South Bend Tribune
ELKHART – Even with a nearly two-month shutdown earlier this year, the RV industry is operating at full capacity and hoping to reach shipment totals of 424,000 units by the end of the year.
The turnaround is remarkable considering the industry was coming out of a somewhat sluggish 2019 that had many observers wondering whether a recession was on the horizon. According to the latest market analysis performed by ITR Economics, the industry is expecting this year’s shipments to surpass 2019 totals by 4.5%.
And even with the sizable rebound in 2020 – the fourth best annual total on record – ITR is predicting record-breaking shipments of 507,200 units in 2021.
In a fourth-quarter financial report released recently, Elkhart-based Thor Industries said its sales and profits showed steady improvements as it emerged from the shutdown, and it has a backlog of about $5.75 billion in orders at the end of July, or nearly a year’s worth of annual sales.
Even with the reopening of most plants in May, it took until July for factories to reach full production since suppliers of materials, appliances and components needed to build RVs also were largely shut down because of the pandemic.
“We saw increasing retail demand over the course of the quarter, driving dealer inventories to historically low levels by year-end and our year-end backlog to a record high,” Bob Martin, president and CEO of the company, said in a release.
“This current demand for RVs, coupled with the need to replenish dealer inventories that are at all-time lows, positions us for continued success well into calendar 2021,” Martin added.
The surge in demand is being largely driven by new buyers – especially those in younger demographics – as well as the perception that camping and other outdoor activities are among the safest activities during a pandemic.
Over the summer, demand exceeded the supply of RVs and some dealers actually started advertising for used models that they could purchase for their lots. It didn’t get that bad at Total Value RV in Elkhart, but the inventory did get as low as it’s ever been, said Jeff Lemmon, marketing manager for the business.
“Units have been selling fast and to a lot of first-time buyers,” said Lemmon. “People still want to travel but there is so much they couldn’t do because of the pandemic.”
Though RV researchers believe there is a long-term trend favoring the camping lifestyle, the trend was fueled by the coronavirus, said Renee Jones, senior director of market for Thor.
“People have flocked to outdoor activities because of COVID,” she said.
At this point, Thor hasn’t announced any plans for additional expansion to help meet growing demand. Instead, officials have been looking for efficiency improvements that would allow incremental increases in production. Thor is the nation’s largest RV producer and employs more than 22,000 worldwide, including over 10,000 in northern Indiana.