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RV dealers hope to inspire sales
(News & Observer, The (Raleigh, NC) Via Acquire Media NewsEdge) Sep. 20--With gas once again hovering around $4 a gallon and credit tight, this might not seem like the best time for an RV show. But on Friday, a recreational vehicle show at the new Raleigh Convention Center drew both die-hards and the merely curious.
Turning those window-shoppers into buyers is critical for the dealers and manufacturers at the event which runs through Sunday.
It's a precarious time for their industry.
After five years of record growth, RV sales have slowed and are expected to drop 24 percent this year.
John Cathey, owner of Carolina Coach & Camper in Claremont, said his dealership is a $50 million operation. Last year, he sold 800 RVs. This year, he expects sales to be flat -- a first in his company's 15-year history.
"Every 11 or 12 years, you go through a mean year, and I think this is our mean year," Cathey said.
In the hope of boosting sales, dealers and manufacturers point out that new RVs are lighter, more aerodynamic and more efficient.
"A lot of people believe all coaches get three to four miles per gallon," Cathey said. "Some get 20-plus."
In one corner of the massive showroom, a salesman was touting a "toy hauler" -- an RV with storage space for items such as ATVs -- with a "V-nose" front to reduce air resistance by as much as 60 percent and increase efficiency.
"People don't realize how incredibly effective the engineering people have been," Cathey said. "They're safer now, they're lighter now, and they get better gas mileage."
That's a big deal when you have to fill a 100-gallon gas tank on a large RV. Even tanks on smaller RVs hold 40 or 50 gallons.
Still, it's the midlevel RVs -- with the smaller tanks -- that are seeing the biggest sales declines, dealers said.
People are buying pop-up campers and small trailers for family outings that cost $10,000 or less. And folks with money are buying the big luxury motor homes that can cost $400,000.
Those big models keep getting bigger -- many now reach 42 feet long -- and fancier, with flat-screen TVs, leather seats, keyless entry and convection ovens.
The buyers often are baby boomers who generally have a little more money to spend and are a little less sensitive to gas prices.
But boomers aren't enough to reverse the downward sales trend. Cathey said he is seeing fewer first-time buyers. In previous years, those buyers made up 30 percent to 35 percent of his customers; now they are 15 percent to 20 percent.
"I'm expecting it to continue this way till after the election or first of the year," he said.
Home on wheels
Still, RVing has plenty of loyalists. Karl and Madelyn Brenneman have been RVing for 25 years and are now "full-timers," meaning they don't own a house and live in their 36-foot RV.
"We started on the back of a motorcycle with a tent," Madelyn Brenneman said.
The couple calls Oregon home, but they are traversing the country. They've put 50,000 miles on their RV in the past three years. On Friday, they were in town visiting their granddaughter and decided to see what the latest RV developments were. Even with $4-a-gallon gas, the Brennemans said they have never considered driving less or parking the RV because of fuel prices.
"Instead of paying taxes or something like that, we buy fuel," Madelyn Brenneman said.
There are shoppers for whom gas prices are more of a consideration.
Malachi McCullough, for instance.
"My dream was always that I would retire and buy a motor home and go across the country and get back when I get back," said McCullough, who works for the U.S. Department of Agriculture in Raleigh. "Gas prices have just stolen that dream. Maybe someday I'll be able to do it."
But Kevin Broom, spokesman for the Recreation Vehicle Industry Association, argues that the current credit crunch is hurting sales more than gas prices.
Broom said most people finance the cost of an RV -- some over a 20-year period -- to make lower payments and because they can write off the interest payments on their taxes (the RV qualifies as a second home).
As banks have tightened credit, people are finding it harder to qualify for financing. Those who want to use the equity in their existing homes as a down payment or as collateral are finding that banks won't allow it.
"There's a lot of people going to RV dealers who would like to make a purchase but find they can't," Broom said. "There are some dealers and manufacturers who are doing just fine. It's a mixed bag."
See them all
The only way the current gas prices and credit crunch may be positive is that they help drive people to shows like the one in Raleigh this weekend.
Traffic at RV shows is increasing because buyers can view vehicles from dealers all over the state all at once, rather than driving to each one, said Jeff Zimmerman with Country Roads RV Center in Lexington.
The Raleigh show has products from 11 dealers and 45 manufacturers. It is expected to draw 5,000 people through Sunday.
Some people do buy at shows, Zimmerman said. But many who come to a show will turn up on his lot later, too.
"What matters to me is what I sell 30 days after the show," he said.
WHERE: Raleigh Convention Center, downtown Raleigh
WHEN: 9 a.m. to 8 p.m. today and 11 a.m. to 5 p.m. Sunday
TICKETS: Available at the door for $8 (print a $1 coupon at www.rvexpobydesign.com). Children 6 and under admitted free; ages 7 to 11, $1; ages 12 to 17, $5.
sue.stock@newsobserver.com or (919) 829-4649
To see more of The News & Observer, or to subscribe to the newspaper, go to http://www.newsobserver.com.
Copyright (c) 2008, The News & Observer, Raleigh, N.C.
Distributed by McClatchy-Tribune Information Services.
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