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Why RV Sales Are Surging
Americans are finding new ways to travel amid lockdowns and social distancing requirements. The need to travel while safely social distancing has drastically increased sales for RVs. A recreational vehicle, RV, is considered a motor vehicle that includes accommodating living quarters. The living quarters allow people to live within the motor vehicle for short or extended periods of time. Currently, between 1-1.5 million people reside full-time in their RVs. Many types of motor vehicles classify as RVs. In 2018, RV sales were on the decline. The recent increase in RV sales has been attributed to the coronavirus pandemic. Traveling by RV allows families to safely leave their home while avoiding personal contact with others. RV dealerships are noting that families whom have never considered purchasing an RV, are now considering it. Additionally, as the number of people working remotely increases, consumers are deciding to capitalize on their locational flexibility.
The largest manufacturer of RVs is Thor industries, Inc. Founded in 1980, their slogan is “Go anywhere. Stay anywhere”. The slogan speaks to the consumer interested in the mobile, RV lifestyle. The RV industry is connecting well with the younger generation. Customers who own a RV range from retirees to millennials. In 2015, the average age of a RV owner was 48. In 2017, the average age of a RV owner was 45. RV manufacturers are hopeful that the attraction of the younger generation will be ensure the longevity of the industry.
The RV industry is a $20B industry and the soar in sales has also increased quality control issues. Several RV dealerships and customers are reporting a reduction in quality. As RV manufacturers rush to fulfill production orders, this urgency has resulted in increased error margins. RV manufacturers are also in intense price competition to attract this influx of new customers. Customers who are looking to purchase an RV are encouraged to do intense research before making the purchase. Parking is another issue the RV industry is facing. CNBC reports that a RV park can cost $20,000 -$25,000 per parking space to build. Thus, it may take a very long time for investors to make a return on investment. Even as the RV industry maps out the growing pains, experts believe the increase in sales can lay a foundation for additional months and years of growth.
Questions:
- The coronavirus has impacted the travel industry in several different capacities. Compare and contrast the impact of COVID-19 on the following travel industries: trains, RVS, airplanes, and cruise lines. Discuss which industries are expanding, contracting, and why.
- The RV industry has seen a reduction in quality. Explain how a lack of quality control may eventually adversely affect demand for RVs.
VIDEO URL: https://www.youtube.com/watch?v=Wx3eElgY9aE YouTube Channel: CNBC
Supporting Article & Author: https://www.foxbusiness.com/lifestyle/rv-sales-surge-during-coronavirus-lockdown-orders Daniella Genovese
