RV Shipments to Continue to Decline
In an updated outlook due for release this week during RVIA Committee Week in Washington, D.C., economist Richard Curtin, director of Consumer Surveys at the University of Michigan, is projecting RV shipments of 303,700 units for 2008, a 14.1% dip from 353,499 in 2007.
That’s a slightly harsher view of the year than the 13.8% decline Curtin predicted in March. And he’s anticipating a similar 303,100 wholesale shipments in 2009.
“I expect the low point (of the current decline) to be reached in the first quarter of 2009,” Curtin told RV BUSINESS.com. ” But the recovery will be so slow we will not fully recover to the level of 2008 (in 2009). That means another difficult year.”
Three major issues – formaldehyde levels in RVs, a distressed economy and the future of the Go RVing Coalition’s Committee on Excellence (COE) – are likely to dominate informal discussions duing Committee Week today (June 9) through Thursday at the Willard InterContinental Hotel.
As many as 250 Recreation Vehicle Industry Association (RVIA) members are expected to attend the annual gathering two blocks from the White House where RVIA standing committees and the Go RVing Coalition will meet to make recommendations on the association’s priorities for the next year. Their recommendations will be considered during a Thursday RVIA board meeting.
Although down considerably from a peak of 390,000 wholesale shipments in 2006, both 2008 and 2009 – viewed from a historical perspective – are still credible performances, considering they’re 30% higher than average shipments recorded in the 1990s, maintained Curtin, whose quarterly Roadsigns forecasts are published by RVIA.
“Part of the difficulty is comparing current numbers to the very, very strong numbers we’ve had over the past five to six years,” observes Mac Bryan, RVIA vice president of administration.
Perhaps most significant is Curtin’s projections for a slow rebound. Curtin sees tight credit markets, higher food and fuel prices, slow job growth and smaller wage gains all combining to create a drag on the recovery. “We have the credit markets undergoing a change that will make credit somewhat more expensive,” he said, citing examples like higher required down payments and better credit score standards.
“That will not disappear by the end of 2009,” Curtin added. “Higher food and fuel prices mean consumers will have to re-allocate budgets. And I expect the economy to produce fewer jobs and smaller wage gains, constraining wealth growth. You also have falling home values. Add in rising oil prices, which have caused some uncertainty, and all this has a dampening effect.”