Video: NIRVC’s Davis on Inflation, RVs, Motorized Decline – RVBusiness – Breaking RV Industry News
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From National Indoor RV Centers (NIRVC): (Part 1 of the 3-Part Series) In our latest video series, “Brett Talk,” NIRVC President and CEO Brett Davis shares insights on the RV industry. First topic: inflation! And its disproportionate effect on the motorized RV industry.
It’s crystal clear that the RV lifestyle is very popular here in the United States. Since 1980, the RV industry has grown 450% times faster than the population. Considering that new industries and disrupters are created every day, it’s quite impressive that a 65 year old industry is still growing 4.5 times faster than the population.
Now, when we isolate towables as their own segment of the industry – manufacturers shipped 78,468 towable units in 1980 – growing to a peak of 554,058 by 2021. This is a compounded annual growth rate of almost 500% faster than the population!
On the contrary – motorized RV production reached its all-time high way back in 1984! That year, manufacturers shipped 81,992 new motorhomes. (This number comprises all Classes: A, B and C.) By 2022, motorhome shipments had fallen to just 58,410 units, which is its current cyclical peak. In Wall Street lingo, motorhomes have had six “dead cat bounces” since its all-time high in 1984: meaning, with each business cycle, there have been lower highs AND lower lows.
From 1984 through 2021 (the year the RV Industry as a whole reached its all-time high), motorhome production and shipments experienced a compounded annual negative growth rate of -0.92%.
Think about that for a minute. The population grew at a positive 0.97% per annum, while the motorized RV industry shrunk almost just as fast, at a negative -0.92%. But, now to add insult to injury, motorhome production lost serious market share as well, falling from 38.01% of all RVs manufactured in 1984 to just 9.36% by 2021. A stunning 75.4% decline in market share!
Why is it the exact opposite ratio in Europe? Why do 90% of Europeans own a motorhome and only 10% own a towable? Historically, on average, over this same period of time, gas was 43% cheaper here in America than it was in the UK, and diesel was 54% cheaper.
On a relative basis, motorhomes also have become more affordable since 1984, despite their decline in sales and market share. The fact motorhomes are more affordable today than they were at their peak in 1984 doesn’t explain their 38-year decline in sales and market share.
Be sure to watch the entire video as Brett takes a look at the past 43.5 years of RV shipments, identifying through actual sales data how easily once can see when overbuilding (excess supply) or under-building (excess demand) is occurring.
Source: https://rvbusiness.com/video-nirvcs-davis-on-inflation-rvs-motorized-decline/
