This week, an RV industry insider with decades of experience floated his opinion on what 2024 holds. He sees tough times for RV dealers. How will RVers be affected—particularly those who are in the market to buy?
Not his first rodeo
Gregg Fore has been in the RV industry for a long time. He was the president of Dicor Products, served 19 years on the board of the RV Industry Association, and is an inductee to the RV/MH Hall of Fame. In other words, this isn’t Fore’s first rodeo. His candid comments on the present state of the RV industry and its future bear looking at. His comments were published in RVBusiness.
COVID—and was it greed?
Fore doesn’t mince words, leading off by declaring that the market is “mired in a longer-term stagnant market than everyone originally forecast.” How did it get there? Fore points the finger at an “overzealous market resulting from COVID [that] stole future purchases.” When the big pandemic struck, Fore says many who’d already been thinking about buying an RV hurried ahead and did so. As readers recall, during COVID times it was difficult to find an RV to buy, and prices blew up exponentially.
When COVID relaxed its grip, sales dropped out. The market was saturated. RV dealers who’d bought 2022 models, with high price tags, were suddenly stuck with white elephants. There weren’t enough buyers, particularly for rigs with high costs. Then inflation caused the Fed to raise interest rates. Slow sales, high flooring interest rates, increasing employee wages, all things seemingly conspired to knock the legs out from under RV retailers. The RV roller coaster ride was plummeting in that “hold onto your stomach” descent.
Fewer features, cheaper materials
In his opinion piece, Fore then shows what manufacturers did. “OEMs in declining markets always seem to revert to the same methods used in past periods—de-contenting products, using less expensive substitute materials, etc.—all in an attempt to ‘buy’ shelf space at their dealers and keep factories running at some level.”
How does Fore view those manufacturer moves? “While ‘racing’ to the low end always has some level of success in a stagnant market, that ploy also has limits. And I believe there are few long-term benefits of the low-price strategy because, as consumers continue to desire features, they are less attracted to de-contented vehicles. Yes, there will be sales, but little market growth. Mostly, dealers and manufacturers will be treading water waiting for the next market recovery.”
For buyers: good news, bad news
Let’s stop and inject you, the potential RV buyer, into the mix. “De-contenting products” says “cut back on the whistles and bells” to us. The fewer whistles and bells, the lower the price. If you aren’t interested in buying “bling,” this could be a good thing. On the other hand, “using less expensive substitute materials” could spell trouble. Even before COVID came calling, RVers were loudly complaining about poor workmanship and low-end materials that left “new” rigs sitting at the shop, sometimes for months on end.
In the market for a new RV? If you don’t mind fewer “features,” it may be a good time to look at a purchase. But we’d strongly recommend spending the extra money and hiring a reputable RV inspector to go over your potential rig purchase. One way of “racing to the low end” also translates to “racing the rig out the door,” and nobody wants to buy a trash RV.
And on the subject of financing
Still, you may fall into the group that Gregg Fore now speaks of. “Today, the consumer is taking on more debt and reducing savings to maintain lifestyles. Meaning they are less likely to splurge on a new or used RV.” If you haven’t saved enough to either pay cash or cover a large portion of an RV purchase, you may be out of the market. For heaven’s sake, DON’T be taken in by the happy finance manager who chirps about low payments through the miracle of long-term financing. Sure, finance your rig for 15 or 20 years, but if it falls apart in five, you’re really on the hook. These may be tough times for RV dealers, but they don’t have to be for you.
If you are paying cash, or putting a big lump sum on a down payment, the dealer probably won’t like you. When they “help secure financing,” it usually means a kickback in the back room. Don’t tell the salesman you’ll pay cash. Keep that under your hat until you’ve secured a signed offer.
RV dealership landscape changing
In Fore’s view, the literal RV dealership landscape may be a-changing. “The “cash crunch” at RV dealerships has escalated over the past 12 months and will likely continue into the future. Margins on sales have dropped, the costs of nearly everything have risen, and maintaining safety in cash flow is more critical than ever. Some dealers will see the handwriting on the wall and close voluntarily rather than lose their entire personal asset base. Others will be forced to do the same as cash flow reaches critical levels. These will be tough times for RV dealers. As dealerships slam their doors, competition will cinch up, and of course, the number of places to get broken RVs fixed will decline.
Here’s our opinion—not necessarily Mr. Fore’s. Big manufacturers will be in a pinch. They’ll likely try and “keep the good times rolling” by spitting out as many rigs as possible. To do it, they’ll continue to cut back on materials, skimp on attention to detail, and God help the buyer, forget anything about quality control. Concerned about these things? It’s probably best to steer AWAY from the big manufacturers, and point your buying eyes in the direction of smaller companies who don’t have to worry about cranking out loads of ill-built rigs. Their livelihoods depend on maintaining their reputation for quality.
##RVT1131
I went to one of the Tampa shows, and this article is spot on mostly. The price points for the JUNK aka (Rv’s) at the show like covid never happened. Trying to make a deal was like pulling teeth. Sale prices, what sale prices. The average 30 foot 5th wheel was 90,000, and then they discounted it by 30,000, which puts it at 60,000. In reality, the last number is where it should start. These companies act like they are doing us a favor when they say that is the absolute rock bottom price for said product. Let me tell everyone what we saw. Trim falling of the ceiling,plumbing not connected, stoves were not set up. There were so many different issues, and it didn’t matter to the manufacturer.
Time for us to rethink. We have been looking at the InTech OVR.
The message delivered by this article is exactly why we bought an LTV (Leisure Travel Van). I toured the factory in Canada this past May and watched as a variety of LTV models were manufactured by hand by skilled craftsmen/women. They are expensive but they are top of the line in quality and they stand behind their product.
You are so lucky to be able to afford this…it’s beautiful!
We bought an LTV because of the quality and service that LTV provides. The company has low staff turnover because Triple E, the parent company of LTV, respects their workers and treats them well. And the low staff turnover means experienced workers are building your coach.
Very similar forces are working on the RV park model. Raise the content, raise the consumer costs. The resort model might be a failure.
You can have all the bells and whistles (bling’s), if not installed properly and troublesome out the lot isn’t worth spit. Oh, look at these (this) feature, well, it was working awhile ago, lol!
As Ben Franklin once said, “The bitterness of poor quality remains long after the sweetness of low price is forgotten.” I wonder if he ever owned an RV?
Let’s not forget all the people who had “extra” disposable income fron stimulus to mortgage forbearance to student loan forbearance. It gave a lot of people a sense of having more money.
Thank you, Russ and Tina! We financed our current RV ourselves. I wonder how much less we might have paid if I had followed your advice and acted, at least for a time, as though we would finance it through the dealer? Oh well, that is a long-gone opportunity. Meanwhile, we continue to travel and enjoy our RV. Safe travels and happy Thanksgiving, or, as we hillbillies in east Tennessee say, have a good Thanksgiving! 🙂
The illustration for this article reminded me of Saturday Night Live’s Mr. Bill; oh no, Mr. Bill! 😉
Hahaha!! Great reminder Neal! 😂
Clearly Lemonis (and other big dealer owners) looks at the current situation as short term issue. CW, Lazy Days, Blue Compass, and others continue to buy up smaller dealers throwing in the towel. When the market cycles back to better times these companies will be well positioned…and then God help the buyers. What a nightmare!
Reading this I’m reminded of what happened with the scuba diving industry several years ago. After being steady for many years suddenly it seemed everyone wanted to dive. Classes were shortened to get more people involved ( cheaper materials) and business was booming. Then it dropped off and everyone moved to the next fun thing with many dive shops closing.
“point your buying eyes in the direction of smaller companies who don’t have to worry about cranking out loads of ill-built rigs. Their livelihoods depend on maintaining their reputation for quality.”
So, who are these smaller companies?
Outdoors RV in La Grande,Oregon is one. They build quality units designed for cold weather,and hot. I have had numerous junk RV’s over the years even as recently as 2017 and will never buy another corporate cracker box.
Most of them are NOT in Indiana! Northwood (Arctic Fox, Nash, etc.), Adventurer, Oliver, Northern Lite, Scamp, Four Wheel Campers, and several others have always been considered quality companies. This may mean heavier (better materials) and more expensive (less production, higher wages) RVs, but you get what you pay for. These companies are located in Oregon, Washington, Tennessee, Canada, and other locations outside the NE Indiana “RV capital.” Outdoors RV, as mentioned below, and Lance were in that category, but have been bought by larger companies.
Don’t forget Casita in the DFW area!
Agreed…never buy anything with the word ‘Lite’ in the name…
Outdoors RV is owned by Northwood Investments – which owns Northwood Manufacturing (Artic Fox/Nash) as well as Outdoors RV.
What about InTech….just asking
Leisure Travel Vans if looking for a B+/small C motorhome. A Canadian company that builds a quality product. Pricey but not as much as other manufacturers. “You get what you pay for.”
Mr. Fore reminds me of Gregg Gerber who was associated with RV Daily report. As Editor of RV Daily report, Mr. Gerber wrote a multipart article on the “Death Spiral of the RV Industry.
As a reward for his insight and honesty, RV Daily was ostracized and boycotted by RV industry advertisers to the point that RV Daily Report went out of business in June of 2019.
Did the RV industry take anything of value from the “Death Spiral article”? It is my opinion that it did not but other opinions on this matter are out there too.
You can still find the RV Death Spiral article on the Web if interested. Also, I hope Mr. Fore is treated better than Gregg Gerber by the Industry they both worked for.
Thanks, Ken. Here’s a link to Greg Gerber’s “RV Industry Death Spiral” editorial, which we have linked in our newsletters before: https://www.rvtravel.com/wp-content/uploads/2019/06/RV-Industry-Death-Spiral-compilation.pdf As Publisher Chuck Woodbury has said many times: “We will continue to report the truth as we see it. We will never put advertisers ahead of you.” Which is why we sooo appreciate our voluntary contributors so that we may continue to put you first and can keep publishing no matter what pressure is applied from advertisers and the industry to try to muzzle us–as they did, very unfortunately, with Greg Gerber. Have a great day. 😀 –Diane at RVtravel.com
Old folks have seen this in the auto industry in the 1980s. American cars were built with obsolescence In mind. People were disgusted. It opened the door for Asian car companies to enter the American market with quality products. They took market share and are here to this day. Built-in obsolescence became a thing of the past. I keep hoping something similar will happen in the rv industry, forcing the American RV industry to build quality RVs again.
It’s interesting that American cars built in the 1970s-early 1980s are now considered to have been terrible quality compared to 1960s and 1990s. Interesting because an American car company, GM, produced one of the highest-quality RVs ever built in the mid-1970s: the streamlined, low-profile, front-wheel drive GMC motorhome! It’s amazing how many are still on the road and how fervent their owners are to this day.
If I ever upgrade my solid and reliable 2018 model rig…it will be for an immaculate 2019! No covid-era junk for me. And I’m tickled to see textbook “free market” dynamics at work here. I hope future buyers remember how poorly they were treated. But they won’t…never do. The cycle always repeats.
‘finance your rig for 15 or 20 years’ ! LOL That’s a home mortgage, not a loan on camper that you’ll tire of in a few years…sounds like predatory lending more than anything.
And ignorant buyers to feed them.
Perhaps as the number of dealerships declines, those remaining will start treating people like customers instead of bags of money that need to be squeezed dry by any means then discarded.
Regardless, it’s the buyer that loses. But I’ll give them the very indifference they give their customers when their poorly assembled products created hardship. My sympathies are on backorder, supplier shortage and all…..
Before I bought my current coach, 2012 Phaeton, I shopped for the financing myself. When I met with the “Finance Guy” at the dealership I told him what I could do on my own and said “match it” and I’ll place it with you. He offered me 1/2% (50 basis points) higher than what I brought him!! I suggested he was taking me for a fool. He took 30 minutes to come back with the deal I brought him from the same bank. I saved 50 basis points over 20 years. I continue to question the wisdom of the bank lending 80% of the value of a Tiffin DP to a 70 year old. Amazingly I am not upside down on the loan today, unless I try to sell it.
“I continue to question the wisdom of the bank lending 80% of the value of a Tiffin DP to a 70 year old.”
Um, I would just as logically question the wisdom of anyone of any age financing an RV for more than 50% of its fair market value (not retail price) for anything more than 5 years, maybe 10 for a new DP. RVs are both a depreciating asset and have high maintenance and other ownership costs as well.
“Amazingly I am not upside down on the loan today, unless I try to sell it.”
Um, that is the very definition of being upside down on a loan; when the lien balance is greater than the fair market value.
Thank you for this great article and report R&T. We went by the local Blue Compass RV show yesterday, just to kill some time, and saw first hand the rather stark interiors and low cost materials in most of the different units. Let the buyer beware!!
And what’s with the all white interiors ?
I do not care about the poor RV dealers and builders. It was their decision to be in business. I think now is a great time for folks who might have never owned an RV to buy. And for folks happy with their old rigs to wait before trading. Anyone new to the RV travel and/or RV camping and RV ownership needs help to understand how rigs are built and maintained. They are not like passenger cars and they are not like a house bolted to a concrete foundation. RV’s are their own can of worms. And mostly for folks, young or old, with disposable income or savings.
Russ and Tina, thanks for the insightful article. There’s one additional thing that would be really useful, identifying “the smaller companies who don’t have to worry about cranking out loads of ill-built rigs”. I think I know who the big guys are you’re referring to, but I’m not sure which ones are the small companies.
Good question, especially regarding driveable rigs. How many “smaller” companies are out there? Seems Forest River, Thor, and Winnebago have bought them all up.
The manufacturers who know how to set money aside for a rainy day would have seen further down the line and been prepared when the market became flooded and the pandemic would be over. Financial Peace University will teach anyone (manufacturers, dealers, and the common man) to put aside money first. “Steady plodding brings success. Get rich schemes will lead to poverty”. So, only buy when you have saved. And steer clear away from the shiesty sales/ finance dealers. The advice of the day is: learn discernment from an experienced “counselor” before buying.
I looked long and hard at small Class C’s, B+’s, and B’s two years ago. They were all overpriced and lacking in quality of build. I wound up buying a new extended van and spending 25K on parts and materials converting it myself. It took 5 months of time to do it. But no leaks, no electrical issues, no loose trim, no thin junky wall panels, etc. What the RV industry is selling may have some good component parts, but the lack of quality and craftmanship in putting the vehicles together makes for a poor finished product. They do look pretty on the lot, but they aren’t necessarily functional for real world use nor do they hold up well once subject to the rigors of driving them 1000’s of miles.
Very good article. The industry as pointed out is one reason I’ve gone ahead and spent around $12K in repairs etc. on my 2014 DP than move away from it into just another RV headache. At least I know what I have now.
Gerber wrote his piece nearly a decade ago now. It holds. Rv parks…basically front end saleman of RVIA, pushin’ everyone out that cant abide their 2,3,5,10 year rule.K. So lets examine this. You cant stay here unless you are in a new rv, that looks good, even though the entire rig is a teetering fire hazard, long as it looks good though right? and long as you are making payments..you are in the club. Bought your rig in cash? DIy yourself? Everything works as intended? no fire hazards? oh, you can still afford your rent and to eat? Sorry, we dont take those who have figured out how to rv without monthly payments. Rv websites gaslight the situation in a big way.keep people buying in. sad.