dealerships involved. While the situation is unusual, we feel the value of the candid comments and information that we can share with you outweighs the lack of the usual attribution. This time, you’ll just have to trust us that the quotes come from trusted, vetted sources.
RV dealers across the U.S. aren’t happy with a rapid series of RV price increases they’ve received from major RV manufacturers.
“Price increases seem a little out of control,” said one East Coast dealer during an industry-wide conference call this week. “For the year, the price increases have been close to 20 percent overall.”
Dealers said THOR Industries, the world’s largest manufacturer of recreation vehicles, seems to be the major culprit in running up prices, but they aren’t alone. “THOR is definitely higher than everyone else,” the dealer said.
Why the price increases?
What makes the price hikes particularly onerous to RV dealers is that the huge backlogs and delays in manufacturing sold units at all RV plants have extended the time from order to delivery to up to eight months or more. If a dealer “locked in” the price with a buyer at the time of the order, each price increase along the way erodes the dealer’s profit margin.
“I’m seeing 30 percent increases in pricing on certain products,” said another dealer on the conference call. “I can no longer lock in prices for consumers when they order. I can’t tell them what the unit they want will eventually cost.”
The dealer said he suspects some of the cost increases from factories are being driven by the price-gouging that manufacturers are seeing from their own parts suppliers. “The manufacturers are making it up by sending out price increases monthly or sometimes even twice a month.”
What about shipping costs?
One Oregon dealer said he’s also getting “hammered” on shipping costs for RVs, which he said have increased more than $6,000 per unit in recent months. “Price increases are going through the roof, and manufacturers haven’t offered us any price protections for the last seven months.”
He said that, so far, his company has not passed the unit price increase or the shipping costs along to the consumer. That policy sometimes leaves his firm selling new RVs at a loss. “We don’t feel we can pass the costs on to buyers because we just can’t document why they are increasing the prices,” he said.
For now, manufacturers and most dealers are getting away with price increases since the demand for new RV units remains at record highs.
One dealer said he’s concerned the high demand will begin to wane as customers tire of waiting “long term” for their units to arrive from the factories. “The demand curve will eventually soften,” he said. “At that point, we’ll likely see that we’ve priced some people out of the market.”
COMING NEXT SUNDAY: Roadside assistance companies stretched thin by huge growth in RVers and lack of available service centers