RV Industry Sees Lower Shipments As ‘Normalization’

As the recreational vehicle industry approaches the end of 2022, the nation’s economic malaise and spiking interest rates have caused buyers to tap the brakes on purchasing an RV. The latest data from the RV Industry Association shows year-to-date shipments are down 8.2% compared to the first nine months of 2021. The month of September was especially challenging, as overall wholesale shipments to dealers were down 48.5% compared to September 2021.

But in an interview with Inside INdiana Business, RV Industry Association spokesperson Monika Geraci called the decline a “normalization” of the industry following record shipments last year.

“Last year was a record setting year, over 600,000 RVs were built in 2021. That was a nearly 20% increase over any previous year,” said Geraci. “Our latest forecast shows that we’re going to be just shy of 500,000, which will be the third best year on record, right there close to 2017.”

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In September, Elkhart-based THOR Industries reported a full-year net income of $1 billion, a record for the company. THOR President and CEO Bob Martin acknowledged a “softening in the towable RV sector” during the fourth quarter, but still record Q4 net income of $281 million, compared to $230 million during the same a year ago.

RV Industry Association data shows during the first five months of this year, monthly shipments surpassed last year’s record-breaking year. But at the mid-point of 2022, as inflation and interest rates surged higher, demand lessened, and so too shipments from manufacturers to dealers.

“The macroeconomic issues are not great, particularly inflation,” said Geraci. “But what we know is that RV travel is a more economical way to travel.”

Looking to the year ahead, the RV Industry Association is expecting a further drop in wholesale shipments. A quarterly industry forecast, conducted by ITR Economics, puts the estimate at 419,000 units in 2023.

If realized, that would be a 16% decline from the projected 2022 total.

“We’re expecting to see these monthly shipments be a little bit lower, like we’ve seen on the back half of this year. And then we expect it to pick back up,” Geraci said.

The RV Industry Association says Indiana factories account for 86% of U.S. RV units. Second place belongs to Oregon with just 3% of RV production.

View the full story from Inside INdiana Business here.