RVDA of Canada Releases 2022 Annual Economic Review

RICHMOND, B.C. – RVDA of Canada’s 2022 Annual Economic Review, intended to deliver a comprehensive look at the economic indicators affecting Canada’s RV industry, indicates that fourth quarter sales for all RV types were down 20.9%.

“Unchanged from last quarter,” the review states, “the total RV sales saw declines in year-over-year sales, with a 17.8% decrease from 53,183 in 2021 to 43,711 in 2022. All product types have seen declines in 2022 with the exception of Class C motorhomes and park models.”

By the same token, tourism spending is on the rise, reports RVDA of Canada President Eleonore Hamm reports:. “We have yet to reattain pre-pandemic spend levels,” she stated in a release. “With forecasts for greater travel from U.S. and international visitors in 2023, we are well positioned for continued tourism recovery due to pent-up demand, which bodes well for our industry.”

Despite unit sales declining, the review notes, 2022 saw an annual gain of 11.1% in sales revenue, nearing $4.3 billion due to “healthy sales growth” in both second and third quarters.

Interest Rate Increases Bite, Leading To Deeper Recession: “With interest rates increasing, inflation slowing and the Canadian economy entering a recession, in addition to the US and Europe, we saw a negative turn in economic sentiment in the last quarter of 2022,” the review points out.

“The Bank of Canada is expected to begin reversing its policy stance by the end of 2023. Monetary easing is expected to continue throughout 2024 as the Bank of Canada slowly brings interest rates back down. With the economy shrinking, inflation is expected to decelerate sharply in 2023 after slowing steadily since hitting 8.1% in June of 2022.”

Labour Market Remains Tight Therefore Mitigating Recession-Related Job Losses: “Traditionally, recessions are associated with job losses and cautious business decisions when it comes to expansion and payroll; however, this is not currently the case which is partially due to the scarcity of labour.

“Given the limited availability of labor, employers are expected to be reluctant to let go their employees as it might be difficult to find people to fill those vacant positions and even more so once the economy begins to recover through 2024.”

Sales Expected To Grow But Expanding Number Of Firms Are Bearish: “For the fourth consecutive quarter, businesses anticipate their sales growth will slow. For more than one-third of all firms, this is after significant sales increases over the past year. Close to 3-in-10 businesses — considerably more than usual — expect their sales to decrease, with most attributing the decline to weaker domestic demand.

“Still, overall, firms anticipate that their sales will continue to grow. Businesses tied to commodities expect robust demand, which some linked to elevated commodity prices. A few exporters reported that the weaker Canada–US exchange rate has a favorable effect on their sales outlook.”

Source: https://rvbusiness.com/rvda-of-canada-releases-2022-annual-economic-review/