Wheeler: Airstream’s Ready to Return to Business as Usual – RVBusiness – Breaking RV Industry News
LAS VEGAS – After coming off the “sugar high” of the pandemic-induced RV surge, Airstream Inc. executives said they are not only ready to return to normal business operations, but strategic decisions have the Jackson Center, Ohio-based manufacturer poised for “good things to come.”
That was the message Tuesday from President Bob Wheeler, among others, to kick off the 2024 Airstream Dealer Meeting, which runs through Thursday, July 25, at Caesars Palace in Las Vegas.
“Even though we’ve come off the peak of pandemic demand, we are still in a very good position as a company,” Wheeler told RVBusiness. “We’re running very efficiently; we’re still highly profitable. We’ve got organic growth plans over the next three to five years, with new products coming online. We’ve got a new marketing push, promotional efforts for spending a lot of money to help drive leads to our dealerships.
“Really, we’re back to doing what we know how to do and it feels good to get back to business as usual – although I’d take another surge in demand like we saw in the pandemic share – but really we know how to operate in this market and we’re looking forward to really digging in,” he said.
In addition to Wheeler, presenters included Vice President of Sales Bryan Melton and Chief Marketing Officer Mollie Hansen, as well as THOR Industries President & CEO Bob Martin, Patrick Calpin, director of partnerships for the RV Dealers Association (RVDA), and Bill Baker, vice president of membership and research for the RV Industry Association (RVIA).
Melton provided an overview of the 2025 model year changes, which will be released publicly beginning Aug. 2, as well as several company updates including changes to its Airstream Exclusive store model, restructuring of key leadership positions, and the strategic acquisition of Creative Mobile Interiors, a Columbus, Ohio-based customizer that will help the OEM produce limited edition runs on products in partnership with national brands.
For her part, Hansen offered several updates on her team’s marketing efforts, which she said has fully shifted from focusing on retaining Airstream owners during the pandemic to now where they are back to attracting new owners to the iconic brand. Among other highlights of her presentation was the fact that an Airstream unit happened to be featured by other companies in three Super Bowl commercials – without Airstream having to spend a dime. The cost for just one of those commercials would have probably blown her entire annual budget, Hansen noted.
During their time on stage, Martin mentioned that Airstream was the very first OEM acquired by THOR Industries, Calpin offered an overview of RVDA’s key initiatives that included a plea for dealers to lobby their federal legislators to pass the Travel Trailer & Camper Tax Parity Act, and Baker touched on RVIA’s focal points, which included lobbying Congress to close the de minimis loophole negatively affecting the industry’s aftermarket suppliers.
Following his presentation, Wheeler sat with RVBusiness to address some of the points he made. What follows is an edited account of that conversation.
RVBusiness: There’s so many different directions we could go with this, but it sure seemed like your overriding message is Airstream is back to business as usual.
Wheeler: We enjoyed an enormous surge in business during the pandemic, as did everyone in the industry. And, since then, we’ve come back to earth. We actually milked our backlog for about a year longer than the rest of the industry. So, we had a pretty soft landing, but now we’re back to much more tied to retail, sell-through rates. Our dealer inventories are nearly full.
So yeah, in a very real way, we’re back to business as usual.
The hard part is reminding people that we’re not in some sort of recessionary stance. We’ve just gone backward from the peak that we knew was not real. I call it a sugar high. That pandemic demand wasn’t going to last, and now we’re back to doing what we know how to do best: growing business organically, attracting new customers, generating leads for our dealers, getting PR and press where we can, innovating new products, reaching new audiences, talking with other brands about collaborations and help expanding our reach.
So, this is business as usual, and in some ways it feels good.
RVBusiness: You also mentioned that you’re starting to see your field inventory at levels where you’d want them to be.
Wheeler: Yeah, we went from extremely behind inventory levels, where our dealers were desiring, to being at a point where we’re really caught back up. Now, dealer inventories are practically full, a little more for one product line, a little less for the other, and really are pretty well balanced. But we’re still below what our dealers would say is their optimal inventory level, which is really where we like to run around that 90% of optimal.
We run on a scarcity model. We know that if we oversupply the market with Airstreams, that will drive down the price and the value in a way that would do harm to our dealers and the company and the brand. So, we’ve always run just a little behind market demand. During the pandemic, it was way behind, but now we’re back to being a little behind. We control our output very carefully to maintain that brand equity and that demand rather than a push. We’re a retail pull, not a wholesale push company.
RVBusiness: Earlier this year Airstream made the difficult decision to reduce its workforce due to lowered production rates the sluggish market. Have production levels returned to somewhat normal – at least as far as what the current market conditions will allow?
Wheeler: So, back in January, we had to have a fairly sizable layoff to reduce our motorhome output to match market demand. And shortly after that we were struck by the side effects of a local tornado on March 14th with significant hail damage.
We have not been able to call all those people back because we had to shut down two production lines that just reopened at the end of June. Some of those folks have been called back into our travel trailer plant to help backfill attrition.
But we look forward to the time this fall when we get the Rangeline, our Dodge-based product line, back up and running and we’ll be able to recall the rest of those folks. That’s the plan.
RVBusiness: You mentioned from the stage that the last six months have been the most difficult of your career.
Wheeler: Yeah, it has been a hard six months with a fairly sizable disruption to our management team with the untimely departure of our VP of sales, now very capably backfilled by Bryan Melton.
Then the storm hit on the 14th, and it was nothing like we’d ever seen with widespread disruption locally, three fatalities, and six of our Airstream associates displaced from their homes. And most impactfully we had every unused or every raw chassis on site was damaged beyond use. We had almost 1,100 Mercedes-Benz and Dodges that looked like they’d been beat with a baseball bat. So, we quickly scrambled to get chassis reordered, and that limited our downtime on our interstate line Mercedes line for three months, but it’s going to be more like five for our range line.
And then finally, there was a very unfortunate and sad fatality with one of our customers riding in a travel trailer. It was not our fault nor was it anything we could impact or effect, but it was still very sad. And the press picked it up in a big way and it was nip and tuck there for a while. That was just another distraction from trying to get back to building and selling RVs.
RVBusiness: So, it’s safe to assume you’re looking forward to being back to building RVs?
Wheeler: Yes, we are. We restarted our Interstate line at the end of June, as I said, so we brought some more folks back who were reassigned to different jobs in late August, early September. We should get our Dodge production line back up and running when we get those replacement chassis. And we’d just love to put this whole spring 2024 season in the rear view mirror.
