RV over production?

[mustangcats]

I drove past the Camping World in Cedar Falls/Waterloo, IA today and their lot looked the same as it has all year...bursting at the seams with RV's of all shapes and sizes. I'm sure it's the same at any other RV dealership. Summer is about over, so I can't believe there are that many selling opportunities left this year. What becomes of all the left over RV's? I can't believe they would be able to sell enough of them to make room for the new models. Maybe they move them around to other dealerships...but I'm sure their lots are overflowing as well.

[lrrowe]

I see the same here in the East driving I81 from VA to PA.

[DrewsBrews]

A bubble on the verge of bursting?

[tony.latham]

I've seen this for the last several years. I don't care what RV lot it is, Missoula or Boise, the inventories are huge. I wonder if the inventory doesn't cost the dealer a thing until they sell one?

Tony

[lrrowe]

I've seen this for the last several years. I don't care what RV lot it is, Missoula or Boise, the inventories are huge. I wonder if the inventory doesn't cost the dealer a thing until they sell one?

Tony

But somebody is footing the bill. Has to be a huge drain on cash flow.
Thus maybe another reason to build them cheap. Who can afford more inventory cost?

[troubleScottie]

I cannot recall any time driving by the large RV dealers in WA and not seeing lots of vehicles on the lot.

It is hard to determine what is new and what is old. Or what has been sitting there.

In addition, although there is a "year" for the RV but they generally do not have major release dates. Nor do they have significant changes that are easy to identify. I would bet you have a hard time identifying what year a particular vehicle is. Over time, you do see design changes eg more toy haulers are available and slide outs are now available on the lower priced RVs or the style of the interior changes eg more stone like counters or bigger bathrooms.

The whole concept is a bit weird. If you are paying $300,000 for a vehicle, I would expect I would pick each and every color and feature and expect a custom build for me.

Maybe if you getting a popup or a low end vehicle under $30,000, maybe there is really no options and like a car, whatever is on the lot is OK. Even then, it is pushing it.

Granted if you are getting a used one, you are getting whatever is there.


Then again, most auto dealership appears to always have cars. The only expectation is recall was back in the 80's when Honda would often sell out to the point the only cars on the lot were vehicles the owners did not pick up.

[GPW]

They probably have a “Floorplan “ system , where the manufacturer supplies them with a certain number of vehicles on consignment ... Much like the music Instrument business...
We bought our little RV trailer on sale as the previous years model ... Turns out , the new models looked the same but had changed from things that didn’t work in the previous years model ... like “Dry fit windows “ ... that all leaked (mine too) ..

[S. Heisley]

Some people like to buy right off the lot so that they don't have to wait. The dealers may be cashing in on being able to dazzle the lookers, causing them emotional purchases. That's my guess.

[Cosmo]

Maybe demographics?
10,000 baby boomers retire each day and this is the start of the boomer retirement cycle.

From the article below
“Baby boomers are the ones who can afford these things and who have the flexibility to get up and go”

http://www.startribune.com/luxury-lovin ... 318910171/


-Cosmo

[daveesl77]

My wife and I have seen this for years during our trips around the US. Every big dealer is packed, even small dealers. It just does not make economic sense. Granted they are designed and built on planned obsolescence but really? Then again, my neighbor, over the course of 6 years bought 4 new, big motor homes. Not sure why, he just did. He then saw our little camper and sold his last RV. He has now been looking at old Scotties and the like.

Somebody is paying the freight on all those units and just sitting still isn't good for them either. Hmmm. Maybe it is a Martian plot to take over the world, one crappy RV at a time.


dave

[razorback]

I remember reading in the mid 70's a report from Kiplinger's magazine that the best all time indicator of when markets would crash would be the RV industry. Primarily the large price class A's. The article says these items are the best indicators because they are truly an expense that people who operate businesses or people with money can live without. I have always remembered that article and found it to be very true. Twelve to eighteen months before markets, across the board, begin a rapid decline; the RV industry will already have taken a huge hit. Larry

[noseoil]

I think it has to do with the retirement thing & production. If 10,000 people retire each day & 5% of them buy an RV, that's 500 a day. Multiply by 365 & you have 182,500 units each year. I'd like to see the stats on actual sales as a percentage of inventory, just to see where things stand at this point.

Interesting fact about recessions & the RV manufacturing business. Wonder where we are now in that overall economic process?

Here's an article I found about the numbers in general & what they indicate nationally. Go figure on this one?
http://www.rvia.org/?ESID=preleases&PRID=1767&SR=1

[GPW]

Oh , and don’t worry now , the Feds will be buying up excess trailers for FEMA - LA flood victims ... So another federal bailout for the dying RV industry ... And FEMA considers them “disposable “ which fits right in with othe attitudes of the RV manufacturers ...

[3GKnight]

"If you build it, they will come..."

I see part of it as a symptom of how publicly traded companies are run. Same for the auto industry or pretty much anything you buy at Wally World. Performance is measured quarterly so all financial decisions are based on that quarter and not necessarily long term. Business analysts can get pretty optimistic too. I don't know how these guys forecast demand, but if they don't make a product to sell, obviously they won't sell it and make any money.

In other words, mass manufacturing is not necessarily driven by demand but rather the expectations of 'performing' on a quarterly basis. They're willing to take an uncertain loss next quarter for a certain gain this quarter.

God bless America!