There is more evidence of late that the shortage of new RVs is beginning to shift. That’s good news for consumers ready to buy but could spell trouble for RV dealers and manufacturers.
The Wall Street Journal recently published a story that said the meteoric rise in stock prices may be a memory for Thor Industries as well as Camping World Holdings. After Thor stock doubled in value and Camping World stock tripled in value in 2020 and 2021, shares in both companies have dropped an average of 30% in 2022.
Experts point to a plethora of reasons for the declines, including general economic malaise, rising interest rates, climbing fuel prices, and the recovery of the supply chains. Less attractive financing suddenly makes cruise vacations and trips to European destinations look like a bargain.
RV dealers, who suffered from low-to-no inventory for much of the early pandemic, now find themselves with overflowing lots at a very inconvenient time. A recent survey by the firm Truist found that nearly 70% of RV dealers claimed demand for new rigs has slowed “noticeably.” About 40% of the dealers surveyed said they expected sales volumes to decline, compared to 5% when they were surveyed in February.
The Wall Street Journal story quoted Raymond James analyst Joseph Altobello saying the RV industry would be “hard-pressed to complete a soft-landing.” Altobello went so far as to say that the oversupply on dealer lots will likely bring a high degree of discounting.
The Truist survey also said more than a quarter of RV dealers said they were “too heavy” on inventory at their stores—the highest reading in four years.
Dealers go negative on the future
When we take a closer look at the June RV Dealer Sentiment Index prepared by Baird Financial Services and published by the RV Dealers Association, we find that RV dealers now appear to be negative when they forecast for the next 3-5 years.
The index looks at dealer sentiment based on a score of 1-100. Scores over 50 indicate a positive outlook, while scores under 50 indicate a negative outlook toward the future.
The overall RV dealer sentiment score in June was 26 out of 100, down 54% from the score in April when dealers rated the current industry market condition at 57. The June score is the lowest level since 2009.
When dealers looked out 3 to 5 years, the score rose to 47. That was up 8 points from the 39 score in April, but still showed a negative outlook. It’s only the second time the 3- to 5-year outlook has been negative since the index began in 2006.
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Average rig value dropping
Analytics firm J.D. Power is reporting that the average retail value across all RV classes dropped through April and continued to decline through June. But don’t feel too sorry for big manufacturers or big dealerships. Thor Industries, by its own worst-case scenario, still would generate $365 million in net income even if sales decrease by 35%. Camping World appears to be doing well in secondhand RV sales and has done a pretty good job of managing overhead. The company also continues to branch out into almost every aspect of RVing, including service, financing, insurance, and now a peer-to-peer rental business it owns called Rvrentals.com.
Events for the rest of this summer will likely define the future for RV builders, sellers, and buyers. It could be a bumpy ride.
Good to hear. Anything that makes RV dealers and manufacturers work harder to acquire customers is a good thing in my book.
The last recession caused a lot of RV technicians to leave the industry. Hope that doesn’t happen again. IMO, getting RVs repaired has been a disaster.
With the down turn in the pandemic most of the people who never considered RVs for vacations will go back to their usual style of vacationing. Most of those people want to be pampered and waited on hand and foot. Being an RVer requires a lot of work that they’re not use to nor willing to learn. Thinking about it will mean less campground crowding, less traffic, less of everything that has been bad the last few years. Whippee! Of course airline fees will climb, but I don’t fly so that will have no effect on me. Lol
“What goes around comes around”. The only question is where will RV quality go? My guess is even faster and deeper in the toilet
I like to think that if they truly want to stay in business they’ll make the required changes to build good solid quality rigs.
I told the service manager and the RV store manager several years ago when they screwed me around on warranty work. “ Some day you will not be selling RV’s like hot cakes and you will be begging people to bring them to you for service so you will have a job but people will remember and go elsewhere sending you to the bread lines”! When I need service I drive right by them to the independent repair shop down the road.
Good point. Let’s be sure to recommend any good repair shops we know, especially to newbies who could get ‘the business’ from the dealers.
If anyone ever gets in SE Minnesota there is an excellent RV repair shop in Oronoco,MN right along Hwy 52 N. Expert RV Sales and Service
“Experts point to a plethora of reasons for the declines, including general economic malaise, rising interest rates, climbing fuel prices, and the recovery of the supply chains. Less attractive financing”,,,,. Not a word about quality or price of RVs, the two elephants in the room. Note how these reasons all point to conditions outside of the control of the industry itself. These “experts” must reside on the boards of the major manufacturers. At least the article acknowledges the oversupply.
GREAT POINTS! RIGHT ON!
I agree.
I bought my 2020 Coachman Leprechaun 33ft May 2020 to continue my optical business. I was shut out from Feb 2020-June 2020 due to Covid. I knew nothing about RV(s) so, I bought the bumper to bumper warranty just in case. I am grateful for my mobile optical and having it quadrupled our business. Have taken it 3 times for family vacations, enjoyed that very much. I love driving it! I love cooking in it! Just so thankful to have it, and was able to pay it off in just 13 months.
Addressing the Bumper to Bumper warranties, there not any count.
I have a new 2021 Jayco , tried to get the warranty to fix the problems.
I ended up fixing them myself.
Very poor Quality Control system within the Jayco line.
In the big picture, the RV industry enjoyed a ‘flash in the pan’ of increased sales. Sadly they also orchestrated long term damage to themselves. Once they realized what the pandemic handed them, they greedily pumped out low quality, unfinished, over financed RVs of all kinds. So many people were driven to purchase only to now be massively disenchanted, financially stung and more than remorseful buyers. The result? The industry has successfully chased away its repeat buyers and damaged the narrative towards future owners/buyers. There are a lot of people who will never buy again and who will undoubtedly speak very poorly of the RV experience.
I’m sure the RV industries ‘crystal ball’ will tell them they have acquired so many new consumers into the RV lifestyle and their continued business will feed on. Reality is, look at the storage lots! There full of RVs.
Which way will the RV industry go? There’s only one direction, and that is down. In addition to the general economic malaise, rising interest rates, high fuel prices, let’s not forget the aging out of the baby boomers who will be leaving the RV community and putting their rigs up for sale, as well as those who bought RVs during the pandemic and have decided that RVing is not for them and put their rigs up for sale, and the bank foreclosures on those who bought RVs with 20 year loans and can’t sell them without a significant loss and decide to let the lender take it and try to resell it. All of these used RVs on the pre-owned market will depress new RV prices. Finally, there are the problems getting a spot in an RV campground or state/national park, which has been well documented in this newsletter, which will also cause some RVers to give up RVing. Bad times ahead for the RV industry…in general it would appear.
My wife just found a 2023 jayco travel trailer which is 29 feet. Has a triple slide for $53,000.00 dollars.
Wait a few months and get it for its 2019 selling price of half that!
Hi Jeff. I got a 2022 jayco 32 ft you can get for payoff. king bed, 2 fire places. Beautiful. You’ll save thousands.
Please send me pics
The thing that worries me most in an RV industry downturn is the consolidation that has happened over the last two years in campground and RV dealer ownership.
Mom & Pop campgrounds and RV dealers would struggle and live through hard times because their business is/was their life, similar to family farmers. Do you suppose the greedy wall street speculators that rushed in to buy up these businesses to make a quick buck feel the same way? Nope! They’ll do what they always do by closing the less profitable facilities. And there goes “local” campgrounds and dealerships.
Private Equity greed is taking over our campgrounds. $$$$is all that matters in corporate offices.
Boondock
Hopefully there will be no shortage of parts soon and it will not take 2 to 3 months to get an appointment to have something fixed that should of never have left the factory with the problems in the first place.
That is a bright side to look at!
Ever think that the shortage of parts may be to get people to buy new? Could be at least in part. Happy Trails
Except for parts coming through the California ports. California is shutting down about 70,000 independent truckers this coming week.
Longshoreman UNION at work.
Contract time. Any guess why we have had “supply chain” problems?
Good paying UNION JOBS!!!!
There’s only one party responsible for destroying unions.
As long as they don’t go out of business then everyone is basically screwed.
The sad part of this is the sales people will get the shaft on this situation, lower commisions, fewer customers…then probably forced to find work elsewhere. Used car lots maybe? But too bad, so sad for the manufacturers and mega dealers! They have certainly made some enemies in the last few years.
Well maybe the sales people can read up on what they sell and actually contribute to a better industry instead of lying about everything and literally knowing nothing about what they’re selling. Most should be selling used cars or vacuums.
Most RVs are junk unless you get into a truly luxury price point. My friend just upgraded to new I think he said 45′ 5th wheel while in Florida for the winter. On his trip up to Michigan, the wall panels literally collapsed/fell off the walls.
What BS. Our 07 Fleetwood Class A is great. Friends with new Airstream no issues. Tiffin, Newmar, Boulder. All good.
What? Your criteria is, if your 15-year old rig is fine, other people are lying about bad quality in new rigs? Get a grip. Glad you got a good model, and hope it stays that way, but there are lots of problems out there, even in the high-priced spreads. Let’s face reality.
I agree. They suck. Our older renovated keystone travel trailer is far superior than any of the crap we have seen even trying to find a better new one.
I could imagine in the cold and powerful windy conditions
Poor quality construction sure hasn’t helped
Regardless, $5 and $6 fuel costs are destroying RV and MARINE INDUSTRIES.
We’ve considered new rigs in the last year and didn’t really care about the price of gas, which we assume will eventually go down. The issue we had was our older model is MUCH better in numerous design features, which most RV manufacturers have cheapened to the point that most features on even expensive rigs are far worse, example two burner stove, no oven, no or fewer windows, smaller and lower quality doors, smaller awnings, smaller single sink (versus double), small ridiculous refrigerators, cheap tires, plastic versus metal everywhere, poor workmanship, cheap crap beds, ditto with window coverings, prices absurd. Meanwhile, our renovated slightly older travel trailer looks pretty cool and is much better in every respect. Maybe make something people want to use and buy?
I have a 23 yr. old Winnebago Adventure that is in better shape then a lot of the new ones out there.
I have only seen an increase in sale prices on motorhomes
RV trailers too. The RV trailer I bought new in ‘18 for $35k is now $50k.
It’s no wonder, with the poor construction of RV’s and the plethora of amateur RV’ers filling America’s roads….the vast amount of used RV’s on the market in 2023 will be a HUGE problem for dealers
Please –
This is 100% the issue of oil and gas. Who will spend $300,000 and then $5 or $6 gallon and 7 to 9 MPG.
USA OIL AND GAS SHUT DOWN. RV AND MARINE INDUSTRIES ALL BEING DESTROYED.
Its been a lifelong dream to live in different parts of this country out of an RV and pickup, off grid too if needed. About 2015 I started getting serious and looking at the products. About 2017-2018 I was really really getting ready to look and buy something within the next year or two but before I could get to that process the pandemic hit and the RV industry went nuts. And as I am not on any certain time table, I decided to wait more and see what happened to the industry after the pandemic. I will probably start looking again in the next 15 to 30 months for a RV and truck. I just recently turned 65 and I’m single so I believe patience is the key now if you’re looking to buy an RV.
Good first step for those of us waiting to start our adventure. Now we just need the quality to get better and to be able to buy a truck without paying thousands over list price.
Best day ever is when your purchase your new rv ,boat or travel trailer, then Best day EVER is when you sell it at a loss
The quality of new RV has dropped a lot.The large manufactures buying up other manufactures hasn’t helped.
Yep, I’m no fan of Thor gobbling up good/improving RV companies like Jayco & Entegra & then see their quality drop like a stone.
I find our local dealers have a whole bunch of the cheap stick and tin RVs on their lots.
RVs that were listing at $20k in 2018 are now listing at $45k. Of course they can take a 35% drop in sales and still make money. Prices are crazy for what you get.
Plus, they’re still building with scrap wood and staples.
It’s all due to the high fuel costs.
It costs more to transport these things, plus people just don’t have the money for luxury toys.
Have to put food on the table first.
Add to all this the lack of available camping sites makes me wonder how many may reduce trips or bail out and hang up keys. Another thought, reflecting on an article I read here, I am curious if the number of CGs moving away from overnighter / short stay campers and going to seasonals will effect availability further. We are interested in this as retirement is near at hand and our 40+ year desire to full time RV seems to be getting pretty complicated.
My guess is you will see a lot of listings for “just take over payments “ in the next few years.
After reading all the comments here is my two bits worth of wisdom. First, do the leg work and purchase an RV of quality and type that you can afford to maintain. Second, Recognize that there is maintenance involved. Our Tiffin Phaeton maintenance is well over $2K a year. This year it was over 7K with the installation of retrobands and a fire suppression system. Next year tires. They ain’t cheap… Airplanes, boats, and RV’s. Third, and most importantly, ask yourself how you will be using the RV. Sometimes I think that people who complain about quality of their rigs do not realize what they have requires care and knowledge. Fourth, and just tossing this in for a heads up is insurance. Add this to maintenace costs makes RVing a pricey way to vacation. Don’t get into it unless you can afford it. And, yes, I am not happy with diesel prices, dealer shop rates, RV ‘Resort’ costs, etc. This will change, hopefully for the better.
You all are far more savvy than I on RVs, but I am looking for one that will remain stationary at a plot of land. Any guidance would be appreciated in terms of what to look for as I’ve seen many of you comment on poor quality. Particular brands you would consider higher quality? I also saw someone note $2k a year in maintenance. I would expect this to be lower given ours will be stationary? Thanks in advance!