The inaugural RV Industry Power Breakfast brought more than 400 people in the broad RV industry to the RV/MH Hall of Fame Thursday to get updates on industry growth, industry-wide marketing efforts, opportunities with the camping industry and local economic development opportunities.
ELKHART — Recreational vehicle manufacturers, RV suppliers, RV dealers, campground owners and area officials sat down together in the heart of the RV industry for an inaugural industry event, the RV Industry Power Breakfast put on by industry publication RV Business.
As more than 400 people filed into the RV/MH Hall of Fame’s Northern Indiana Events Center early Thursday, May 9, RV Business publisher Sherman Goldberg said, “it seems like it was a good idea.”
While it was sponsored by many RV businesses and the Recreation Vehicle Industry Association participated, it was the first time competitors sat down locally to take a broad, joint look at the industry and its impact on this area.
“Looking ahead it’s important that while we continue to compete with each other every day in the market, that we do not compete with each other in those areas that benefit all of this group of businesses,” said Gregg Fore, chairman of RV supplier Dicor Corp. and one of the event’s speakers.
Doug Gaeddert, general manager of Forest River and chairman of the RVIA, said, “I believe our industry is better coordinated than it ever has been. This breakfast is a great example.”
He also said, “take a minute to look around the room. Most of us compete with each other, sell to each other, buy from each other, finance each other, represent each other, write about each other and yeah, probably even cuss each other sometimes. But at the end of the day we’re all basically very good friends. It’s a very close-knit industry that we’re growing rapidly.”
THE INDUSTRY’S LOCAL IMPACT
Dorinda Heiden-Guss, president of the Economic Development Corp. of Elkhart County, detailed the efforts her group has gone through to help the industry grow back out of the recession. Last year alone the nonprofit group helped secure $15 million in tax benefits for RV industry expansion to bring another 1,912 jobs to the county, and this year they’re already at $4.7 million in tax perks to bring in another 825 jobs.
“If we haven’t said how special and how grateful we are to you, we want to state that today,” she told the leaders.
According to Heiden-Guss, the industry:
Provides $1 billion in payroll and benefits each year in Elkhart County.
Employs 25,000 to 30,000 people in Elkhart County.
Makes 75 to 80 percent of all its RVs in Elkhart County.
Has more than 100 suppliers in the county.
Tim Hyland, president of GE Capital’s RV group, pointed to Elkhart County’s manufacturing strength and said, “Northern Indiana has an economy that builds things.”
He also said, “things appear to be continuing in the right direction” for the economy. “Be proud of what you’re doing. The RV industry is very important to the growth of this all-important middle market,” which makes up only 3 percent of companies in the U.S. but employs 34 percent of U.S. workers.
Sen. Joe Donnelly spoke to the group via teleconference from Washington, D.C., and he thanked those gathered for all they do. “It is extraordinarily heartening to see all the jobs that are being created, to see all the opportunities that the RV industry is putting forward,” he told them.
“Your efforts, the entrepreneurial spirit, the spirit of America, that’s what makes our country grow, makes our country prosper, and my job is to stay out of the way as much as possible,” he said.
Jim Rogers, chairman of Kampgrounds of America, told the industry group, “you are an example that the rest of the country should follow and at the end of the day, what you have done is very meaningful to this society, to this culture and to America.”
The recession hit the RV industry especially hard, and it hit Elkhart County hard because of the key role the industry plays here. Since 2008, 53 companies have gone away, said Richard Coon, president of the Recreation Vehicle Industry Association, a joint effort by 410 companies in the industry.
In all, 35 percent of the suppliers and 36 percent of the manufacturers are gone since the recession, Coon said. Coon pointed out that the RVIA trade show in Louisville has only shrunk by about 16 percent since then.
While conventional travel trailers — which represent 63 percent of all RV production in this area — are up, other segments of the RV industry still remain below pre-recession levels.
“The heart of the industry, what you guys are producing, has never been better. Things are good. Trouble is, I’m sitting here thinking to myself, I was here in the banner years. This does not feel like a banner year.”
“If you’re working really hard today, I gotta tell you, pick it up. For the first four months motorhomes are up 50 percent. Motorhomes are coming back. The rest of the business will come back. We are not at a banner-year feel, yet.”
A PROMISING FUTURE
Coon said the manufacturers have done a great job of improving value, with prices today about what they were 15 years ago, but with better quality and more features in RVs. “That’s a real tribute to the people in this room about how hard they work, how smart they are, the kinds of things they’re doing. It’s paying off. The world is recognizing that. I had lots of comments about that from the rest of the world who haven’t been able to figure that out. You guys have figured that out. I salute you. Great job.”
Rogers said he’d like to see the campground industry and dealers and manufacturers all work more closely together. “We’d love to be a partner with you,” and urged manufacturers to “think more about the guest, the people, more than about the unit.”
KOA brought a couple of suggestions from campers: Always leave room for a cupholder in the bedroom, and make sure to include stove exhaust vents.
As three different facets of the RV industry, “we’ve got to do a better job of serving RVers together,” Rogers said. According to campground-industry numbers he provided, between 14 and 16 percent of Americans go camping each year, but only about 6 percent do so in an RV. That provides huge growth potential. “We think we should be your showroom,” Rogers told them.
RV owners have a strong repeat rate, with 70 percent of current RVers planning to buy a replacement, he said.
There’s room to expand into other markets in the U.S. American campers are disproportionately white, but “we’re seeing more first-time campers than ever.” Many Hispanic and Asian-American campers are starting to camp, he said. “We are not appealing to minorities ... once they get there, they love it.
RVs appeal to people seeking “soft rugged” vacations, where they can experience the outdoors during the day and sleep comfortably at night, he said. “America’s going there. You’re ready to take it,” he told the breakfast audience. Coon also said China has “huge potential” for the industry. “The Chinese government and people are just starting to get into RVing. If RVIA is not there working with the federal government of China and the provinces of China, you will end up with European standards for all of the products going into China, not U.S. standards. Hopefully enough said. If you guys want to take advantage of this huge market going forward like Detroit has done with the cars, RVIA needs to be in China today and needs to be working hard,” he said.
Canada is huge for the RV industry, with 20 percent of U.S. RV production going to Canada and 95 percent of RVs in Canada coming from the U.S.